Hats off to my cubie Nate Parmelee for pointing me toward this housing bubble blog, which pointed me toward this interesting article from The Washington Post, a work that's simply too amazing for words. Irony? Poetic justice? It's got it all.

Here's the gist: Thomas M. Stevens, the president of the National Association of Realtors -- the "that'll be 6%, please" interest group that's spent much of the past couple of years denying the possibility of a housing bubble -- that Mr. Stevens has not been able to sell his house for a year.

We're talking about a $1.45 million house in Great Falls, Va. A nice place, it seems, four bedrooms, three and a half baths, but the kind of thing that would go for a fifth of that price just about anywhere else.

He blames the inability to sell it on his refusal to drop the price despite the advice of his real estate agents. In that respect, he's a fortunate man. Unlike many folks still hoping to ring the bell at the high end of the housing bubble, he's got another multimillion-dollar property to live in, and he's owned the slow mover long enough that it's not a problem.

Contrast that to the stories out there about waiters and tattoo-parlor owners leveraged up on multiple, no-doc, option ARMs, or the regular Janes and Joes finding out they simply can't afford the payments on the place they need for shelter.

Or take a look at some rare and belated straight talk from the NAR, and you might have an idea of the real risks facing the common folk out there -- the ones led down the primrose path to a housing "investment," driven there by the rose-tinted view of the NAR, along with easy credit from the likes of Accredited Home Lenders (NASDAQ:LEND), Countrywide Financial (NYSE:CFC), H&R Block (NYSE:HRB), and First Horizon (NYSE:FHN). Couple that with some disturbing inventory momentum from homebuilders like Lennar (NYSE:LEN), and I think prices have only begun to fall.

Mr. Stevenson's predicament may be ironic, and it may be regrettable, but it certainly wasn't unpredictable --Toll Brothers' (NYSE:TOL) declarations notwithstanding. Free money doesn't last forever, and it can't make housing affordable in a market where everyone believes the sky is the limit and pushes prices to the stratosphere.

Recent, minor upticks in interest rates are probably only the first cracks in the dike. I expect to see some real fireworks once all those ARMs start readjusting and overleveraged owners are forced to abandon their deflating dream homes. If the economy hits the skids in the meantime, what then? Somehow, I doubt pinched homeowners will take any comfort in knowing that the NAR's president finds himself unable to sell his superfluous home.

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At the time of publication, Seth Jayson had no positions in any company mentioned here. View his stock holdings and Fool profile here. See what he's Digging these days. Fool rules are here.

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