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— The supply/demand argument is an attempt to blame high real estate prices on environmentalists and slow-growthers. The real estate industry puts quantity of life above quality of life -- except their own quality of life.

The cheerleaders will pull out another figure that merits skepticism: the affordability ratio. It's calculated by the California Association of Realtors. It reflects the percentage of households capable of servicing a 30-year mortgage on a median-priced resale home. But it assumes a 20-percent down payment -- a rarity here. Also, it neglects the fact that "in California, a lot of buyers come in having real estate wealth already," says Starr.

This ratio is also designed to heap contumely on citizens wanting less road rage and more open space. And it's trotted out to scare potential buyers. Home sales have soared as San Diego's affordability ratio has dropped from 20 to 11.

The yahoos tell you that prices will go up forever because there will always be a shortage of homes. But they've said that before every crash. Remember, too, that in 1999, stock-market investors were told that shares would go up forever because there would be a shortage of stocks. It didn't happen. Home prices, too, won't rise forever. If the bubble bursts ingloriously, borrowers will feel the pain. But so will the lending institutions, which shoveled out money to people who really should never have bought homes.

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