House Prices Won't Be Rising for Long

James Hamilton, at Econbrowser, notes that he's surprised by the 0.75% increase in average house prices (as measured by the S&P/Case-Shiller Index of twenty cities). He also says he's skeptical because of the backlog of unsold homes, likely increases in foreclosures, and high, rising unemployment, especially since Calculated Risk is, too. I agree that there's reason to be skeptical, especially since this rise in prices is likely to be a surge of people cashing in on the Obama stimulus package's $8,000 tax credit for first-time home buyers, which expires this fall. If prices continue to rise beyond that critical point, I'd say my skepticism (and CR's and Hamilton's) are wrong.