Housing recovery waiting on supply and demand to sync up

So much media hoopla was devoted to a recent story about U.S. home resales falling off a cliff in December. But the reality is you can't look at a single month when you're considering that kind of statistic. In fact, the trend over several prior months was that home sales were up as people sought to qualify for the $8,000 first-time homebuyer credit.

Meanwhile, The Orlando Sentinel reports that Orlando has more vacant housing than any other U.S. city. One out of every four houses is vacant in the metro area. As a result, the average price of a property has dropped 38 percent.

In another overbuilt area, The Atlanta Journal-Constitution reports apartment rents are back to the average rent of 10 years ago in metro Atlanta. Again, this is a symptom of being overbuilt.

Real recovery comes when supply equals demand. In order for the natural cycle of correction to take place, we need population growth and job recovery. However, one sector where jobs won't be coming back in is housing.

In the past, our jobs were tilted too heavily toward consumption activities, not creation activity. The consumer became 70 percent of economic activity, an unnaturally large number fueled by irrational levels of borrowed money.

Creativity will be one important component of the recovery. For example, alternative energies and various methods of conservation will both be growth areas. And that's the kind of green that has nothing to do with the environment!