KPIX 5 reports from California. "In March the number of houses on the market in the Bay Area jumped by more than 12,000 percent to just over 24,000. Dr. Chuck Williams, the Dean of the University of Pacific School of Business believes 2007 will mark rock bottom for the housing market."

"'We don't see a bubble bursting,' William said. 'Prices have dropped 5 to 10 percent compared to two years ago. Interest rates are low; there's a tremendous amount of inventory from which to choose. And if you're a buyer those are the three conditions that you want.'"

"'The buyers are more excited now to go out there because they know they can work better terms with the sellers,' said real estate agent Adriana Barriga. 'Because the sellers are willing to be more down to earth and negotiate with the buyers.'"

"And in Tracy, observers say the 900 foreclosures in San Joaquin County won't slow the market for long."

The Sacramento Bee. "The spring home sales season is under way, and pros say this year you'll need every trick in the book to sell your house. With nearly 11,500 homes for sale in the capital region, and hundreds, perhaps thousands, of additional homeowners considering the same, 2007 is going to be more competitive than ever for sellers."

"'Price it right and present it right, and hope you get lucky,' says Yuba City broker associate Doug Bryan."

The LA Times. "Brad Cottrell was a paramedic when a friend introduced him to the high-rolling world of sub-prime mortgage lending. Within three years of landing a job with Ownit Mortgage Solutions Inc. in Agoura Hills, his salary had tripled. His wife quit working and they bought a 3,000-square-foot house in Camarillo."

"But late last year, defaults on risky loans began to rise. By December, Ownit was out of business, and the 35-year-old father of three was out of a job."

"'It was a nightmare,' he said. 'I felt like I got hit by a Mack truck.'"

"There's a lot of that going on. In California, mortgage industry job losses soared 367% in the first quarter. 'It's only going to get tougher,' said Cottrell, whose house is now for sale."

"In California, the 3,679 mortgage industry jobs lost in the quarter pales compared with the 70,000 construction jobs that economists figure could disappear over the next two years."

The Desert Local News. "The lender has repossessed developer Mayer-Luce’s ambitious Tuscan Hills development in Desert Hot Springs."

"'Yes, Mayer-Luce was the borrower and we have foreclosed on the property. We took back the property,' said Jeffery Lubin, President of Scripps Investments and Loans."

"The Tuscan Hills property is the second development Scripps has repossessed from Mayer-Luce. In Indio, Scripps took possession of the partially-built Vineyards project."

The Valley Voice. "Tulare has some 6000 'paper lots' available to build on joining Visalia with an abundant oversupply of subdivision lots. Tulare did about 550 new homes last year meaning the 6000 lots are more than a 10 year supply."

"The upshot, it will take time to absorb the inventory, a similar sentiment in Visalia."

The Fresno Bee. "City building permit fees will rise in June to make up a shortfall in the city fund that pays for building inspection and safety services."

"Visalia City Council members unanimously approved the increase Monday night after learning that the city's building-safety fund, which depends on income generated by issuing building permits to contractors for new construction, has a deficit of about $100,000."

"A slowdown in construction activity, led chiefly by a drop in home building from record levels in 2005, is being blamed for the deficit as fewer building permits are being issued. That continues a trend that began in mid-2006."

"In the first three months of the year, the number of permits issued for new single-family homes, and the construction value those homes represent, is off by more than 40% from the same period in 2006."

The Union Tribune. "The Australian development company that promised two years ago to build a 21-story luxury condominium project in National City is now considering asking city officials to lend the firm up to $2 million."

"Executives of Constellation Property Group won't discuss why they need a loan, but city officials said the company's financial partner, Phoenix Realty Group, wants to pull its money out of the project."

"City officials should view the Constellation loan as an investment, said Brad Raulston, the city's redevelopment director. 'They're not asking for a subsidy. This is a good risk or investment for us to take,' Raulston said."

"The company's Web site describes the Centro project as 'upbeat, urbane, unfettered, at the heart of a burgeoning community close to all amenities.'"

"In 2005, Constellation launched a marketing campaign to promote the National City project. The company opened a sales office on National City Boulevard and hosted a launch party for the project at downtown San Diego's Hotel Solamar that featured Australian food, live music and models of the project."

"The company placed ads in magazines and on billboards and began taking reservations through its Web site."

The Modesto Bee. "Kenneth Spencer hadn't planned on being a landlord. He and a partner thought they would make a tidy profit buying an older Modesto home, fixing it up, then quickly reselling. 'But we bought at the wrong time,' lamented Spencer, who lives in Martinez. 'We put a lot of money and a lot of time into that house.'"

"After spending $309,000 for the Elm Avenue home in 2005, plus $80,000 more remodeling it in 2006, they haven't been able to sell it for enough to break even. So they're trying to rent it for $1,650 a month. Even if they get that price, they'll still be short $1,000 a month on their mortgage payment."

"'It's all about trying to survive on the mortgage right now,' Spencer said. 'Real estate always goes up eventually, if you can hold on long enough.'"

"Many people are trying to hold onto houses they purchased as investments by becoming landlords. That has flooded the Northern San Joaquin Valley rental market with houses, pushing down rents and forcing landlords to compete for tenants."

"Many rental properties originally were bought by speculators who got caught in the real estate downturn, explained Paula Leffler Zagaris, whose company manages 1,500 rental houses."

"'They were gambling,' Zagaris said of investors who intended to quickly sell, or 'flip,' houses to cash in on rising property values. 'Anybody who did that before October 2005 was a genius and made a lot of money. But if they bought after that, they're stuck.'"

"Marie Nunez bought a home in 2005 on Bollinger Court in Modesto. She lived there one year, then moved to a larger home. 'We wanted to sell the (Bollinger) house, but it didn't sell,' Nunez sell. Now she's trying to rent the three-bedroom house for $1,275 a month, which is about $500 less than the mortgage costs. 'It's been hard to rent.'"

"A nearly new, 2,300-square-foot, four-bedroom, three-bath home with a three-car garage recently rented for $1,650 a month in Riverbank. Mortgages on such homes often cost $1,000 a month more than that, said Deborah Naylor, owner of Parkside Management, which manages 300 rental houses."

"'Owners are just so desperate because they can't stand to take that mortgage hit every month (without renting to cover part of their cost),' Naylor said."

"Often, owners ask her to seek higher rents, say $2,000 a month, but Naylor tells them, 'We're not miracle workers.'"

"Zagaris agreed an owner's costs have no bearing on what they can recoup in rent. 'We do a tremendous amount of counseling with owners about the rental market,' said Zagaris, who added 65 homes to her client list last month."