Moody's today reported that their August index of commercial property prices rose 2.5% from July. As the chart above shows, that means commercial property prices have been flat for the past two years.
Bloomberg's index of home builders' stocks shows that the fears coming out of Europe scared the bejeesus out of the real estate and construction market, driving prices down to the lowest levels since March 2009. Markets were braced for some really awful news on the U.S. economy which has failed to materialize. Instead of collapsing real estate prices, we see flat prices.
Once again, I emphasize that the recent increases in the prices of risky assets are not being driven by optimism, but rather by a decline in pessimism.
UPDATE: I've replaced the first chart with an updated version to include the latest Case Shiller home price data (through August). The net result is substantially the same: prices are flat.