DataQuick: Largest Price Drop on Record
From the Sacramento Bee:
Median prices for August in Sacramento County were down 13.3 percent from the same month last year. DataQuick called it the county's biggest year-over-year decline since it began gathering statistics in 1988...La Jolla-based DataQuick Information Systems reported Thursday that median sales prices are now nearly 20 percent below their 2005 highs in Placer and Sacramento counties...DataQuick reported that the Sacramento County median sales price for new and existing homes combined was $312,250, the lowest since June 2004.
8 comments:
Question:
what do you call a 20% price drop from the 2005 record high?
Answer:
A nice start >; )
Median and mean for all you statistics buffs out there doesn't mean anything more than there are more lower priced houses on the market.
You really want to know how bad it is?
Look at what has happened to the price of specific properties to see how bad it is in some of the more bubblicious markets like Ghettomas and the Grove.
Go to flippersintrouble blog (link on lander's main page) and see how bad it really is.
You can thank irresponsible lending policies and practices, fraud, greedy ignorant investors and blood sucking developers (you can add more) for the bubble.
I was at a party last October. Greg Paquin was there and we were discussing what else - real estate.
I boldly stated that we would see a 30% decline from peak. He got a sour look on his face, shook his head and walked away.
Wow!
I wonder how the rest of the valley did.
The credit crunch which began the last week of July has really accelerated this downturn.
Right on, Gwynster. This thing is just getting started.
ARMs escalation likely to shoot down subprime borrowers
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/09/13/BUD3S4MRA.DTL
My summary: $40-50B in ARMs/month will reset in Sept, Oct, Nov, Dec and Jan, with the biggest spike coming next month. Some of these are prime ARMs and some are subprime ARMs.
When the Fed drops the funds rate next week, and probably again in subsequent months, it's not likely to help these ARM-holders much because 73% of subprime mortgages are tied to the Libor index which has been moving up recently, in the opposite direction of Treasury rates.
Also, The big time bomb is two-year ARMs that originated in 2006, when underwriting standards were at a nadir and home prices had started falling in many areas. These people are likely to have no equity in their homes and will have few options when their loans start resetting in 2008.
"median sales prices are now nearly 20 percent below their 2005 highs in Placer and Sacramento counties"
So were around 25% decline inflation adjusted.
Were right on track for a 50% decline by 2009.
Rio Linda, South Sacramento, Del Paso Heights, North Highlnads, Oak Park and the Norwood Area will see a 60% decline by 2009. Anybody who invested in these areas whether it be by direct purchase, Mortgage Backed, or Trust Deed Investment will lose a lot of money.
I am so tired of hearing about how bad the housing crisis is. The problem is that housing was so overpriced in some areas of the nation, it had to correct itself sometime. This isn't a crisis, it is a MARKET CORRECTION.
I'm sorry, seeing 1000 sq. ft houses sell for $350,000 is ridiculous, no matter where you are. Look at at the housing market in Spring, TX (suburb of Houston), Colorado Springs, CO, St. Paul, Atlanta and find out what housing "should" cost.
Sorry, but the concept of a couple making $150,000 annually and purchasing a $500,000 home is crazy to me. My wife and I make $175,000, live in a $132,000, 2500 sq. ft, 4 bedroom, 3 bath home in Colorado and pay $820 a month on a 15 year note. If people would just move away from these crazy places with crazy home prices, they might be able to save some money and get out of debt.
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