February 15, 2008

The last time California housing crashed, it fell 18.9% in six years. Well, it just fell 17.8% in FIVE MONTHS this time around. How low will we go?


Lasner has the latest numbers.

Be afraid. Be very afraid.

And if you bought a home in California 2004-2007, just turn in the keys and walk away now, you'll be much better off. You lost everything. Might as well face reality and make the best of it now.

The following numbers show County, Median, Fall from Peak, and Month of the Peak

Ventura $477,750 -24.2% 25 April ‘04
Riverside $331,500 -23.3% 13 July ‘04
San Bern $298,500 -21.4% 14 Feb. ‘05
Orange $520,000 -19.4% 7 April ‘04
San Diego $429,000 -17.1% 26 Feb. ‘04
Los Angeles $458,000 -16.7% 5 May ‘05
SoCal $415,000 -17.8% 6 Jan. ‘05

47 comments:

Anonymous said...

I wish I could feel sorry for those folks who bought in at the top. But somehow I just don't. The lenders who committed fraud to get them into those loans should go to jail.

Anonymous said...

The used car salesman told me it's a great time to buy a car. Who would know better about the auto industry than a used car salesman? I have to take his advice.

Anonymous said...

Snake Plissken for president!

Anonymous said...

I went to my bank today hoping to solve a recurring problem I have with late credit-card payments. I failed to convince the bank to lift some hefty penalties on my overdue balance, but, to my dismay, the agent gave me a broshure in which the bank was offering "100% financing" to home buyers, even to people "who cannot produce proof of income and a job certificate." Sounds like the US subprime fraud has spread like a bad epidemic all the way to North Africa where I now live. I thought the Atlantic ocean was vast enough to shield us from that disaster!
MAX

Anonymous said...

MARK IN SAN DIEGO


Check this out - hot off the press of the San Diego UT - RECORD Foreclosures again in January:

http://tinyurl.com/32kbcb

And record NOD's. . .this is just warming up

Agent #777 said...

if you bought a home in California 2004-2007, just turn in the keys and walk away now, you'll be much better off. You lost everything.

If you only have the Purchase Money Mortgage and you "bought" with no money down, since there is now no income component to the debt forgiveness, explain to me what have you lost?

Aside from your credit score and a little dignity, that is. But hey, so many are losing that these days.

chris g said...

I don't think that's showing the month of the peak for each county. I think it's actually showing the last time the median price was this low.

Anonymous said...

Fellow HP'ers, who else like me out there is getting wasted on fine Bordeaux from France right now while reading this blog and bitching "how bad are things"?

Anonymous said...

The math must be wrong there's no way - now way what-so-ever we can have loses like that and not have MSM on it, and panic in the streets, check your math maybe the decimal is in the wrong spot. Did you mean 1.89%.

Anonymous said...

http://www.mlsfinder.com/ca_sfar/lesliebauer/index.cfm?action=listing_detail&property_id=335549&searchkey=1f512b75-a9c6-be94-321e-4b363f2164e8&npp=10&sr=1

$1.2MIL FOR CONDO ON SANFRAN
THATS THE SAME PRICE A YEAR AGO

PRICES YET TO COME DOWN

WHEN WILL REALITY SET IN?

THE RICH ARE NOT SWEATING

Anonymous said...

I sold my house in Riverside the week before the peak. I wish i could say that i invested it all in gold but i was gunshy after loosing my butt on the last gold rush. But i did invest a lot of it in asian currencies and food and the new american currency... Ammo.

BMW driving sex machine said...

Can some of those losses start happening in Seattle? Real estate here is atleast 30% overvalued right now.

the_other_max said...

the agent gave me a broshure in which the bank was offering "100% financing" to home buyers, even to people "who cannot produce proof of income and a job certificate."

Learn from the lessons in the US and take the loan, enjoy your life for a year or so, relax, take a vacation with a home equity loan, which is the next thing they will probably offer you.

Then, if you are still lucky to sell higher, sell and retire. If not, just toss the keys in the air and walk away.

Jeff said...

I am in Palm Springs winter vacationing... prices are tumbling here... when might be a good time to buy? Condo or SFH?

Tyrone said...

Snake Plissken?... I thought he was dead.

Anonymous said...

i lived in SoCal my whole life, and i can say the in the 90's although the offical numbers were down 18% or whatever, there were certainly neighborhoods that had 50%+ price declines. I remember the MSM mentioning Encino in particular dropping 50%, but there we certainly many more.

Harsh Realty said...

House prices have fallen farther than the stock market. In our new reality, stock prices are sticky on the way down while house prices are not.

Anonymous said...

The government is allowing FBs to not pick up the cancellation of debt income so now is the time to take advantage and get out of that toxic debt while you can.

This opportunity may go away after the elections and the cold hard reality of a corrupt complex is exposed.

You have to think of it as a bad investment. When prices come down to reality we can all buy again.

Frank@Scottsdale-Sucks.com said...

All I know is this - I'm moving next week because the deals have gotten just too damn good out there.

The bottom line is we're moving into a MUCH nicer place that's also nearly 600 square feet larger, with stunning city and mountain views, and newer (built in 2004 vs. 1993 for this McMansion) and saving a total of $900/month in the process.

When rents drop that much you know the housing values are WAY down. And you know the rental market is bad when we requested credit reports and financials & mortgage records from the owner and he happily complied. And, landlords in CA have gotten ULTRA strict on credit, meaning even a few late credit card payments will disqualify you, so I don't know how these walk-away foreclosure jerkoffs plan to get a place to live.

Anyway, this is an exciting time to be a renter and non-owner knowing how great the deals will keep getting. Probably gonna buy next year, two years tops.

Anonymous said...

Lets be clear. Buyers in these situations seldom have "lost everying" ... its the banks. Walk away because you can do BETTER to buy a cheaper home, and to hell with Citi, CFC, B of A, WAMU, Downey, etc.

Anonymous said...

Well lets hope this means the regression to the mean will happen more quickly.

The sooner we get this over with the sooner we can move forward

Anonymous said...

Lenders in my zip code now, best SF zip want at least 20% down now. They are working by zip code, most SF they want 25%.

the mortgage guy said...

Anonymous said...

The lenders who committed fraud to get them into those loans should go to jail.
------------------------------

It's not lender fraud when product matrices specifically allow for stated income, stated assets, no income, no assets, no job.

These matrices are based on what Wall Street will buy. Wall Street is the final arbiter of loan guidelines and underwriting.

If you want to condemn anyone for fraud, condemn Wall Street. They are the biggest criminals along with the ratings agencies, in this whole debacle.

Who wouldn't want to buy an investment that is as safe as a Treasury bond with twice the yield? Everyone would want such an investment. One problem is such an investment doesn't exist. The other problem is Wall Street peddled the mortgages as such.

None of what we are witnessing today in our economy could have been possible without Wall Street's fraud. None of it.

The real criminals are the investment banks that securitized the mortgages. They had the money and those who have the money make the rules.

They had help too. The due diligence firms and ratings agencies all gave them their blessings in committing these heinous crimes.

price discovery said...

What's wrong with the Bush and Clinton plans to suspend foreclosures.

http://www.slate.com/id/2184488/nav/ais/

devestment said...

I was there the last time California crashed and it was 25% in wealthy areas and 50%+ in poor areas and the sticks.

devestment said...

Let’s hear reports from posters on the overall economy Keith. There are several facets to my business, here is my report.

#1 Fabrication of decorator home products. My material suppliers are slow and asking me for work; just last year they did not have time for me. Raw materials prices are up while demand is down.

#2 Antique Shop. Rents are up but sales are down. Sellers outnumber buyers, few bargain hunters.

#3 Bullion and scrap metals buyer. Boy is it pouring in, people are selling.

#4 Craft and repair supplies. Plenty of demand as projects abound.

#5 EBay seller. Fees up, sellers pissed, lots of junk and little quality.

Anonymous said...

California metros with foreclosure rates in the top 20 were Riverside-San Bernardino at No. 4, Sacramento at No. 5, Bakersfield at No. 7, Fresno at No. 14 and Oakland at No. 16.

In Sacramento, Calif., prices fell 18.5% to $197,600.

sandman said...

Keith,

I know you've been thinking things are looking cheap. But I think this article helps.

The Wile E. Coyote housing market

By Jeff Ostrowski | Wednesday, February 13, 2008, 01:36 PM

ORLANDO — David Seiders, chief economist for the National Association of Home Builders, gave a gloomy outlook for the housing market during a presentation today at the International Builders’ Show.

He showed a chart with housing starts plunging after 2005 and offered this one-liner:

“This really does look like something out of a Warner Bros. cartoon, where Wile E. Coyote has fallen off that cliff and still hasn’t hit bottom.”

Still, Seiders is an optimist. He expects the single-family housing market to hit bottom later this year.

Give it a little more time... and hold... then BANG

Anonymous said...

California has a long way to go from here.

you asked if HPers were glad we didn't buy a house during the bubble. Well, I'm glad I didn't move to the west coast when my friends there were trying to convince me that prices would keep going up forever because no one wanted to live in flyover land anymore.

pwnd said...

potential buyers of property and securities being liquidated need to be incentivized by greed – the knowledge that they are paying prices below intrinsic value, which implies upside price gains in exchange for giving up the liquidity of always-trades-at-par cash.

Anonymous said...

Bush Administration Hides More Data, Shuts Down Website Tracking U.S. Economic Indicators

The U.S. economy is faltering. Family debt is on the rise, benefits are disappearing, the deficit is skyrocketing, and the mortgage crisis has worsened. Conservatives have attempted to deflect attention from the crisis, by blaming the media’s negative coverage and insisting the United States is not headed toward a recession, despite what economists are predicting.

The Bush administration’s latest move is to simply hide the data. Forbes has awarded EconomicIndicators.gov one of its “Best of the Web” awards. As Forbes explains, the government site provides an invaluable service to the public for accessing U.S. economic data:

This site is maintained by the Economics and Statistics Administration and combines data collected by the Bureau of Economic Analysis, like GDP and net imports and exports, and the Census Bureau, like retail sales and durable goods shipments. The site simply links to the relevant department’s Web site. This might not seem like a big deal, but doing it yourself–say, trying to find retail sales data on the Census Bureau’s site–is such an exercise in futility that it will convince you why this portal is necessary.

Yet the Bush administration has decided to shut down this site because of “budgetary constraints,” effective March 1:
econind.gif

Economic Indicators is particularly useful because people can sign up to receive e-mails as soon as new economic data across government agencies becomes available. While the data will still be available online at various federal websites, it will be less readily accessible to members of the public.

In its e-mail announcement on the closing of Economic Indicators, the Department of Commerce acknowledged the “inconvenience” and offered “a free quarterly subscription to STAT-USA®/Internet™” instead. Once this temporary subscription runs out, however, the public will be forced to pay a fee. So not only will economic data be more hidden, it will also cost money.

It’s ironic that the Economic and Statistics Administration is facing “budgetary contraints,” considering Bush recently submitted a record $3.1 trillion budget to Congress for FY ‘09.

tim73 said...

This is big news:

"One of government's chief internal watchdogs resigned yesterday, as Comptroller General David M. Walker, an outspoken gadfly and frequent witness on Capitol Hill, announced his plans to lead a new foundation focused on U.S. fiscal responsibility."

MR. WALKER HIMSELF IS WALKING AWAY!
This c**p gets more ironic day by day.

Anonymous said...

News:

U.S. GAO Comptroller General quits... or was he fired?

"One of government's chief internal watchdogs resigned yesterday, as Comptroller General David M. Walker, an outspoken gadfly and frequent witness on Capitol Hill, announced his plans to lead a new foundation focused on U.S. fiscal responsibility."

Also check out this government web site:
http://economicindicators.gov/

Due to budgetary constraints, the Economic Indicators service (http://www.economicindicators.gov) will be discontinued effective March 1, 2008.

DaveO said...

I thought that house prices never went down, and that bubbles are for bathtubs.

Anonymous said...

"It is perfectly possible for a man to be out of prison, and yet not free - to be under no physical constraint and yet to be a psychological captive, compelled to think, feel and act as the representatives of the national state, or of some private interest within the nation, wants him to think, feel and act.

"The nature of psychological compulsion is such that those who act under constraint remain under the impression that they are acting on their own initiative. The victim of mind-manipulation does not know that he is a victim. To him the walls of his prison are invisible, and he believes himself to be free. That he is not free is apparent only to other people. His servitude is strictly objective."
Brave New World Revisited, Aldous Huxley, 1958

EG said...

You forgot to put the worst area in the state and the country - Sacramento.

Anonymous said...

Keith,

Its been awful here in the Inland Empire and seems to be getting worse by the week. I truly believe we could be down 40%-50% by this Dec. The numbers have so far been proving all my claims correct about this area. We have just about entered the panic stage.

I have never seen so many empty homes out here in my life. This is a tragic turn of events.


ICEMAN

Anonymous said...

I am not sure what is going on here in the North East, but it seems to me that NY and NJ are weathering the housing crash pretty well.

I have only seen a few home for sale here, and some that have lost their homes. As a matter of fact the house in front of my place seems to have been a "walk away", I think. The family just picked up and left from one day to another. Other than that, not many homes for sale here in the garden state.

Danny

Anonymous said...

omg omg omg, you boys are soooo gonna love this forum of dumb women talking about their financial shortcomings. Lots of gems in there, along with the usual lack of accountability and feeling of self-entitlement. None of those women think that they're part of the problem, as they blame their mess on everybody else. I'm sooo special! Here are so excerpts:

"Sylvia and her husband, Joe, were a suburban couple who seemed to have it all. They had four beautiful children, lived in a large five-bedroom home, wore the latest clothes and took luxurious vacations. "I wanted a big house; I wanted a big family. I wanted to live comfortably," Sylvia says.

The playroom overflowed with toys, and everyone's closets were jammed with clothes. "If they wanted to get something, if I didn't have enough money, I put it on a credit card," she says. "If you looked through my closet, I have things with tags on it I haven't even worn yet. It didn't matter if I had 10 pairs of jeans, I'd still buy a pair of jeans cause it fit good."

Sylvia says she never thought her family would have money problems…until Joe's spending spiraled out of control. Instead of paying the mortgage, Sylvia says Joe bought a motorcycle. "He just was reckless spending," she says. Eventually, Sylvia lost track of Joe's bills. "He starting taking the mail away so I couldn't see what he was spending on," she says. "I was very scared. I was afraid that we wouldn't be able to pay the mortgage."

Sylvia never imagined she would lose more than her home. After returning from a weekend away with the kids, she discovered her husband had killed himself in their garage. The next day, a stunned Sylvia learned Joe had canceled his $300,000 life insurance policy three months before. He had also stopped making all mortgage payments.

Sylvia had only $72 in her checking account. With no savings accounts or retirement plans to fall back on, Sylvia faces $450,000 in mortgage debt, $17,000 in her own credit card debt and another $40,000–50,000 owed on Joe's credit cards."


http://tinyurl.com/2l7kho


"Three short years later my husband was let go. The company's structure changed and because his presence was not made on a daily basis, the new corporate officers didn't know him. After 8 years of sacrificing weekends, vacation time and traveling more than 200 days out of the year, he was fired. He was given two months severance, that's it. The new home we had just purchased had a brand new mortgage we could no longer afford.

Many times my husband and I had cereal for breakfast, lunch and dinner in order to pay the electricity, but many times it was cut off. Our phones were disconnected and the car I used to travel to work each day was repossessed. Friends and family never noticed our struggle because we knew they always had had less then we did, how could we ask them for help. I remember being hungry at work because I had no money for lunch, even though I made $30,000 a year.

How easily we lost everything, in a matter of two years a family making over $300,000, property owners and good savers came a month short of becoming homeless.

Now we still live from pay check to paycheck, after 5 years we still cannot catch up after the damage that was done, but we have no credit debt, we can afford the home we live in and we have more then cereal in our bellies each night."


http://tinyurl.com/2j64sw


That's Obama's base pushed by Oprah. The movie Idiocracy is a reality. God help us all!!!

Lost Cause said...

No, Dave, the high end got hurt the worst the last time. And it was the last to recover. And it will be the last to drop this time.

Anonymous said...

I am not sure what is going on here in the North East, but it seems to me that NY and NJ are weathering the housing crash pretty well.

Why would anyone choose to live in the two most taxed states in the US after Connecticut is beyond me. Some people just love to piss money away.

No but no thanks. I like to keep my money to keep it away from welfare parasites and crook politicians.

Frank@Scottsdale-Sucks.com said...

I was there the last time California crashed and it was 25% in wealthy areas and 50%+ in poor areas and the sticks.

Here in Newport Beach the local paper keeps talking about how the crash is confined to "bad" areas and the wealthy coastal communities are barely hit, but in reality prices here are down almost half to when I started visiting here in 2005. Houses were selling in days for $1,100/sq ft and now there are listings under $500/sq ft starting to show up.

Let’s hear reports from posters on the overall economy Keith.

All I know is my business is uniquely positioned to do better in a recession than in good times, and business is exploding right now. Like seriously insane - I had to move distribution to a larger facility and my speaking schedule is booking up fast, just got one in Singapore and a 3-day tour in South Africa for crazy high fees.

(In case you're wondering, I help business to market better, meaning they don't call me when everything is great, but when it gets bad everyone wants my help.)

Anonymous said...

Great time for us bottom-feeding types, lol. By end of 2008, there will be cheap houses, cheap cars, and cheap loans for them both with damn near 0% fixed interest.

Anonymous said...

Anonymous DaveO said...

I thought that house prices never went down, and that bubbles are for bathtubs.

February 16, 2008 4:32 AM
---------
Nope, but Kendra Todd was made to be bent over in a bath tub filled with bubbles!

NY-is Hell said...

I've lived in NY for 41 years, 41 of which I hated - NY sucks - I'm glad NY is going broke - poetic Justice!

jeff said...

I think those dates are the price we're back to?... wasn't the peak in 2006?

Anonymous said...

PARDON ME IF I DO NOT USE CASH THAT CAN BUY ASSET BACKED INCOME GENERATING BSINESS BONDS THAT AUCTION OUT AT YEILDS OF 20 PERCENT AS I TRY TO USE THAT 20 PERCENT TO BREAK EVEN ON THE HOUSE PRICE INFLATIONS ON THOSE 100,000 DOLLAR HOUSES HOUSES, OF HOW MANY YEARS AND AT HOW MANY YEARS...