California Market Has Not Bottomed Out Yet
The Record.net reports from California. “After a year and a half of painful ‘adjustment’ in the housing market, slowing sales and sliding sales prices after four boom years, there’s still more to come, the chief economist of the state Realtors group told Central Valley agents and brokers Friday.”
“State sales of existing houses the first five months of this year are down 18.7 percent from the same period last year, said Leslie Appleton-Young, chief economist for the California Association of Realtors.”
“‘And it’s getting worse,’ she added. ‘So this market, unfortunately, has not bottomed out yet. We’re moving toward it, but it’s not there yet.’”
“This year’s attendance of about 100 Valley agents and brokers looked to be about half the usual attendance at the annual event.”
“Appleton-Young said the Central Valley market peaked in the boom years of 2002-05 in August 2005. Since that August 2005 peak in the Valley, she said, the median sales price has slid by 8.8 percent to $331,580. It’s down 6.7 percent just the first five months of this year, compared with a year ago, she said.”
“‘It’s not a falling off a cliff, but it’s certainly a squeeze down,’ she said.”
“Foreclosures from buyers who got in over their heads continue to affect the market, pushing up the number of homes for sale, she sad. That run of foreclosures still has a year and a half to two years to go, Appleton-Young said.”
“At the current sales pace, it would take nearly 11 months to sell all the Valley homes on the market right now, she said.”
“Turlock real-estate agent Richard Salinas, said he sees a housing market comeback perhaps by next spring, even with many would-be buyers sitting back and waiting to see whether prices drop more.”
“‘The fish definitely are not jumping into the boat any more,’ he said.”
The Orange County Register. “Orange County home prices are on track to tie the peak levels set last June, although sales continue to be down by almost 30%, new data that include the first three weeks of the month show.”
“It bears noting, however, that the median price is based the recorded sales price for closed escrows, but doesn’t reflect seller concessions that are now commonplace in home sales.”
“One thing that’s not known is whether the degree of seller concessions is greater today than it was a year ago, a time when concessions already had become commonplace amid slow sales and rising inventories.”
“James Joseph is a 26-year veteran in the business. We asked him recently to tell us how he sees the housing market and its future.”
“Us: Is the market flat, or down. And if it’s down, how far down is it? Jim: There really are two markets. First the price market and secondly the sales market.”
“The price market as reported is flat with the median property selling at about the same price as last year. If a buyer looks around however he/she will notice that there are a lot of homes listed at prices lower than what has sold. I would bet that a buyer today can get a better price on the same home today than he/she could have last year. Prices already are lower and more reasonable than last year.’”
The Gilroy Dispatch. “South County homeowners, many of them first-time buyers, are losing millions of dollars in equity. Mid-range markets in parts of the county, especially San Jose, continue to soften.”
“As a result, nearly 18,000 property owners, three times more than last year, are paying lower property taxes and getting a tax break because the value of their land decreased, dropping by a combined $4.9 billion.”
“This year, in Gilroy, 698 properties lost a combined $42.9 million in value, according to the assessor’s office. In Morgan Hill, 161 properties lost more than $9.1 million in value. Last year, 146 Gilroy properties lost $28.5 million in value and 38 Morgan Hill properties lost $3.6 million.”
“Lending practices that allowed thousands of Silicon Valley residents to buy homes with little or no money down drove prices up after the dot-com crash in 2001. Now the housing market is slumping and many of those buyers have no equity as their payments go up.”
The Press Democrat. “Santa Rosa officials Friday killed a widely touted deal with a private developer to build the city’s first downtown high-rise.”
“The project was to include a 545-space, city-owned parking garage, 183 condominiums, 208 parking spaces for the condo residents and 15,000 square feet of ground-floor retail space.”
“The high-rise was seen as a cornerstone of city efforts to turn around its struggling downtown by creating a residential market of consumers who could bolster the business of retailers and generate a night life after work hours.”
“Santa Rosa Mayor Bob Blanchard said Friday he was disappointed by the failure to move forward but said, ‘I do not see it as a blow.’”
“‘If we hadn’t gotten hit with a housing slowdown and the increases in steel and concrete prices, that project would be halfway up by now,’ he said.”
The Mercury News. “The house in Silver Creek that real estate agent Nancy Vanegas will soon put up for sale has five bedrooms, views of the foothills, and is part of a growing category in the housing market: homes that fail to sell at foreclosure auctions and are repossessed by lenders.”
“Known in the banking industry as REOs, for ‘real estate owned,’ once rare in Silicon Valley, may soon contribute to lower home prices in some neighborhoods.”
“In May, $2.8 billion worth of California real estate went up for sale in foreclosure auctions, according to a company that sells foreclosure information. Of that amount, about $2.6 billion worth failed to find buyers, and so became bank-owned. The figures represent the total value of the outstanding loans that went up for auction.”
“In January, $1.49 billion worth of property was auctioned statewide, and $1.32 billion went back to banks. January is typically a busy month because trustees usually refrain from foreclosing during the December holidays.”
“Vanegas, who specializes in REO transactions, had three such listings last year. Currently she has 27, ranging from condos to the Silver Creek home, where a neighboring home sold for $1.3 million last fall.”
“An estimated 8 percent of homes for sale, or about 450 houses and condos, in Santa Clara County as of June 30 were ‘distressed’ in some way’ either being sold in a ’short sale,’ or in foreclosure or as REOs, according to a new report from Movoto, a brokerage based in Redwood City. Movoto gathered the data by scouring the agent remarks that accompany homes on the MLS.”
“There probably are not enough bank-owned homes on the market in Santa Clara County now to drive down prices single-handedly, especially as the trustees that own them are not deeply discounting. But that could change as the market does, said Laura Pephens, a director of the California Mortgage Bankers Association.”
“‘All mortgage servicers are buried in this issue right now,’ she said. Trustees, the entities that have assumed ownership of the properties, be they the original lender or a mortgage servicing company, are still trying to get a handle on the increased number of REO properties they are managing, and on how much leeway they have to discount home prices without encountering resistance from investors in the mortgage-backed securities.”
“‘In this market right now, I hope trustees are being more flexible in terms of the purchase price offers,’ she said.”
Here’s an MLS search for Sacramento County. What I do is set the low end at 100,000 and sort as “Price Ascending,” then look at how many of the properties on the first few pages have “Bank Owned,” “As-Is,” or “Short Sale.”
Fun entertainment.
(This site is also nice in that it actually gives lots of info about the place, including HOA dues and where the water comes from.)
“Turlock real-estate agent Richard Salinas, said he sees a housing market comeback perhaps by next spring”
Perhaps next spring…just like last year, when people were saying that sales had slowed down significantly, but wait ’til next year’s Spring Selling Season (now), when things will bounce back. Didn’t exactly happen.
Oh well, maybe next year. Or the next. Or the next.
I loved this. They are already starting the spring of 2008 comeback drumbeat.
The good news is that they appear to have abandoned the 2007 comeback drumbeat.
Can’t wait till July of 2008…hope to be reading many stories about realtors making a living as strippers getting their 6 the hard way.
Sniggle, keep laughing. I actually know one gal who is both a realtor and stripper.
How does she look?
blond, early 30s, tall, nice face and body, and Ben will kick me off if I go into further detail.
Shoulda said early 20’s. More people would be buying houses then.
That’s strange. Most realtors are retired strippers. j/k
The same people that can’t afford to buy this last spring will not be able to buy next spring either. Maybe if prices are halved.
“‘The fish definitely are not jumping into the boat any more,’ he said.”
I know this clown was just using a figure of speech, but this quote sounds pretty condescending in this case. It makes him sound like the REIC is the casino and we “fence-sitters” are the marks, just waiting to be reeled in.
Also, the Calif. spinners keep making it sound as if would-be buyers are merely waiting for further price drops and hoping to “time the bottom.” That may be partly true, but I don’t give most people that much credit for being smart.
If the 105% LTVs were still being given out to minimum-wage earners, the party would still be on. I think a lot of knife-catchers would love to buy “on the dip” right now, but they can no longer get financing with no down payment.
– Judge Smales
“You’ll get nothing and like it!”
I agree with the Judge,
A *lot* of people who would like to buy this dip… cannot.
Tightening credit has locked out the greatest fools. (They won’t even realize how lucky they got…)
I posted on another thread that either salaries at my company need to go up 70% or prices in real terms need to drop ~40% before retention ceases to be an issue for us.
This will self correct… just on what time scale?
Got popcorn?
Neil
“I posted on another thread that either salaries at my company need to go up 70% or prices in real terms need to drop ~40% before retention ceases to be an issue for us.”
No one who asks how come I am not buying a place right now has given an answer to my question of who and what jobs makes that much money to afford close to $1mil house? I then say the 10-20% down payment and ask how many people actually have that much in a savings account ready to go? Until I hear otherwise very few people can afford this mess, though not even a 70% increase at my work would do too much for the Los Angeles area.
HELOC - Dont call it a loan
can no longer get financing with no down payment ??
WAMU & Country are still doing 100%…Just need high credit scores…
Most people with good credit arent dumb, its the low credit who spend, spend, spend and is why their credit is low, they take on debt.
May happen for a while in spring ‘08. It is called a ‘Bull Trap’.Then down, down, down to ‘011.
“Appleton-Young said the Central Valley market peaked in the boom years of 2002-05 in August 2005. Since that August 2005 peak in the Valley, she said, the median sales price has slid by 8.8 percent to $331,580. It’s down 6.7 percent just the first five months of this year, compared with a year ago, she said.”
Oh yeah, its “in the bag” baby!
“An estimated 8 percent of homes for sale, or about 450 houses and condos, in Santa Clara County as of June 30 were ‘distressed’ in some way.”
Hmm…that’s odd. Only 450? According to http://www.foreclosure.com, in Santa Clara County over a 4-wk period the total foreclosures, pre-foreclosures, and BKs were as follows. How reliable is http://www.foreclosure.com?
June 15 - 2972 Foreclosures, pre-forclosures, and bankruptcies
June 22 - 2992
June 29 - 3079
July 06 - 3161
The San Jose Mercury News’ Saturday real estate section is now tracking the number of foreclosures and REOs on page 2 with comparisons made to last year’s numbers. Foreclosures and REOs jumped over 400% from May 2006 in Santa Clara County!
This is quite a change when even the normally rah-rah MSM starts publishing and tracking foreclosures!! And in the “it is different here” South Bay areas too! Wow!
How is that split?
In other words, is that tracking homes that were actually foreclosed upon or homes that entered the foreclosure process? Big difference, IMO, but at least the latter does indicate a change in trend.
June 15 - 466 FCs, 1596 PFs, 910 BKs
June 22 - 475 FCs, 1650 PFs, 867 BKs
June 29 - 506 FCs, 1711 PFs, 862 BKs
July 06 - 524 FCs, 1786 PFs, 851 BKs
Wonder if these splits are mutually exclusive….
Thanks!
I guess I’m still misunderstanding something though. Are the June numbers 2006? That means there are over 2000 FCs in SC County in June 2007?
“Santa Rosa Mayor Bob Blanchard said Friday he was disappointed by the failure to move forward but said, ‘I do not see it as a blow.’”
“‘If we hadn’t gotten hit with a housing slowdown and the increases in steel and concrete prices, that project would be halfway up by now,’ he said.”
- I know how Bob feels…. “IF” I would of correctly picked 5 different numbers in last nights lotto - I would be a millionaire.
Strange, I thought building materials had substantial price reductions this year.
Some yes….Others no….
“Santa Rosa officials Friday killed a widely touted deal with a private developer to build the city’s first downtown high-rise.”
Santa Rosa has a downtown?
Seriously, it is getting out of hand. (ok, it got out of hand). How many people want/need to live in “downtown” Santa Rosa? You’d think it’s the next Manhattan or something. Let me guess, they’re running out of land in Northern California and need to build more dense housing…
All of these teeny tiny cities trying to go condo… seriously.
hah!
little do you know of their secret envy.. of how Santa Rosans long for the hustle and bustle of big city life..
Santa Rosa sprawled all over and started to fill in to such a degree that traffic snarls and incidents have shot far up above any historical levels. There are always a small percentage of folks who like dense living and it is really important to give them what they want where there are towns because it keeps them off the roads and in aggregate saves a huge amount of money. The overall chunk of the population living in relatively dense urban conditions tends to be about a sixth, and Santa Rosa does have a small functional downtown for about that money.
Of course this tower plan was a bit ahead of its time. Some of the other condo projects that did get built were also ahead of their time. The area is going to have a haircut like everyone else, and because neither software nor any other industry surged back after the dot com implosion there will be a substantial overhang.
I don’t get the $400K condos near Rohnert Park. (My employer has a division there)
Just 6-8 years ago, I seem to remember SFHs in the mid to high $100s in Santa Rosa. Am I mistaken?
I’m not sure you can even call what Santa Rosa has a “downtown.” Basically one main street with restaurants and bars, a Barnes and Noble, and the rest are side streets (alleys) that look a bit beat up.
Sonoma wine country really accessible from there though.
it is all a question of perspective, I recently moved to Santa Rosa from a much smaller town, now work downtown and live within walking distance of it…there are several good bars and restaurants, an excellent independent book store, two brew pubs, lotsa coffee places, and a really good newsstand….pretty exciting after 10 years in a small town….but I can’t see how the condo project would have made it either.
No your not mistaken at all…. SR had condos around 100K few years ago. The same was true with Santa Clara County at around 150k… now up 400%. Considering inflation is low and the excess of dot.com are all gone.. one can expect a correction of 50% or more.
…As well as larger “has been” cities, like Oakland, trying to go condo….
“Foreclosures from buyers who got in over their heads continue to affect the market, pushing up the number of homes for sale, she sad. That run of foreclosures still has a year and a half to two years to go, Appleton-Young said.”
This Appleton -Young is a real bimbo! If RE agents and mortgage brokers along with cluless appraisers had not pushed prices beyond their ability to pay we would not be in this mess in the first place.
2 more years is when the ALT-A crisis hits. Think subprime on steroids!
I was thinking about the alt-a thing–is it possible that we’re already seeing a lot of the alt-a in foreclosure? I know the reset is still in future, but if flippers were using it they may be in trouble already. Without the stated income they could have hoped for (and had cash only) for a quick flip in a few months.
Most flippers opted for the 2/28 pay option to avoid the capital gains tax. The specuvestment would be claimed as their primary residence for those two years. Then they would sell for a huge profit after two years was up and avoid capital gains taxes. I think the people who chose the 3-5 ARMs actually planned to stay in their homes.
“‘It’s not a falling off a cliff, but it’s certainly a squeeze down,’ she said.”
Yes many folks are feeling the squeeze. The cliff is up ahead a year or two, but we are moving towards a critical point, where buyers unable to borrow more than they can afford to repay are simply not able to overpay. Sellers will either recognize the new truth, or will not sell for a very long time.
Most won’t be able to hold on. The rising cost of everything will make it very hard for many people to keep paying their mortgage.
I prefer to think of the current RE market as the early rapids and rocks in a fast moving stream about to plunge over a waterfall. Right about now, the guide (NAR) is reassuring the crew that it is a bit bumpy but should flatten out soon.
I like to think of it as an iceberg. It’s a living and ever changing thing, in a constant state of flux. It’s melting is a combination of the warmer air and warmer water (subprime & Alt-A). Which is causing the most shrinkage? Who knows….hard to tell only looking at the portion above the surface of the water.
But in the end, the poor little bergie will have flip-flopped into non-existence. Between now and then, just keep your boat from running into one.
“Orange County home prices are on track to tie the peak levels set last June”
What’s the deal with no price declines in the OC
“What’s the deal with no price declines in the OC”
It must be due to that Great Wall of Orange County.. keeps OC isolated and protected and independent .. making it a truely unique place unlikely to be affected by the Mongol financial collapse surrounding it.
I actually hear this all the time, with articles like that, the bears are more emboldened and will very likely continue to scoff at the idea of any real price decline.
Very frustrating indeed, even depressing! Sometimes I wonder if I should just buy instead of taking what I thought was the prudent route. It is tiring to see the profligate and supposedly ill-informed continue to prosper and profit from this upside-down world.
Well even in a “flat appreciation” scenario (which is actually 3-4% depreciation due to inflation) there’s no reason to buy if you can rent for half the price. In order for buying to make sense, the annual appreciation has to outweigh the rent discount.
sydsydsyd
While the median is rising, prices are falling. The median only indicates the range of houses selling, not the true value. Price per square foot is falling. People are getting much more house for the money. You know this.
Price per square foot tell the real story.
It’s the median…come on, you have been posting here long enough to know that already.
“you have been posting here long enough to know that already……”
Now, what was that Upton Sinclair quote again?
“…Durham’s Meat Packing, we sell everything except the squeal!…”
No!!!
“It is difficult to get an investorgirl to understand something when her salary depends upon his not understanding it…..”
his = her …..
(No humor in a poor delivery…. )
What salary I’m not a RE agent you moron
From 6/26/2007 to 7/3/2007, there were 4 homes sold in ZIP code 90274 for an average price of $1,566,750.
1) $1,000,000 on Lucera Cir
2) $1,652,000 on Middleridge N Ln
3) $1,415,000 on Ranchview Rd
4) $2,200,000 on Via Leon
what’s the deal with no big price declines in PVP - Palos Verdes Peninsula?
I called the RE agent on a dumpy little 2 bedroom, 1200 SF, 4000 or so SF lot, 60 year old house in the Venice area. The price? 1.2M.
You don’t know the real price until it sells. Wishing prices mean zero.
I do a lot of cabinet design work in the Palos Verdes, Rolling Hills and Rancho Palos Verdes area. Our sales continue to hold steady with the last 7-8 years in that area. Our sales in the Malibu - Pacific Palisades area are up for sure. Still a lot of strong money at the higher income areas. One of our main area’s is Manhattan Beach and there is absolutely no drop from the last 7-8 years.
Interesting. Seems like a lot of people struck it rich in the double bubble, and they may still be duking it out in the elite markets. Just interesting to ponder how many can and would really pay $1.2 M for a 2br 1200sf in a dive like Venice. Time will tell….
California is slowly morphing into a 3rd world style economy. Basically that means 10% of the people will be pretty darn rich, 20% or so, mostly professionals like doctors and professors will comprise the middle class and the other 70% will drift into near poverty.
But we are currently early in this process of economic change and about half of the bottom 70% still think they are in the middle class even though jobs are disappearing, expenses are rising and bankruptcy looms. Most are using debt to cling to the lifestyle they are used to.
The 10% who are rich don’t care much about price. A 2 million dollar house in Marin or Pacific Palisades will probably still cost 2 million in ten years.
But the bottom 70% of us who are relentlessly getting squeezed out of the old middle class and into the new lower class care very much about price. And the price we can pay will just keep sliding down for the next decade at least.
A tract house in Stockton or Riverside that cost %500,000 two years ago might list for $400,000 now, $300,000 in two more years, $200,000 in five years and $100,000 a decade from now.
Meanwhile that 2 million dollar house in Pacific Palisades will still sell for 2 million.
the sad thing about this is that I have started mentioning to friends look how there are so many poor people during the boom time. I am sure in imaginary world that 20″ rims on the gas guzzler SUV and large TV’s make people rich, but its truly sad how many people have no savings or retirement tucked away and really are living paycheck to paycheck yet have all of the stupid toys. Its one thing to have an expensive hobby, but spending large amounts of money to show off to other people? Truly disgusting and is starting to make me sick to my stomach when looking around the Los Angeles area.
What happens now with the economy starting on its way down. I think that starts to put people into perspective about what is going on.
HELOC - Don’t call it a loan
Meanwhile that 2 million dollar house in Pacific Palisades will still sell for 2 million.
This might be true to an extent, but at some point lower priced homes will trickle up. If this was not true, then there would be a massive jump at some point between a nice home and one just a blade of grass nicer, so while rich folks and I DO mean rich are apparently swimming money, and might not care, the rich people I know still know a bargain when the see it, and are not stupid with their money.
The concentration of wealth that we’re seeing in the U.S. truly favors only the extremely wealthy, and here I’m referring to the Forbes 500 families.
Ask a physician in a few years whether he/she will be able to afford that million-dollar home, especially with HMO’s beating down on them.
Good stuff, Binko.
“California is slowly morphing into a 3rd world style economy.”
Agreed, but not just California. Much of the country is headed in exactly the same direction. Mortgage serfs, who whether they can keep the house or not, will be in debt for the rest of their lives, with minimal savings or retirement cash are the new working poor. As jobs in the service sector rachet down, with lower wages and minimal or no benefits, the mirage of a “healthy economy” or strong middle class will be revealed.
Still watching the pols on both sides running for prez who are pretending that this election will be held before the economic abyss makes itself clear to the electorate. America’s future looks like Argentina.
Spike is right - we’re well on the way to becoming a banana republic. And in 2008 those pols will be courting figments of Norman Rockwell’s and Frank Capra’s imaginations.
I agree, post NAFTA, Latin Am. social conditions have arrived. The wealthy and their hangers on will pay the premium to live in certain neighborhoods whether they have cash or need to assume debt which they should be able to service. But these areas will not be completely immune from a downturn, just less so.
They just prepare to sell …
I can’t stand how these jerkovs constantly refer to the “4-year boom” or the “5-year boom.” This bubble’s been blowing at least since 1998 in SoCal. Property values were up 50% in 2000 from the lows of the 90s. Let me see if I can find a chart…
http://graphics10.nytimes.com/images/2006/08/26/weekinreview/27leon_graph2.large.gif
When will we reach the bottom?
http://www.smugmug.com/photos/136440158-O.png
“As a result, nearly 18,000 property owners, three times more than last year, are paying lower property taxes and getting a tax break because the value of their land decreased, dropping by a combined $4.9 billion.”
“This year, in Gilroy, 698 properties lost a combined $42.9 million in value, according to the assessor’s office. In Morgan Hill, 161 properties lost more than $9.1 million in value. Last year, 146 Gilroy properties lost $28.5 million in value and 38 Morgan Hill properties lost $3.6 million.”
Goes to show, WHAT GOES UP - CAN AND WILL COME DOWN. Notice that I have no sarcasm at all after watching all of the BS for the last 5 yrs I was in the Bay area. Happy watching this one crash
Happy watching this one crash
Yup, sorry if these folks retirement plans (forget work, just sell your house at an outrageous price to the next shmuk) did not quite work out. Perhaps there is still time for honest hard work and savings?
““This year, in Gilroy, 698 properties lost a combined $42.9 million in value, according to the assessor’s office.”
That’s over $61,000 per property. And this according to government officials who income depends on keeping the “value” high.
Nope. Move along folks. Nothing to see here.
whose income. it’s a monday - what can i say?
are still trying to get a handle on the increased number of REO properties they are managing, and on how much leeway they have to discount home prices without encountering resistance from investors in the mortgage-backed securities.”
To hell with the investors and MBOs. Price the houses low enough to sell em. Ladies and gentlemen. We now have new comps.
Or lets have a mega open house. I would love to come and eat their food, pop the balloons, scare the squirrels in the BBQ pit, and insult the realtors all in one visit. LOL
Any listing marked with V* next to the price means the seller is willing to entertain offers within the Listing Price range. For example, a Price of $140,000-170,000 indicates the seller will entertain offers from $140,000 to $170,000.
WTF? if the price is $140K then that is the price. If it is $170K, then that is the price. Now if some idiot willingly pays $170 when they could get it for $140, then no words I know of can describe this stupidity. This range ‘entertain’ bit has always got me hot under the collar. Maybe it might work for the seller in a fool’s market, but not in a dropping faster than Paris Hilton’s panties on a Sat evening market.
Yeah, its kinda like the “no haggle” car pricing from a number of years back.
They’re basically saying that $140K is the price, but making you think that $170K is what it’s worth and what a deal you’re getting at $140K. Seeing as how every California trend makes it here, I assume that will be the new marketing ploy here soon.
If I saw that on a house I’d undercut the low by 20% just to prove a point. You can’t set a rigid range and suggest that’s the only price. It’s worth what I decide to pay for it.
makes you want to offer $130K doesn’t it ?
makes me want to ignore the seller.. i don’t do business with idiots because it’s dangerous.
This was one reason I wanted to get my RE license. I would go door to door on a Sunday and start making offers of 60-70% off on every single house in the city. And then get some people together and start doing this with multiple offers. I would love to waste everyone’s time doing this. Imagine if everyone looking for a house/condo right now just started lowballing like that?
HELOC - Don’t call it a loan
I wonder if that would then set the “value” of houses? I don’t really like the term lowballing anyway, since in todays market, it is not really lowballing, but rather countering with an offer reflective of the current market. Just because some seller thought based on an anomolous year in 2005 that his house was now worth what he is asking does not mean it is. That was then this is now, and next year will be next year. Todays “lowball” offers will seem generous indeed!
I asked a realtor I just meet if she was willing to put in lowball offers. Said she’d “have to educate the buyer first.” I told her I was educated, thank you very much.
Cashback fraud? “True” value is 140k, but seller will work with “creative” financing to get you the 30k cash at closing?
Orange County has a mini Silicon Valley, Irvine. Lot’s of high tech jobs down there. That might allow prices to stay high. However, that area will have a hard time growing if new people can’t afford to buy houses there.
as long as J6Pack can keep blowing off his increasingly precious dollars on high tech stuff that he doesn’t really need, all is well.
Ummm…
For every “mini-silicon valley” job, there were four higher paying subprime jobs in Irvine. Irvine is in *deep* trouble. Those subprime brokers bought houses everywhere. Twenty+ flips over $2.5 mill…
I love OC… wish I could live there. But its taking a hard haircut even as I type.
Got popcorn?
Neil
agree Neil, since I follow the market in OC, prices are coming down everywhere including Irvine.
Just saw an old house but well maintained in Mission Viejo, about 2200 sf, asking price 580k, now that is a number I havent seen in OC for a house that big in a while even if built in the 70s. maybe another 180k down and it would be worth it.
I actually work at one of those high tech jobs in Irvine, and I’m still renting in Anaheim. The salaries still don’t support the prices.
That might allow prices to stay high.
How many times does it have to be said… IF THE PRICES WERE NOT THAT HIGH BEFORE THE BOOM, THEY WILL NOT BE AFTER. Simple as that.
Those high tech jobs didn’t all just appear during the boom, and the salaries for them didn’t rise significantly either. It all comes back to fundamentals.
Of course, tech job DINCies can afford a low end home.
I am ready (and able) to offer em’ $100. Hope they won’t be too insulted. LOL In Sac, then maybe Arnold will come and welcome me back. Yeah, right. “I’ll be back”. No I won’t. At least not to call California home again.
The Mercury News. “The house in Silver Creek that real estate agent Nancy Vanegas will soon put up for sale has five bedrooms, views of the foothills, and is part of a growing category in the housing market: homes that fail to sell at foreclosure auctions and are repossessed by lenders.”
When this big development of McMansions on the south end of Silicon Valley opened people stood in line for an opportunity to bid on available homes. Now a five bed model, which is probably around the upper middle of the range, falls out of a foreclosure auction without a bid. The tide has turned we just need to wait for the ebb and the naked swimmers will be revealed.
they’ll have to add a new category at foreclosures.com etc……
failed to sell at auction
a “fatslac”
real-estate agent Richard Salinas: “The fish definitely are not jumping into the boat any more”
How telling, that the realtors think of homebuyers as fish. How very telling. For those who wonder why, “fish” is a term used by con men and gamblers to denote an easy mark, someone who is easily parted with their money. I believe it comes from the expression “like shooting fish in a barrel”…
“Bottomed”???
The party hasn’t even started yet in the bubble areas of CA, particularly the bay area. It’s going to take quite a while.
Spent last Saturday driving around Santa Clara county checking out home prices. We expect to buy 2008 at the earliest, and I want to comparison shop now to confirm prices are on the way down. They are. Lots of for-sale signs on most corners. Although, prices do not seem to be tumbling yet. We visited a few open houses where prices had been cut $25K.
Unfortunately, $25K is only 3% on these overpriced dives.
Fortunately, an additional 10% will be $90K haircut. Then, it will be interesting.
In SC you need to get back to 50% decline to get back to fundementals. We had nearly 400% increase….way out of fundementals. What was 180K is now nearly 600K in so so areas.