The Sacramento Bee reports from California. "When home builders ruled the earth earlier this decade, a customer had to be humble. You waited in line, paid to get on eligibility lists and endured lotteries to buy houses that might jump another $5,000 if you didn't sign now and use the builder's lender. That was then, the old days: 2002 through 2005."

"In a bust that has lasted three years, they have gone through phases: denial, blaming the media for messing with the heads of buyers, predicting bottom soon and laying off staff. Now a chastened industry has reached a new stage, openly acknowledging its mistakes."

"The new humility was on display Thursday during a Sacramento-area builder seminar by San Diego-based Sullivan Group Real Estate Advisors."

"'We've effectively stolen from the future. The demand we should be having now we stole in 2005 and 2006,' president Tim Sullivan told the industry. 'We're paying for the sins of our past right now.'"

The Desert Sun. "Palm Springs' home sales during the first three months of 2008 were down 23 percent from first quarter last year. There were 9,214 homes on the market in April, according to the latest numbers from California Desert Association of Realtors."

"In many cases, the amount of inventory would take several years to sell off at the current sales pace, Real Data's figures show. In Palm Springs, it ranged from a low of 9.1 months worth of homes priced between $350,000 to $499,999 in 92262 to two years worth of $2 million-plus homes in the 92262 zip code."

"In Indio, it ranged from 12 months worth of homes in 92203 that are priced between $750,000 to $999,999 to more than five years' worth of homes priced between $1 million and $1.49 million."

"In Cathedral City, it ranged from a low of 10.6 months' worth of single-family homes priced between $350,000 to $499,999 to five years' worth of homes priced between $750,000 to $999,999."

"Local housing experts...said it is too soon to declare the housing slump is over. 'I don't think we can call it right now,' said Greg Berkemer, executive VP of California Desert Association of Realtors. 'This is a housing cycle that is different. It has different causes, it has different cures.'"

The Press Enterprise. "During last week's public meetins' about Fox Plaza, the Mixmaster Of Uses proposed for downtown Riverside, Kimberly Hodges, a Realtor specializing in downtown properties said m solé -- a new 10-unit 'live-work' development 'had officially been on the market for nearly 140 days and nothing has sold.'"

"Developer Alan Mruvka sees it differently. 'Technically, they might still be listed, but I haven't been trying to sell them. People want to see a finished product. I'm going to put them up for sale in about two to three weeks. That's when the ticking clock will start.'"

"Asking price for the 2,400-square-foot office-condos ranges from $620K-$720K."

"'If he can sell, I can sell,' says developer Mark Rubin, who's building Phase 1 (141 units) of 282 condos right across the street. Prices from about $280K. Rubin hopes the market rebounds, but says he'll rent if they don't sell right away.'"

"Fox Plaza developer Siavash Barmand will rent his initial 40 condos if they don't sell, too! Meanwhile, Barmand's watching Mruvka's live-work units to see how the market treats the first wave of new downtown housing since the Great Collapse."

"Rubin is bullish on downtown projects. Realtor Hodges ain't so. 'I don't believe we have the job infrastructure to support live-work (she lumps all proposed condos in this group). I don't believe they will sell,' citing a soft condo market and downtown's historic visage. 'Do you want to live in a historic district in something new or something old?'"

The Salinas Californian. "Last month saw 190 homes sold in the county - a 68 percent increase over March's numbers - and the highest figure since August 2006, when 202 were sold, according to statistics from the Monterey County Association of Realtors."

"But while the number of homes selling has rebounded lately, prices haven't, especially in Salinas. For example, in north Salinas last month, the median sale price for a single-family home was $336,250 - a little more than half the August 2006 median price of $610,000."

"Countywide, the average sale price fell from $946,937 to $689,950 during the same time. Sandy Haney, CEO of MCAR, said probably half of the 75 homes sold in Salinas last month were foreclosed properties. 'Market closing remains strong because the market price went down,' Haney said."

"A twist in the housing market right now is that a majority of people who lost their homes to foreclosure were first-time homebuyers, Haney said, while most of those purchasing the foreclosed properties are also buying for the first time."

From Reuters. "In some areas of California, so many foreclosed homes are available to buy on the cheap that real estate agents are discouraging prospective sellers from even putting their houses on the market."

"Perhaps the most extreme example of this is Stockton, about 85 miles east of San Francisco, where roughly three of every four homes for sale are in or on the path to foreclosure."

"The city's resale market is 'pretty much gone,' said Cameron Pannabecker, owner of Cal-Pro Mortgage Inc."

"'I don't know an agent today who would take your listing unless you're a hard-luck case. There is just too much competition,' Pannabecker said. Properties that at the peak of the market two years ago were selling at $500,000, or appraised at $500,000, are now selling for $200,000, he said."

"'Honestly, there isn't a huge amount of difference between a foreclosed home and a regular home than the prices,' said said John Knight, a professor of finance and real estate at Stockton's University of the Pacific Eberhardt School of Business."

"Distressed borrowers who manage to sell their houses are in many cases able to rent equivalent properties for about half the cost of their monthly mortgage payments. 'I don't know of anybody who has been foreclosed who is moving into an apartment,' said Paul Jacobson, an associate at W.T. Hull Co."

The New York Times. "Some of the biggest losers in the real estate slump are not purchasers of mansions they could not afford. They are buyers of second homes - or third ones, for that matter - who are sitting on a tax time bomb."

"Two years ago, Lilia Garcia and her husband, Jesus, bought their dream house in Linden, Calif., for $535,000 and financed it in part by taking out a bigger loan backed by their previous house in nearby Stockton. They decided to hang onto the Stockton house and rent it out, believing that it would more than pay for itself and could be sold years in the future to help pay for college for their two children."

"'We wanted to make it an investment,' Ms. Garcia said. 'I should've sold it.'"

"The Garcias, who earn about $65,000 a year, fell behind on their payments after their tenant moved out and the interest rate on their mortgage rose, bringing their monthly payments on the rental home to nearly $2,700 a month, from less than $1,000. They view foreclosure as inevitable; they have not paid the mortgages on either house for months and now rent a home in Linden."

"Then they discovered that they could expect a painful tax on the rental house. If the rental house sells for $160,000, which is about what they paid for it in 2003, they may still owe tax on $120,000 - the difference between the sale price and the $280,000 they borrowed against it over the years. That could mean a tax bill of more than $30,000."

"'I just thought we would file for bankruptcy and everything would be clear. We'd start all over again,' said Ms. Garcia. Now she and her husband are waiting to see what price the house brings before seeking bankruptcy. 'It's bad.'"

From CBS 5.com. "It was one of the Bay Area's most trusted banks. Now some consumer advocates question its lending practices in certain East Bay neighborhoods."

"The bank was World Savings, bought by Wachovia in mid-2006. They were a popular lender. But now some advocates want to know why so many of their loans were made in some of Oakland's low-income minority neighborhoods."

"Welcome to zip code 94621, where homes are going vacant and residents are uneasy. 'Our neighborhoods are becoming blight because of all the foreclosures,' said Diane Busby."

"'We have quite a few foreclosures on this block,' said Fannie Brown, who took us for a tour of her neighborhood. 'We had older people that lived in the homes and they were here like today and tomorrow they were gone.'"

"'When I have a caller who says I am in this negative loan. I never wanted this. When I ask them who their lender is I already almost know without fail, it's going to be World,' said Oakland housing advocate Maeve Elise Brown."

"Mae Washington lives in one of the hot spot zip codes. 'I received a letter in the mail from the lender stating that I had been pre-approved,' she told CBS5 Investigates."

"The loan was from World Savings, who held her mortgage at the time, but offered to refinance it with what sounded to her like a better deal: A pick a pay loan offering a lower monthly payment. 'I was thinking that you know, it was something that was going to be good for me.' But now? 'I think it's a terrible loan,' she said."

"Because like many others, Washington didn't know that paying that lower minimum payment each month meant her principal loan balance would increase over time by thousands of dollars. 'My principal went up by $20,000 to $25,000 that I owed, in a year.' Now she says she doesn't know if she'll be able to keep up with her rising payments."

"A report released Thursday by Chapman University in Orange showed consumer sentiment statewide has dropped for the third consecutive quarter."

"The index stands at 57.6 during the second quarter of this year. It's the lowest rating the university has reported in eight years and down from a reading of 94.4 during the third quarter of last year."

"Riverside resident Jeff Lasman echoed some of the survey's sentiment. He said he's cut back on dining out and even opted for cheaper fast food rather than more expensive restaurants."

"'I guess I'm worried about America's future,' he said. 'So many Americans have no idea how to tighten their belts.'"

The Fresno Bee. "Here's a question for restaurateurs: Are you following the example of the Hi-Life Prime Steakhouse in Kingsburg? Just a few years ago, when housing prices seemed they'd never stop rising, racks of lamb and filet mignons were mainstays on the Hi-Life's menu."

"A couple of weeks ago, the restaurant stopped serving racks of lamb. Likewise, filet mignon is a thing of the past. Instead, folks are coming in for $14-$28 meals."

"'No one seems to miss it,' says Hi-Life co-owner Tim Pa- shayan. 'They're not spending money on the $30-$40 entrées.'"

"The lower food costs -- and resulting lower entrée prices -- have brought in more diners, but they've also prompted the owners to open an extra night. They need more customers to make up for the lower prices, they say."

"Pashayan expects other restaurants to follow suit. 'If these restaurants here don't change,' he says, 'they're going to die.'"

The Ventura County Star. "Rather than deferring dreams, University Village in Thousand Oaks is deferring payments to help people move into the retirement community while they wait for their homes to sell. It's a creative approach tailored to a down real estate market."

"People can move in to a unit and enjoy all the amenities by paying the required monthly fee, but their one-time entrance fee is put on hold until their homes sell."

"For Allan and Shirley Walter, the program meant that they didn't have to let go of the one-bedroom residence they locked in at the pre-construction price even though it took longer than expected to sell their Spanish Hills home."

"Walter said he lowered the price on his Camarillo home, but it was worth it because he might have lost the locked-in price at University Village. Their Camarillo house sold in October."

"Warren Spieker III, VP of University Village Thousand Oaks, said many people who move into University Village have lived in their homes for decades and have more realistic assumptions about price. That often leads to faster sales."

"'These are folks not holding out for top dollar or last year's price,' he said."

"If sellers hold out for an unrealistic selling price, the community can give them notice that they need to pay within a certain amount of time or move back into their homes. It lets both sides know that they're not stuck, Spieker said."

"Doug Michie, an adjunct professor at California Lutheran University, said every house will sell if it's properly priced - even in the current market. The problem with a lot of sales on the market now is that a lot of people have more mortgage debt than their home's current value, he said."

"Many seniors are in a better position, having paid down or paid off their mortgages."

"'Coming out of the Depression, the children of that era are of the attitude of trying to pay their mortgage down by the time they retire,' he said. 'Perhaps we're now seeing the reason why the older generation put such an emphasis on paying down their mortgage.'"

"The Walters moved into University Village in November during Thanksgiving week. 'We're very happy here,' Walter said. 'Golly, it's so wonderful,' his wife added."