homeowner expectations and finds that homeowners typically overvalue their home by 5%. 

A week ago the general consensus was that interest rates were going to remain above 5% due to increased pressure on the mortgage market.  Not so fast because the rates fell again below 5% to close last week at 4.97% for a 30 year fixed rate residential mortgage.  The 15 year fixed rate is at 4.33%.  At this point, it is safe to assume that traditional rules do not apply to the markets; rather the markets are reacting to whatever is the strongest force du jour.  Hang onto your hats!  Low interest rates are great to encourage buyers to jump in the market. 

The Chinese real estate market is beginning to show signs of temperament following months of efforts by the Chinese government to calm the runaway markets.  The markets responded vigorously to government support of the industry which was injected a couple of years ago.  Unfortunately double digit annual price increases and risky lending has many concerned that the stimulus is causing an unintended real estate bubble.  Stricter lending requirements and more expensive loans are expected to slow the growth so that it will be about 10% less than last year.  Additional programs are being rolled out to ensure affordable housing is available.  Chinese investors have continued to find bargains in the United States' distressed sale market.  Runaway growth has fueled the investment in the U.S.  Long term retention of investors within China will help break the bursting bubble.