Friday, June 20, 2008

Sacramento Job Growth Goes Negative, First Time Since 90s

Another milestone in the Sacramento housing bubble saga. From the Sacramento Business Journal:

Greater Sacramento saw total industry employment fall by 3,700 jobs from May 2007 to May 2008, helping to push unemployment in the region to an estimated 6.4 percent, the state Employment Development Department reported Friday. It was the first year-over-year decline in that statistic since 1993.
From the Sacramento Bee:
Sacramento unemployment is the highest since early 1997.
From the New York Times:
Banks that issue cards like Visa and MasterCard, as well as the American Express Company, are cutting the limits for customers who have run up big debts, live in areas that have been hit hard by the housing crisis or work for themselves in troubled industries.
...
Pamela Pfitzer, a family therapist with a stable six-figure income, was stunned when she went to a garden center near her home outside Sacramento in early April and tried buying about $30 worth of flowers with her American Express card. Her transaction was denied, she says, even though she had just made a $1,000 payment and almost never missed one in her life.

It turned out that shortly after falling behind on a mortgage payment and being hit with a tax lien, American Express had lowered her credit limit to $900 from $2,300. The flowers pushed her over the new cap. Then last month it happened again, she says, when she tried to buy office furniture with her Wells Fargo Visa card. Although she had just made a payment of about $700, Ms. Pfitzer found out that her credit limit had been lowered to $2,000 from $2,800.
From the Modesto Bee:
Another Modesto title insurance office is closing, continuing the escrow industry's exodus from Stanislaus County. The North American Title Co. will shut its last Modesto office July 18. It previously had closed its Turlock office. Two weeks ago, Fidelity National Title Insurance closed its Modesto office, laying off some employees and merging the rest with a pared-down staff from Chicago Title.
...
"What we're seeing is a huge consolidation in the industry," said David Bakken, president of the San Joaquin Valley Escrow Association. "There's probably only 25 percent (of escrow officers) left."
...
"It's a very scary time for all of us, and it's not over yet,"...Debbi Zimmerman, a 23-year industry veteran...warned.
From the Sacramento Bee (hat tip DJ):
A U.S. Justice Department crackdown on mortgage fraud that helped seed the nation's housing downturn has netted 400 industry players since March, including five from Sacramento, officials announced Thursday.

4 comments:

Randy said...

"Pamela Pfitzer, a family therapist with a stable six-figure income, was stunned when she..."

Sounds like some well-off person that can't handle her finances and making a SOB story.

HousingRealist said...

I would not consider "six figure" income well off. 110K is not well off. 250K/400K That's well off!

Patient Renter said...

I would not consider "six figure" income well off.

Maybe it's not well off to you, but look at the median income. It's plenty well off.

David said...

"shortly after falling behind on a mortgage payment and being hit with a tax lien"

So if you are falling behind on your mortgage and having tax issues, why are you buying furniture and other unnecessary things? Classic case of can't control your spending from what I see.