Some economists argue that the housing market is as efficient as any. Nobel laureate Robert Shiller of Yale University isn't one of them.

"It is far less rational than even the often irrational stock market, for a couple of important reasons,"he writes in The New York Times. "First, most investors find it difficult to understand how housing supply responds to changes in demand."

And second, it's tough for investors who do have that understanding to "bet against bubble-level prices in real estate markets," he explains. "In housing, the smart money has relatively little voice."

In terms of housing supply, it tends to rise in response to growing demand, ultimately forcing prices down.

As for betting against the housing market, short-selling is required for an efficient market, Shiller says. "Short-selling helps prevent bubbles from forming, but such negative bets cannot easily occur in the housing market," he notes. "Markets without the possibility of making these negative bets will be inefficient."

To be sure, if you want to bet against the housing market, you can short the shares of homebuilders or of exchange-traded funds that include homebuilders.

Meanwhile, the S&P/Case-Shiller 20-city home price index increased 4.9 percent in April, and new homes sales rose in June to the highest level since 2008. So all's well in the housing market, right?

Not exactly. "Bidding wars, a hallmark of last decade’s housing boom, are making a comeback in a number of metro areas across the U.S.," writes Wall Street Journal reporter Kris Hudson. That includes thriving cities like San Francisco, Seattle and Denver.

"While the earlier wars reflected enthusiasm fueled by easy-money mortgages, the current froth stems from a market short of homes for sale," he says.

The inventory of homes for sale totaled 2.3 million as of May 31, which would last for 5.1 months at the current sales rate. In a healthy market, the figure would be six to seven months, according to the National Association of Realtors.

The problems include sluggish home-building and the reluctance of many homeowners to sell their abodes, Hudson explains. Their fear stems from worries that they won't qualify for a new mortgage, they can’t afford sales costs and that they'll lose out in the bidding war for their next home.

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