California's Real-Estate Tailspin

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Up to now, the booming housing markets in Los Angeles, San Diego and Orange counties had barely felt the chill that hit Miami and Denver from rising inventories, declining prices and slowing sales. But this week's spate of gloomy housing data included ominous reports from the West Coast. Led by an astonishing 799% rise in Los Angeles County, foreclosures in southern California jumped 725% in the second quarter, to a record 9,504, from 1,152 a year ago.

...

Bill Santoro, a broker with National Realty Group, has watched the end come for many clients, and it isn't pretty.

...

Santoro's territory, known as the Inland Empire, lies some 60 miles east of downtown Los Angeles. When the real estate boom started at the beginning of the decade, the Empire's Riverside and San Bernardino Counties stood as monuments to the American dream, affordable nesting spots for those priced out of the L.A. market. Migrant Angelenos found bigger homes on bigger lots in brand new subdivisions for as much as $100,000 less. Johnson says that in some of those developments, as many as 80% of the buyers were subprime borrowers and many of them first-time homeowners. Consequently, when interest rates started to rise, they were squeezed hard. Now the region is a symbol of the real estate slump.

Foreclosures in San Bernardino shot up 987% to 1,489 in the second quarter. In Riverside they jumped 793% to 2,509. That stock will soon be competing with a 13-month supply of unsold inventory that's already on the market.

http://www.time.com/time/business/article/...1647607,00.html

[AnaAndDaniel 0]

i am trying to figure out what it means for the 'rest of us'. ie those who are not in danger of foreclosing othe lenders in question.

Does it mean it is now is a good time to nbuy these house? are loans going to get extremely hard to get becasue of this mess? gov't bailout? any ideas?

Daniel

:energetic:

[Dan J 277]

It will be a good time to buy a house, pretty soon. I think I would wait for the price drop to bottom out a bit more. But yes, it will likely be much more difficult to get a mortgage without a down payment and good credit.

[Ban Hammer 12,836]

i am trying to figure out what it means for the 'rest of us'. ie those who are not in danger of foreclosing othe lenders in question.

it means meet your new neighbors

hopefully a government bailout won't be the solution. i get quite tired of seeing my taxes used to pay for someone's lack of judgement.

[Mr. Big Dog 10,747]

hopefully a government bailout won't be the solution. i get quite tired of seeing my taxes used to pay for someone's lack of judgement.

Amen!

[Sheriff Uling 3]

hopefully a government bailout won't be the solution. i get quite tired of seeing my taxes used to pay for someone's lack of judgement.

Amen!

Amen!

[brtlmj 0]

hopefully a government bailout won't be the solution. i get quite tired of seeing my taxes used to pay for someone's lack of judgement.

Amen!

Amen!

Amen! Many people got temporarily priced out of the market by others, who took loans they could not afford. I don't think their tax money should be used to make this permanent!