Local realtors are seeing houses pop onto the market and have a double-digit number of offers in a matter of hours. In fact, looking at a macro level, the National Association of Realtors reported that the inventory of homes for sale has dropped to the lowest level since march 2005. Yet we’re not seeing house prices move north in an appreciable manner.

What gives?

The fact is, I don’t have a thrillingly good answer to that question. Could be the preponderance of distressed sales in the market as banks unload properties off their books. Could be the “shadow inven­tory” bleeding into the market and skewing statistics. Could be that all the demand is at the bottom of the price pool for homes. Could be that move-up buyers have been gridlocked into their current prop­erties because they are financially underwater. Could be that us Floridians were hit particularly hard by the downturn and our recent surge in demand indicates that we’re at the forefront of the bounce off of the market bottom. Lots of theories floating around.

I do have my own theory about it, though. I’m a believer in the pendulum effect. Things go too far to one side and on the return trip they essentially skip the middle-ground and end up entirely too far to the other side with a lot of momentum to artificially hold there for a while. Things were excessively good for a while, now the opposite is true.

Think about it. Go ask John Q. Public how housing is doing and he’ll probably give you some sort of story about how so-and-so lost everything in real estate and is suffering because of it. But John’s talk­ing about something that happened two years ago. Everyone is. But the markets aren’t concerned about two years ago. They’re concerned about the here and now.

And with all that negative sentiment floating around effectively keeping a lid on price appreciation and needlessly sidelining eligible buyers, foreign money and cash investors are snapping up properties at fire-sale prices. Doing it right in front of everyone and still going unnoticed. Because as bad as things are, owning a piece of America is still a smart long-term investment.