There were 0 buyers between Nov 2008 and Feb 2009.  I went to see an agent and he said "I have never witnessed a time when there were 0 buyers".  A real correction would have occurred if banks and gov allowed it to happen.  It's now much worse. 

Sorry but incomes are reported as income from ALL sources.  Unless you deal with cash and are not reporting (this only applies to mobster/mafia/hell's angels crowd).

Supply and Demand is a great text book story but sadly doesn't work in the "real" world.  We know that most people are irrational, which is why you can sell a piece of crap for $1.3M to someone earning 150k.  Unemployment is low because you have hordes of people earning $15/hour... What house are they buying?