"The Numbers Are The Numbers"

From Business Week:

Houston, you have a problem—with housing inventory. And as the number of homes for sale in the country continues to creep upward thanks to waning demand, many other major U.S. cities are dealing with the same issue...The housing supply is particularly bloated in Los Angeles, Chicago, and Miami—the top three on our list of the cities with the biggest housing inventories based on data from San Francisco brokerage ZipRealty (ZIPR). Tampa, Phoenix, Washington, Dallas, Boston, Sacramento, and Houston form the rest of the top 10.

From the Sacramento Bee:

Upon buying a house in the Sacramento area recently, [first-year coach Reggie] Theus told Kings co-owners Joe and Gavin Maloof that they'd better not ponder the idea of making a third coaching change in four years. In this real estate market, especially, it's just not the time to sell.

From the Modesto Bee:

Many borrowers believed the people they were dealing with had their best interests at heart. If that single-income family of four couldn't really afford that 3,000-square-foot house, one of those professionals would warn them off. But that's not really how it works. Business is business; it's not personal. People are in business to make money, and consumers have to look out for themselves.

Bob Endsley, founder of Coldwell Banker Endsley and Associates of Turlock, believes people were taken advantage of. "They were talked into low teaser rates and told they can't go wrong. If those loans had not been available, the demand for houses wouldn't have taken off like it did, and we probably wouldn't be in this mess."

So where do we go from here? Clearly the market is in turmoil. One of the things driving the downward spiral these days is people's attitudes. But don't blame the messenger, that's just an easy out -- the numbers are the numbers. Being better informed just makes for better consumers who make better choices. Everyone wants that, right?

"People need to make more prudent decisions," Endsley said. And the best way to do that is to learn as much as you can about the marketplace, understand your own financial situation so you don't overextend and take your time making such a major decision.

From the Modesto Bee

When the market was at its peak, Kimiko Horiuchi avoided buying because prices were too high. Now, she and her husband are buying a 2,700-square-foot house in Patterson for $329,000. She said her real estate agent told her that a few years ago the home was worth $600,000, because it's a former model home with several upgrades. "We're definitely getting a home for a good price," said Horiuchi, 28, who will move from Tracy into the new house in early November. "You're going from renting to paying on the mortgage, and if the economy comes back, then I'll have a house that I bought for less than it's worth."

Buying the house comes with some tradeoffs. She'll have to add about 25 miles to her commute to her job as a patent legal assistant in Sunnyvale and still will take her sons to school in Tracy.

Horiuchi said she knows she may be taking advantage of someone else's misfortune or bad loan. "I just feel bad that I'm taking someone's house," she said.
...
Although many trends point to prices sliding more before they rise again, experts said it's not necessarily a good idea for a buyer to wait. Too many homes at cut-rate prices will spur the return of lots of buyers, including investors who were partly responsible for making prices soar in the most recent boom. And interest rates aren't likely to drop much more.

Northern San Joaquin Valley: Change in Median Prices From Peak [pdf]