The Housing Bubble

The Voice of San Diego reports from California. “In the sharpest price drops recorded since two economists developed their popular method to track housing prices in the 1980s, local home prices declined a steep 16.8 percent from a year earlier and 21 percent from the peak in November 2005, according to the Standard & Poor’s/Case-Shiller home price index. The index for January, released Tuesday, marked the fourth straight month of yearly double-digit plunges for local prices.”

“The monthly plunges are beginning to strike a dramatic resemblance to the skyrocketing double-digit price ascent in the county during the boom.”

“Of the 1,954 homes sold in February, 37.6 percent were foreclosed upon at some point since January 2007. Such sales constituted just 4 percent of sales in December 2006.”

“‘And it’s not going to stop,’ said Ramsey Su, a local retired real estate broker and investor who sold bank-owned properties in the 1980s and 1990s. ‘There’s so much competition out there from sellers in the must-sell category.’”

“The price paid per square foot in February for resale condos and townhomes was $265, down 17.9 percent from February 2007 and down 24.3 percent from the peak, according to DataQuick.”

“‘The condo conversions … are disproportionately more affected than the rest of the market,’ said San Diego real estate agent Dan Cassidy. ‘For them, the [data] is, in my opinion, understated. The resale attached side vacillates between 25 and 45 percent, depending upon market area and whether or not it’s a conversion.’”

The North County Times. “Analysts say that though prices will continue to fall, San Diego’s desirable weather and location means homeowners have to redefine what is affordable.”

“‘San Diego has gone through what is called a Manhattanization because there’s only so much land,’ said Nathan Moeder, a principal a San Diego realty adviser firm. ‘You can say (a house payment) should be a third of your income, but that’s not the case for San Diego. It might be the case for the Inland Empire, but if you want to be here in the sun, close to the water, you’re going to have to spend for it.’”

“Christopher Thornberg, an economist with Beacon Economics said he is unconvinced by the theory.”

“‘That’s totally bogus,’ he said. ‘The kind of population density in San Diego is nowhere near what you’re dealing with in New York. That you could possibly even pretend that is the case is absurd.’”

The LA Daily News. “During January and February, there were 1,084 foreclosures and 1,335 sales of houses and condos in Valley communities from Glendale to Calabasas, according to the San Fernando Valley Economic Research Center at California State University, Northridge.”

“By comparison, during the first two months of 2007 - also in a slumping market - there were just 235 foreclosures and 2,481 sales.”

“‘It’s bad. It’s really bad,’ market analyst Nima Nattagh said of the foreclosure flood.”

“The rising foreclosures and falling sales keep beating down prices, too. ‘There isn’t any sign that the price (decline) is going to turn around,’ said Daniel Blake, a CSUN economics professor and the center’s director.”

“Many potential buyers are waiting to see how far prices will slide in response to the weak sales and rising number of foreclosures, he said. ‘You don’t want to try to catch a falling knife,’ he said.”

“Many homeowners helped create the problem they are now facing, said Nattagh, who has examined a number of foreclosure filings. ‘If you actually look at a lot of foreclosures, you see repeat refinancers - people who, on the basis that home values were going up, kept taking equity.’”

The Daily Bulletin. “San Bernardino and Riverside counties ranked No. 5 nationwide in home foreclosures in February, according to RealtyTrac. Fernando Castellanos, manager of the Rancho Cucamonga branch of Buy America Real Estate Services, is noticing some of the nation’s biggest price drops firsthand.”

“‘Some of these price reductions are unbelievable,’ Castellanos said.”

“He’s been keeping tabs on a Rancho Cucamonga home that sold for $960,000 three years ago. Today’s price: $585,000 - a 40 percent plunge. ‘In some cases they’re dropping more, some less,’ he said.”

The Bakersfield Californian. “Economist Christopher Thornberg spoke about real estate, falling median home prices and the local economy with The Californian on Tuesday.”

“‘In the short run, there’s no doubt, it’s going to be ugly… But in the long run, the nice thing is, with prices coming down to a reasonable level, there will be more room for expansion.”

“‘One of the big issues California was facing was, home prices that were so high that businesses couldn’t attract anyone. Families were leaving the state because they couldn’t afford anything.’”

“‘So now with prices coming back down again, you have the fortunate side effect of a market that will allow more growth. And that’s a positive thing in the long run.’”

“The San Francisco Chronicle. “The Standard & Poor’s/Case-Shiller report found the average cost of a Bay Area home fell 13.2 percent from January 2007, the sharpest decline since the report began in 2006, when it tracked 18 years worth of data.”

“More than half of the decrease in the region, defined as Alameda, Contra Costa, Marin, San Francisco and San Mateo counties, occurred since November.”

“‘The nationwide composite figures look so relatively large because no markets are boosting or holding it up,’ said Maureen Maitland, VP at Standard & Poor’s. ‘After 15 years of basic growth across the nation, every one is in pullback at this point.’”

“Esmael Adibi, director of the Anderson Center for Economic Research at Chapman University in Orange, said he expects the housing downturn to last at least through 2009, citing Case-Shiller data from the last housing market downturn. During the early 1990s, Bay Area home values fell just over 12 percent during a period of 69 months. The current slowdown is only in its 19th month, and prices have already fallen further, he said.”

“‘The bad news is I think we’ll see lower prices; 13.2 percent is not the end of it,’ Adibi said. ‘The positive is that maybe the cycle will be shorter, since the prices are going through this adjustment in such a rapid fashion.’”

The New York Times. “In 2005, Randolph Harrison and his wife, Pamela, decided to move into wooded Marin County to be closer to her new job. They found a six-bedroom house that seemed ideal except for the price, $1.875 million. The current owner, they knew, had bought the house a year earlier for $1.475 million.”

“So the couple, who both have finance jobs in the technology industry, told their real estate agent that they wanted to offer $1.575 million. He told them that the owner wouldn’t even listen to such a low bid. The owner’s attitude was ‘we’ll just stay here until we sell it for 1.875,’ the agent said, ‘even if it takes years.’”

“Three years ago, when the real estate bubble was still inflating, this sort of standoff was the exception. It’s the norm today. For both economic and psychological reasons, there is no asset more conducive to hopeful overvaluation.”

“Robert Glinert, a real estate agent in the Los Angeles area, said he has recently been saying no to almost half the sellers who have asked him to represent them. Their initial asking price is just too unrealistic.”

“‘People say, ‘I don’t care about the market — my home is still worth what I paid for it in 2006,’ Mr. Glinert told me. ‘And I say, ‘To you. Only to you.’”

“Doing what Mr. Glinert is asking sellers to do — dropping the asking price below their purchase price — is especially difficult. It’s tantamount to admitting defeat.”

“Often, this hurts no one so much as it hurts the would-be sellers. They stay in homes where they no longer want to live, rather than accepting their loss and moving on. Or they move but endure the hassle of renting out their old home, waiting, usually in vain, for the mythical buyer who understands its charms. All the while, their money is tied up in the house, and inflation is eating away at its real value.”

“Back in 2005, after Mr. Harrison and his wife couldn’t find a house they considered fairly valued, they opted to rent instead. They pay $3,250 a month for a four-bedroom home, which is a bargain relative to what their mortgage payments would have been.”

“And that six-bedroom house listed for $1.875 million? The last Mr. Harrison checked, it still hadn’t sold.”

The Orange County Register. “Orange County real estate agents collectively earned about 13 percent less in commissions from home sales last year than the year before. And their income was down about 42 percent from 2005, shrinking by $645 million in the past two years.”

“The reductions, spurred by two years of declining home sales, prompted more agents to either leave the business or find jobs elsewhere, while offices either closed or merged with other brokerages. Real estate brokers also reduced agent positions while cutting support staff and costs.”

“‘The industry as a whole is definitely taking a gigantic haircut in commissions,’ said Steven Thomas, president of RE/MAX Real Estate Services of Aliso Viejo.”

“Forty-five percent of all agents affiliated with an active Orange County real estate office had no income last year from commissions, said Patrick Veling, president of Real Data Strategies Inc. of Brea. Of the 55 percent of agents who had a sale last year, half did just one or two transactions apiece.”

“To put that in perspective, a sales agent’s typical commission split amounts to a fourth of the overall commission, or about $8,900 for the sale of one median-priced home in 2007. Fewer than 28 out of every 100 agents did more than two transactions last year, according to Veling.”

“‘We have too many agents in the business. This will filter them out,’ said Bill Plattos, broker for a regional chain based in Costa Mesa. ‘People thought it was easy. They muddled it up. Some of them were unprofessional.’”

“Virtually every agent knows someone who’s gotten out of the business, although most who have taken employment elsewhere say they’re keeping their licenses active and trying to keep a hand in the trade.”

“One agent, saying he earned just $12,000 last year, took a job at a fitness center to cover living expenses.”

“Edward Campbell of Midway City launched his real estate sales career in early 2007 but after six months realized that residential sales were not for him. He switched to commercial real estate.”

“Campbell recalled holding two open houses in early 2007 to which nobody came. Those days followed attempts to market the house, then time spent setting up signs and flags. Only to end up spending the day sitting in an empty house, hoping somebody would show up.”

“‘It was just boring,’ Campbell said. ‘It was just standing around doing nothing.’”

The Great Falls Tribune reports from Montana. “Condo developments can be found across Great Falls, ranging in both price and age. Calvin Scott, president of the Northwest Montana Association of Realtors in Kalispell and who serves on federal and state housing boards and committees, says Montana is in the process of catching up with the rest of the nation in terms of condo developments and ownership.”

“Bob Murray Construction built the Forrest Glen condos. Now he’s working on the South Park condos. The condos range in price from about $200,000 to $300,000. When Murray started building, he didn’t have time to set up an office at the site or get brochures.”

“‘We were just snowed with customers,’ he said.”

“Murray has noticed that the Forest Glen condos have appreciated quite a bit when they go on the market. ‘The appreciation is there…in almost all of the markets because of the huge demand,’ Scott, of Kalispell, said.”

The Oregonian. “The Portland area, once a star performer in an otherwise gloomy U.S. housing market, crossed into the same dismal territory in January when home values dropped for the first time since record-keeping began in 1987, according to the Standard & Poor’s Case-Shiller report.”

“In the Portland region, home values grew by double-digit percentages for 28 straight months. Oregon, along with the rest of the country, enjoyed a historic real estate boom from 2004 to 2006. Now, both are suffering through a historic collapse.”

“Portland was aided by Californians’ continued migration north in search of affordable housing. ‘Now, of course, that’s over,’ said Mark McMullen, an Oregon-based senior economist for Moody’s Economy.com.”

“Real estate brokers Paul Johnson and Sam Purtle have seen their business in distressed home sales jump in the slowdown. ‘What we’re seeing more of is people who bought houses in 2005 or 2006,’ Johnson said of the homes in short sales.”

“Their co-worker, broker Christina Smith, is listing a home on Southwest Hart Road in Washington County for $399,500. The current owner is trying avoid foreclosure after buying his home in August 2006 for $408,500.”

“Smith listed the home Feb. 1. So far, no broker has even visited the home.”

“McMullen forecasts that sputtering home sales will help drive the state into a short, mild recession this summer. That pain, he said, will continue to hit hardest among contractors, bankers and brokers who depend on housing for a paycheck. ‘There’s an unsustainable army of these folks out there,’ he said.”

The Register Guard from Oregon. “The national housing crisis has dragged Lane County’s housing-related industries down and pushed unemployment higher, according to statistics released Monday by the Oregon Employment Department.”

“‘It has to do with the housing crisis nationally — that is probably the biggest factor,’ said Brian Rooney, the Employment Department’s regional labor economist in Eugene-Springfield. ‘Anything close to housing is down.’”

“At Eugene’s Random Lengths, a newsletter that tracks forest product markets in North America, Editor Shawn Church said current lumber prices don’t indicate any immediate relief.”

“‘What we’re seeing right now is the industry responding to a very tough period — an unprecedented period, and one that rivals the early 1980s,’ Church said. ‘I think there’s hope that the housing mess will find a bottom sometime, maybe by late 2008 or early 2009. But I think everyone is braced (for) and resigned to a slow recovery, just given the extent of housing’s burst bubble.’”

The Bend Bulletin from Oregon. “There’s both good news and bad news for prospective homebuyers in Bend, according to local real estate and mortgage professionals.”

“Tom Greene, the president of the Central Oregon Association of Realtors, said pending sales for the month of March are up significantly, driven by low interest rates, lots of inventory and a realization that the current buyer’s market won’t last forever.”

“‘Buyers are jumping off the fence,’ Greene said.”

“A Wells Fargo document released late February said that in Deschutes County and other so-called ’soft’ markets across the country, borrowers may have to put at least 10 percent down to purchase a home, compared with 5 percent in a ‘normal’ market.”

“The PMI Group Inc., a mortgage insurer based, rated Deschutes County a ‘distressed market’ in its most recent quarterly survey released March 1, meaning the company will no longer write mortgage insurance policies for mortgages with less than 10 percent down, said PMI spokeswoman Stephanie Corns.”

“Mortgage insurance is typically required by lenders when the borrower is unable to pay 20 percent of the home’s purchase price as a down payment.”

“By requiring more money down, borrowers have more equity in their homes and, as a result, more options to refinance or renegotiate their loan terms if the value of their home drops, Corns said. Lenders don’t want homeowners to foreclose, Corns added.”

“‘Call it lessons learned,’ Corns said. ‘We have really learned through the economic downturn that equity matters. Options are limited when people have no equity … when you have some equity in your home, a cushion, you have some flexibility to work with the lender and servicer, so that’s the basis of our distressed market policy.’”

The Heraldnet from Washington. “Area real estate professionals and politicians want to clear something up. Now is a good time to buy and sell real estate in Snohomish County, no matter what people may be hearing about the national market.”

“Many of the speakers, including Ron Sparks, a VP at Coldwell Banker Bain, pointed the finger of blame firmly at the media, which he said are confusing the public. Sparks compared the real estate market to the weather: ‘What’s happening in San Diego isn’t helpful here.’”

“The industry and area leaders also need to address other ways to get people into homes, said Nathan Gorton, executive vice president of the Snoho­mish County-Camano Association of Realtors. In 2003 the median house price in the county hovered around $220,000. Today, it’s $368,000.”

“That’s great for homeowners, he said, but not so great for first-time buyers.”

“The subprime mortgage mess has made lenders return to ‘old school’ restrictions and requirements. Buyers may have to get help from family rather than use a riskier loan, Sparks said.”

The Seattle PI. “The Seattle-area housing market became more like the dreary national market in one more way in January, posting its first year-to-year price drop since 1991, according to the Standard & Poor’s S&P/Case-Shiller Home Price Indices.”

“The annual decline was the first since December 1991 and the largest since October 1991. The monthly drop is the largest in the history of the Seattle index, which goes back to the start of 1990.”

“Given that the Seattle area’s annual appreciation has been declining since February 2006, the fact that it finally is negative is no shock. ‘I’m surprised we hadn’t seen a decline actually a couple months ago,’ said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.”

“But Crellin also didn’t put much weight on a 1.3 percent annual decline. ‘It’s there, it’s real, but it’s not a big deal,’ he said.”

“The Seattle area has declined 5.6 percent from a peak in July, already exceeding an earlier forecast by Moody’s Economy.com that area prices would decline 5 percent from the peak to a trough at the end of this year or early in 2009.”

“‘I guess our forecast was maybe a little too optimistic,’ Andrew Gledhill, an associate economist at Economy.com, said on Tuesday.”

“Gledhill now expects a ‘close to double-digit’ decline in the Seattle area, hitting bottom the first half of 2009.”

“‘There’s still a ton of supply in King and Snohomish counties and it’s going to take a ton of time, with demand being so much slower, for that to be worked off,’ he said. ‘It’s going to be a tough year everywhere, and Seattle’s not going to escape it.’”

“Seattle’s prices continue to hold up better than places such as Miami or Las Vegas, which was just behind Miami with a 19.29 percent annual drop and the largest monthly decline, 5.1 percent.”

“‘Seattle’s never going to get to that point,’ Gledhill said.” “Crellin did not offer any numerical predictions, saying: ‘I think we’re going to continue to see some rough times for the next several months, but I’m hoping it’s not going to get much worse.’”

The Bellingham Herald from Washington. “Homebuilding activity is expected to slacken across Whatcom County this summer as builders wait to clear an inventory of unsold new homes. ‘I have pretty well stopped on the spec side,’ said homebuilder Gary Reid. ‘There’s enough inventory out there.’”

“Reid, a 33-year industry veteran, said experienced builders know that booms never last. Newcomers to the industry may face a harsher fate. ‘When times are good, everybody is a builder,’ Reid said. ‘This contraction takes them out of the market.’”

“Tightening standards for everybody else appear to be pushing more would-be buyers out of the market, causing home inventories to rise. ‘There’s just an oversupply of houses on the market,’ said mortgage broker Susan Templeton. ‘Three years ago there was an undersupply.’”

“David Latham, real estate loan officer at Banner Bank, said some homebuilders are in distress. ‘We’re seeing some very, very established builders having some real challenges out there,’ Latham said. ‘They just didn’t anticipate the dramatic and sudden slowdown in sales.’”

“In some cases, Latham said, investors with little knowledge of the home construction business went into partnership with builders, seeking profits. ‘They thought it was, for lack of a better term, a get-rich-quick thing,’ Latham said.”

“Whatcom County can’t escape collateral damage as money-lending tightens and the housing market cools off. Kristi Coy, senior sales associate at RE/MAX Whatcom County Inc., predicts that home foreclosures for 2008 likely will rise to about 600, a 50 percent increase from the 2007 total of about 400.”

“The problem, Coy said, is that many homeowners and buyers borrowed too much money during the mortgage market boom that ended with a bang in late 2007, and lenders let them.”

“Both borrowers and lenders assumed that home prices would keep rising. But when prices leveled off or sagged, banks and borrowers were stuck.”

“‘We don’t have a bad market,’ Coy said. ‘We have a normal market. What we saw in the last three or four years was an abnormal market and people got used to that. We got used to the high prices.’”

“‘All the people in foreclosure had life happen to them one or two years after buying,’ said Linda Zemler, a short sale and foreclosure specialist who works with Coy. ‘There’s no out.’”

“In many cases, the foreclosures stemmed from refinancing rather than home purchase. A scan of online foreclosure notices filed in recent months shows that the vast majority involve loans made in the past three years. In many cases, the homeowner had been in the home for much longer, but refinanced during the credit boom.”

“The Bellingham Herald compared October 2007’s batch of foreclosure notices to property sale records at the Whatcom County Assessor’s Office and found that 20 of the 41 foreclosure listings for the month appeared to involve refinancing.”

“In many cases, Coy and Zemler said, people tapped into home equity to pay medical bills after major illness. Others simply lost control of spending.”

“‘We’ve watched people lose their homes because they bought a new car,’ Zemler said.”

“Jude Williams, mortgage consultant at Wells Fargo subsidiary Bellwether Mortgage LLC, said some lenders never seemed to turn anyone away.”

“‘We never did a lot of that crazy subprime stuff,’ Williams said. ‘Some of the lenders out there really had much broader parameters. All you had to do was fog a glass. There was a lender for you somewhere. It was pretty bizarre for a while.’”

“Deborah Cook, broker and owner of Cityview Mortgage Professionals in Bellingham, said she often encounters prime borrowers who have been steered into subprime loans by other lenders. In some cases, that meant a ‘pay option ARM.’”

“‘You’re paying interest on interest on interest,’ Cook said. ‘They’ll call me. I’ll try to help them; there’s nothing I can do for them.’”

The Kitsap Sun from Washington. “In yet another indication Kitsap County is not immune from the current housing crisis, the number of properties that were scheduled for foreclosure auction during the first two months of this year is 140 percent higher over the same period last year.”

“About 110 properties were scheduled for auction in January and February combined, compared with 46 in 2007, according to the Bellevue-based ForeclosurePoint.com. Most were single-family homes.”

“Numbers from Kitsap County Assessor Jim Avery told the same tale. ‘Forced sales’ recorded by his office more than tripled between January and February 2007 and the first two months of 2008, from 33 to 101.”

“‘Forced sales’ also includes situations where homeowners and contractors who are behind on their mortgage payments simply walk away from the loans.”

“Walking away from an unaffordable loan is ‘a common occurrence’ today, Avery said. ‘It’s certainly the most serious we’ve had since I’ve been an assessor,’ Avery said of the loan crisis.”

“For all of 2007, Avery’s office counted 332 forced sales. A big spike occurred between November and December, when they rose from 29 to 55 forced sales.”

“About 259 properties are currently scheduled for future foreclosure auctions in Kitsap County, according to ForeclosurePoint.”

“Walt Bailey, co-owner of Olympic Northwest Mortgage, said the current climate is by far the worst of four down cycles he’s seen in his 20 years in local mortgage lending.”

“He offered some encouragement that this, too, will pass. ‘What I’m seeing here is cyclical,’ he said. Years of 20 percent appreciation finally caught up and now ‘we’re slowing up a bit,’ he said. ‘We’re just going back to where we were 10 years ago.’”

The Morning Sentinel reports from Maine. “Maine isn’t the kind of state where a drive through a large subdivision reveals home after home up for foreclosure sale. Instead, the foreclosure problem in Maine reflects the spread-out nature of the state, a house here, another there, a few more a couple of miles away. Nearly a quarter of Mainers with subprime mortgages are at least 60 days behind in their house payments. And nearly one in eight subprime borrowers is in foreclosure.”

“‘The idea that we would somehow avoid the problem or that it would not happen here has proven to be a fallacy,’ said William N. Lund, superintendent of the Maine Bureau of Consumer Credit Protection.”

“Caroline Wentworth’s rising mortgage bills pushed her to file for bankruptcy. ‘I’ve been through the worst nightmare in my life in the past year,’ said Wentworth, of Buxton, ‘and it’s not over yet.’”

“She said she and her husband refinanced their home four years ago. Their payments, initially $1,200 a month after refinancing, re-set to $1,500 after two years and are now jumping to $2,000 a month after another adjustment.”

“The couple’s income was pinched when her husband lost his job. Wentworth only recently made a partial payment on what she owes, the first payment she’s been able to make since October. Bills are piling up. Filing for bankruptcy has slowed things down, she said, and if the Wentworths hadn’t taken that step, ‘we would have lost it all,’ she said.”

“They explored a sale, but the home’s value has fallen from about $230,000 to $180,000, and the mortgage is for $200,000.”

“‘We tried to do everything possible to save this house and we’re still trying,’ Wentworth said. ‘I’m not walking away. I’m not giving up.’”

The Record Journal from Connecticut. “In Meriden, home sales have plummeted as lis pendens and foreclosures have skyrocketed. The ratio of sales to lis pendens was more than three to one in the city in 2006, according to the Warren Group. It dropped below two to one last year, and in January there were 56 home sales and 55 lis pendens.”

“The ratio in the state was only slightly better at one sale for every 1.4 lis pendens, and prices were off 5 percent to 14 percent for various sectors from one year earlier.”

“Samuel and Chayla Braun of Spring Valley, N.Y., spent more than $2.8 million to buy nearly 20 properties in 2004. They’ve since sold or lost most of them to foreclosure.”

“Another investor, who asked not to be named, said she and her husband bought properties on Springdale, Park and Crown streets in 2005 and 2006. The buildings needed work but there were tenants already in them paying rent, which would defray the cost of the mortgages.”

“But the arrangement quickly soured. Tenants trashed the units, she said, and moved out in the middle of the night, once even stealing a toilet that had just been installed in the bathroom.”

“‘That was the last straw,’ she said. ‘Thankfully, they turned the water off.’”

“City inspectors kept pressure on the owners to fix the units, and the costs became unbearable because of the lack of rental income. All three were foreclosed on last year.”

“Vacant houses are affecting his neighborhood, said Richard Pleines, VP of the West Side Neighborhood Association. ‘There’s already two over on South Second Street,’ said Pleines, a part-time real estate agent. ‘They’re becoming a hangout for the type of people you don’t want hanging out.’”

“Richard Pleines said it could be five or more years before the local housing market turns around. ‘We’re going to end up with a large volume of property that’s up for sale cheaply,’ he said.”

“An appraiser who works for Robert Claremont was sent to a house in Stratford and the real estate agent wouldn’t let her enter. ‘The agent told her she needed to call the lender,’ Claremont said. ‘I told her that is nonsense.’”

“The lender then called Claremont and said he had an appraiser who could put a $405,000 value on the house, and he found another one who could deliver $410,000. But if Claremont’s appraiser could bring it home at $415,000, the real estate agent would allow her into the house and she had the job.”

“Claremont was outraged. ‘This is really about your commission,’ Claremont told the lender. ‘You are conspiring.’”

“Since July, Claremont has tracked more than 100 requests asking him to violate his ethics. He plays a message still on his answering machine from a broker saying, ‘I’m looking for someone who knows how to maximize value without getting into trouble.’”

“Another lender in a home equity loan application wanted him to remove a notation stating that the home had been on the market within the last 12 months. ‘Had I caved under that pressure, I’ve committed fraud,’ Claremont said. ‘The bank could have come after me. This is out of control. The buyer has no idea this is going on.’”

The Boston Globe from Massachusetts. “The most widely respected index of home prices reported yesterday that Boston’s real estate downturn reached 28 months in January, as prices dropped about 3.5 percent compared to the same month last year.”

“Prices now have fallen 11 percent from the peak of the local market in September 2005, according to the S&P/Case-Shiller housing price index.”

“‘We have to look back to 1990 and 1991 to see sales trends that resemble what is happening now,’ Timothy Warren, CEO of Warren Group, said in a statement.”

“The last major downturn in Boston-area housing prices stretched 43 months from July 1988 to February 1992, according to the Case-Shiller index. Another five years passed before prices reached and then surpassed the high-water mark of July 1988.”

“In other words, a person who bought a home for $200,000 in the summer of 1988 would have had to wait nine years before being able to sell it for $200,000 again. From peak to bottom, prices fell almost 17 percent.”

“Part of the problem is the growing supply of foreclosed homes being resold at discounts. About 6 percent of the homes for sale in Massachusetts at the end of February were either foreclosures or short sales - attempts to sell the property without actually foreclosing on it - according to Movoto.”

The Sun Chronicle from Massachusetts. “The dream of home ownership has shattered for unknown numbers of (Attleboro) residents caught in the throes of the sub-prime mortgage crisis, and city officials often get left picking up the pieces.”

“Homeowners who can’t make their payments pack up, move out and slip away, leaving their once prized possession to the mercy of the elements and the mischief of vandals.”

“‘We had the boom,’ Building Inspector Doug Semple said. ‘And this is the bust. I expect the numbers to go up. There are a ton of houses out there that have been foreclosed.’”

The Berkshire Eagle from Massachusetts. “A car accident. A job loss. A health problem. A legal mess. A sluggish real estate market. Such are the roots of foreclosure troubles, which are creeping upward in the Berkshires. Foreclosures in the county hit a high of 101 last year.”

“‘People need to know this can happen to a good person,’ said Donna Maree, who is facing foreclosure on her Dalton house by a local bank. ‘It can happen to someone who isn’t a deadbeat, but you never think it can happen to you.’”

“She had planned that payments on her 15-year, fixed-rate mortgage would be finished by the time her retirement began. But when her son was charged in a rape case, Maree took on a second mortgage against her house to help pay his legal expenses.”

“Foreclosure seemed imminent, and last December, she found an apartment in Lenox. Maree has opted to file for bankruptcy to wipe her financial slate clean, even though her house was her only significant debt. Her son is waiting to be retried, and she said she’s confident in his innocence.”

“‘Now it’s water under the bridge,’ Maree said of her pending foreclosure. ‘I am blessed with a good job, my son will be OK, and I have many good things in my life. I am OK with it now.’”

The Plymouth Bulletin from Massachusetts. “The greater Plymouth area in particular appears to be an exceptional case, said Dr. Michael Goodman, the director of economic and public policy research at the University of Massachusetts Donahue Institute.”

“The housing market still has further to fall, he said, and will likely take several years to recover. In the meantime, the social attitude toward defaults on loans has changed.”

“‘They’re under water, and walking away from these homes,’ he said.”

“People who bought homes with the last two years aren’t doing very well, he said. He said the home prices might be lowest at the end of 2008. He said declining prices and rising incomes should improve housing affordability over the next few years.”

“‘People who are on the outside looking in at the housing market are going to be able to have access to more affordable properties than they would have otherwise,’ he said.”

The Times Union from New York. “If you’re thinking about buying an urban condominium, you have at least 514 options to consider. That’s how many units are up for sale, according to a new survey.”

“A prior Metzger Report found buyers bought just under 600 condos in the 15 years prior to 2007. That means the 161 bought or reserved last year represents a dramatic quickening of the pace.”

“Tracy Metzger, owner of T.L. Metzger, expects the trend to continue, even if the overall market slumps. The reason? ‘Pent-up demand,’ she said.”

“Still, developers kept proposing projects in 2007, the report shows. And the prices being charged were not low: In Saratoga Springs, for example, developers at the end of the year were asking an average price of $564,808. In Glens Falls, it was $386,809.”

“Officials in most area cities, save Troy and Schenectady, approved new condo projects during the year. Officials in Cohoes led the way, approving a staggering 384 new condo units, the report says.”

“By contrast, Albany approved 26 units, Saratoga Springs approved 58, and Glens Falls OK’d 15.”

“To be sure, many of those approved units are far from built. Even many of the 514 units the report says are available for purchase are condos in buildings that have not been constructed, like The Capital Grand project north of downtown Albany, a $30 million proposal.”

From MPN News in New York. “When it comes to the real estate market around here, the numbers are mixed: Single-family home sales in Ontario County dropped about 9 percent from 2005 to 2007, from 1,148 homes to 1,046, according to the New York State Association of Realtors.”

“The Locke family sold their stately 2,800-square-foot Victorian on Thrall Street in Naples recently — about two years after it first went on the market. After they had no takers in the first six months, they took down the for-sale sign and regrouped.”

“The Lockes lowered the asking price some and decided to give it another try about five months later. About nine months later, it sold, and the Lockes moved to a home about half the size in Penn Yan. They got a bit less than what they originally hoped.”

“The Lockes suspect that their longer-than-expected sale offering was because their former home is so unique, and because of tough economic times.”

“‘About five, maybe even 10 years ago, I would actually have people stop as I was mowing my lawn and say, ‘If you ever want to sell your house, we’d be interested in buying it,’ said John. ‘But when it came time to actually sell our house, we didn’t see that at all. The market had adjusted itself, but we didn’t necessarily know that.’”

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