Forbes: Central Valley's Incredible Shrinking Home Equity
From Forbes:
Cities in California are particularly hard-hit. In Modesto, Sacramento, Riverside, Vallejo, San Diego and Stockton, homeowners have lost 50% or more of their home equity in the last year. Price declines--most significantly in Modesto, where prices are down 38% from last year--combined with second mortgages and low down-payment loans have tapped home equity.BBC Radio: Stocktonians on the housing bailout
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In California's Central Valley, one of the nation's foreclosure epicenters, it seems that the only real estate brokerage business with potential buyers to spare is Repo Home Tours, a bus operator that takes weekly jaunts through the hard-hit neighborhoods of cities like Modesto, Calif., showing passengers hundreds of potential bargains in one afternoon.
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[B]ased on current homeowner equity figures, it's unlikely these tour operators will go out of business anytime soon. Prices are down 38% from last year, based on Trulia.com data from California's multiple listing services, and the state of the housing market has had a formidable effect on homeowners' net worths: with home equity at just 19% of home value, it's the most depressed housing market in the country. At this time last year, homeowners had 57% of their home's value in equity.
U.S. Households Losing Home Equity Fastest:
#1 Modesto
#2 Sacramento
#8 Stockton
#13 Merced
America's Most In-Debt Households:
#1 Modesto
#7 Sacramento
From the Manteca Bulletin:
The housing gods must be crazy. Now - in some cases- it is substantially cheaper to buy a home in Manteca than to rent an apartment.
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Realtor Tom Wilson noted that the current Manteca housing markets driven by foreclosures is shaping up more and more as "an opportunity of a lifetime" for first-time buyers as well as investors. "First-time home buyers who are taking baby steps like their mom and dad did are doing quite well in the market," Wilson said. "I imagine those who bought baby McMansions a few years ago as their first home are wishing they hadn't.
6 comments:
Realtor Tom Wilson noted that the current Manteca housing markets driven by foreclosures is shaping up more and more as "an opportunity of a lifetime"
Uh huh. Only for those who've had very short lifetimes.
I imagine those who bought baby McMansions a few years ago as their first home are wishing they hadn't.
I love how this guy knocks people who bought a few years ago, then goes on to say buying right now is the opportunity of a lifetime. Was he really one of the few voices in the industry not cheering everyone to buy a few years ago? Doubt it. Will he knock today's buyers a few years down the line? Probably.
The word hypocrite comes to mind.
"First-time home buyers who are taking baby steps like their mom and dad did are doing quite well in the market," Wilson said. "I imagine those who bought baby McMansions a few years ago as their first home are wishing they hadn't.
In two years you will be able to say the same thing about people buying now...
And what is a baby mcmansion anyway? A normal sized home?
So lets see about Sac. Low home equity, high debt... If we went from 50% equity overall to 19% in a year, can we be negative next year?
In the 30s there were several generations who were scared to death, and still are today, to put money in the bank or invest in stocks. I wonder if this current generation, and those after, will bet the farm on housing again. I really see some distrust in the financial markets and housing again. We won't see 2006 RE prices again in our lifetime in Sacramento.
Modesto, Sacramento, Riverside, Vallejo, San Diego and Stockton, homeowners have lost 50% or more of their home equity in the last year.
Were right on track for a 60% decline by 2009.
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Lander you should exempt this language for just one day.
Why change to 60%? I think the math is playing games with you. Unless the average person had their house paid for, the deline % would be less than the home equity loss %.
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