Housing Bubble?

Kevin notes a report that the “median [home] sale price [in Los Angeles is] up 29%, to a record $375,000, according to data released Monday” and says

I don’t care what anyone says, including the happy talk analysts quoted farther down in the story: this kind of panic buying is a sign of a late-stage bubble. It’s true that bubbles usually last longer than skeptics think they will, but this one has been firing on all cylinders for a while now. I doubt there’s more than a few months or a year left before it bursts.

Brad reads Kevin’s post and says

A 30% rise in local housing prices in a year in which short interest rates have not fallen and the yield curve not flattened is hard to explain as anything other than a bubble. But I still don’t see the housing bubble as covering enough of the nation to be a danger.

Meanwhile, young Matt Y. in DC, after reading this, made this announcement:

I decided to halt my inquiries into the possibility of youthful homeownership.

DC’s an odd case. I was there recently and everywhere I looked, I saw new condos being built and old boarded-up houses with “sold” signs and construction company signs on them. On the one hand, I’ve heard that Bush’s massive spending and the creation of the Dept. of Homeland Security have increased DC’s population by 20-something thousand (about 5%). So population is up, but I’m guessing that DC’s housing capacity is growing faster than its population (which should push prices down at some point.) In any case, housing prices in DC have more than doubled over the last four or five years, and the rate of increase has shown no sign of slowing yet.

Also, while DC was once a pretty run down city, many areas are revitalized or revitalizing — new shops, restaurants, night life, and so on. On the other hand, crime is still high and the public schools remain notoriously bad.

So, knowledgeable readers: is there a housing bubble in DC?