Ok, here's how I will explain how you could have researched the price two years ago and not been in the hole today..

You look at a city like Los Angeles. A decent starter home in a decent area was floating around, $1 Million dollars. So you do the math.

$6000/month mortgage. Not including taxes, that means $72,000/yr. Now add another 1.25% for taxes and your about $14000.
So cost to maintain home is $84,000 not including maintenance.

So then ask, how many people can afford $84,000 a year for a two bedroom starter home?

Well, that means, before taxes, I probably need to be pulling in no less than $250,000 in order to eat, pay electric bells, pay car bills, etc.

Then I ask, how many people do I know that are making north of 1/4 million. That includes all my doctor friends, lawyers, etc.

It becomes clear that the price of homes is way greater than what people can easily afford at this time. So, by doing this research, I understand that there is a housing market that can't be sustained by the income of successful professionals... I decide that a $1 Million dollar starter home is overpriced and will eventually come down.. I continue to rent and avoid disaster..

That is how I would have researched two years ago to avoid being in the hole today.

also, it's not the lenders and appraisers that create false prices. There is no such thing as a false price. Price is determined by supply and demand. Two years ago, there was very little supply and lots of demand because of low interest rates... But it's the buyers and sellers that created the pricing, not the lenders and appraisers. The lender and appraisers were on the same roller-coaster as everyone else. And at the time, they were appraising the houses for what those houses were worth, TWO YEARS AGO.

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"When two people agree on everything, one of them is not necessary" - Arliss