Randy wrote on Apr 8, 2008 3:27 PM:The financial mess we are in is going to last a lot longer and hurt a lot more people, contrary to the optimistic predictions of local real estate agents!

knifecatcher wrote on Apr 8, 2008 3:35 PM:Are the naysayers sleeping?

DisplacedAZ wrote on Apr 8, 2008 4:22 PM:Like Klinge said. Houses are going to sell but do not expect to sell your house if it doesn't have a view, or is not one of a kind. Houses that back up to other homes, or have plain jane landscaping are not going to sell.
The market is saturated and the cream is going first. once those are gone then the others will follow. But don't hold your breath that's going to be a long time from now!

When we bought last summer, our number one criteria was view. Do not show us house without a view. We were able to sell our house in Arizona in their awful market because we had a view and spend 200k (cost if I didn't do it) in landscaping. Tiger Woods and the PGA playing in our backyard helped a little too.

Mary wrote on Apr 8, 2008 9:50 PM:The reason why there is chocolate and vanilla is so there is choice. I personally could care less about a view and would not pay a premium for a view. Every house no matter what condition or location has a market price, it just a matter of the seller recognizing this sooner rather than later. Thus every house will sell, just not at the price most sellers thought they could get. Buyers are looking for deals and that may mean a great price on a fixer upper for some or a sunset view for another.

collapse wrote on Apr 8, 2008 9:51 PM:A perfect storm is upon us, a confluence of events not seen before: a global credit crisis, hundreds of billions of dollars of fraudulent loans being written off and outlandish home prices. No one in their right mind would buy, even if they can qualify for a loan. The current wave of foreclosures is not nearly over and now we have a full blown recession coming, possibly a great depression, with high unemployment. Don't let the realtors fool you. What is going on in the financial world hasn't happened since the great depression. This is not a mere correction; it's a collapse. This is a bubble popping and prices will never come roaring back. After home prices find a floor, prices will only rise with inflation, which really means zero appreciation. If you take on any kind of debt now, you are a fool, even if home prices drop to $200,000.

Roberto1 wrote on Apr 8, 2008 10:08 PM:Wow!...I thinking about buying another home...what a great time to buy a fourth home.

Investor wrote on Apr 9, 2008 6:59 AM:Geez NTC. You are losing credibility with me quickly. Quite getting input from Realtors. They are the least informed on the issues of real estate. It’s like talking to a ditzy receptionist about the financial health of a fortune 500 company. Sage advice would be, "what ever a Realtor says, DO THE OPPOSITE". Talk about the graph. This shows supply is heavy which will push prices down. I feel a lot further down to 2001 prices. Time will tell. The only time I will buy is when I see 6 months of dropping inventory and rising home prices. Until then, my investment money is off the table.

Wrong wrote on Apr 9, 2008 7:46 AM:Investor, Why would you want to wait for prices to start climbing again to buy? All you're doing is competing for properties with more buyers and more offers. That makes zero sense. Buy when you think bottom has hit; most often, that's when it's already passed you by. Home prices will never get below 2001 levels. NEVER.

REALTOR wrote on Apr 9, 2008 9:08 AM:I agree with Wrong. And, investor, no need to insult REALTORS because of the market. Also, your statement is one derived of ignorance, how can one make such a blanket statement?

I follow the market daily, and the foreclosures that are good deals ARE getting snapped up. If you could see the pending files, you would know.

Never will we see 2001 prices. What a thing to say.

Good luck with your smart investing.

John E wrote on Apr 9, 2008 11:59 AM:A realtor's job is to see real estate. What caused the current situation was people bidding prices unrealistically high. As my grandfather always used to say, "After every boom, there's a bust." What we have right now is simply a normal, but belated, correction in a completely overblown market. Since we are five years late this time, based on our two previous 10-year boom-and-bust cycles, we have a bit farther to fall.

Olaf wrote on Apr 9, 2008 12:01 PM:Your title says it all Realtor.... Your opptimism is evident. Why do you believe 2001 prices will not be seen? How could you know? Crystal Ball??? According to realtors "prices never drop in san diego"... I would never say where or how low any price is going to go but to guess in this market is crazy. Foreclosures are getting snapped up??? What area's??? In nice Beach areas maybe but try Chula Vista and other outer areas... So all in all it sounds like more advise from realtors getting a little wacky again... Typical!

clm wrote on Apr 9, 2008 1:12 PM:Who knows whether the market will go back to 2001 prices. It is always possible that it will. Any free market is prone to cycles of uneven balance in supply and demand. Speculation in the market and emotion, whether driven by greed or fear, can greatly amplify cycles. We can't predict that. The only thing we can predict is that eventually market forces will cause the pendulum to swing toward balance.

People need housing and Southern California, which already has burgeoning population from the coast to the mountains and beyond, will continue to grow relentlessly. Fundamentals are beginning to line up. In some cases, sellers who are speculating on a collapse or in dire need to sell are already including a large discount in their prices. Many others who are looking longer term and in a position to hold are willing to wait for higher prices. It is up to anyone interested in buying to study the market carefully. There are some good deals out there. It looks like there will be many more to come in the next couple years but don't believe those who think this market will last forever or that fundamentals will ever be the same here as in a rust belt city.

pending??? what a laugh! wrote on Apr 9, 2008 1:27 PM:Realtor wrote "If you could see the pending files, you would know."

Key word: PENDING

I'm guessing that today most "pending" sales never make it to escrow or quickly fall out.

mesapac wrote on Apr 9, 2008 2:14 PM:Wonder how long Collapse has been using this name and how long he's been renting? Your landlord loves your attitude. The lower priced properties are being snapped up by investors who actually are getting a positive cash flow. What else would you do with your money? Buy gold and sit on it? Buy stocks (certainly your doomsday scenario would say no)? Keep it in a CD account where inflation gives you a negative growth rate? If you sit on gold, you have to rent a house over your head to hold the gold. With average 2bdrm apartments up to $1295/mo across the County, up 4% from a year ago and in pace with inflation, you are guaranteed to lose. The floor on prices is when an investor can exact a positive cash flow and figure to raise rents on you next year.

Rob wrote on Apr 9, 2008 2:50 PM:Realtor wrote "If you could see the pending files, you would know."

Key word: PENDING

I'm guessing that today most "pending" sales never make it to escrow or quickly fall out.

Financial Expert wrote on Apr 9, 2008 4:00 PM:We are headed for 1995 prices. The perfect storm has arrived. What great news for buyers who saved and are ready with cash. Don't offer more than $100,000 for a house.

image009 wrote on Apr 9, 2008 4:26 PM:San Diego and everywhere else will go back to at least 1998 prices. DEFINITELY.

reality wrote on Apr 9, 2008 4:42 PM:Prices will go back to 3 to 4 times average annual income plus a 10 to 20% down payment. That's the historical average in San Diego. That puts a typical house price at about $200-$250,000.

desmo wrote on Apr 9, 2008 4:46 PM:Displaced AZ says:
When we bought last summer, our number one criteria was view.

A view? I would rather have a view of my all my finacial statements since I sold in 2005 and rented.

Wait to Buy wrote on Apr 9, 2008 6:08 PM:From what I understand, there are still alot of subprime loans that are resetting within the next year. This means more foreclosures to come. Wait until the dust settles with respect to this. What is your upside in SD real estate at these prices? What is your downside?

Fewer buyers can afford homes as lenders, etc. tighten loan guidelines. More tightening will come. Not many people have 20% cash down for a home. Most people are in debt to their eyeballs.

Recession is here. How bad will it get? Unemployment figures are rising. How confident do you feel about your job?

SD real estate prices need to get back to fundamentals. Renting versus buying on average is still way out of whack. Average income is still not high enough to support average home prices. No more funny loans to bridge the income home price gap. Real inflation running at 10% eating up lots of people's income.

I think real estate will overshoot on the down side as it overshot on the upside. Still way to early to jump in.

collapse wrote on Apr 9, 2008 6:24 PM:Mesapac, To be specific, I sold my 1097 sqft townhouse in July of '05 for $405,000 in Shadowridge, Vista. I pocketed a gain of $175,000 tax-free. (It's been growing ever since in foreign currencies.) And without a huge mortgage payment, I've maxed out my 401k contributions every year. The guy who lived next door recently died. His family put it on the market for $305,000, exactly like mine...no takers. Now there is a larger model listed for $299,000. Same street. I've owned three homes in Shadowridge but when the market got stupid, I sold. I didn't listen to guys like you who were saying prices can NEVER go down in San Diego; we got sunshine!! haha Now I'm laughing and you're still in denial. Every investment you mentioned would have been better than owning and losing a couple hundred thousand dollars in equity. Gold has doubled in price!! When I buy back into this market, I'll pay cash, no mortgage, no payments. I beat the system.

Bill wrote on Apr 9, 2008 8:11 PM:“‘I think we’ll see it (better sales) because the pricing structure is going to force the issue,’ said Chuck Smiar, a real estate agent in Escondido. ‘There’s a lot of buyers sitting on the fence waiting for the bottom. And I think if they don’t jump in soon, they’re going to be sorry.’”

Translation: If you don’t buy soon so I can have my 6% comission, you will be sorry as I will be in a really bad mood!

This used house salesman keeps saying the same thing to the local media as though he is trying to convince himself. Prices keep losing ground and foreclosures continue to pile up at an incredible rate, but his remarks about ‘missing out on the bottom/ being sorry’ keep going on, month after month.

I heard the exact same thing when prices were still going up wildly. He needs a new mantra, badly.

Smiar, Smiar, Pants on Fire!

Yeah…I’ll be real sorry I didn’t buy today w/ all the foreclosures coming on the market and inventory growing daily.

The entire statement is lame. If the supposed lot of buyers sitting on the fence don’t jump in, who is that will drive the prices higher and cause these fencesitters to be sorry?

collapse wrote on Apr 9, 2008 8:19 PM:For all you housing Polyannas out there, here is a report today from the International Monetary Fund or IMF, "Financial problems that erupted in August 2007 "spread quickly and unpredictably" and caused “extensive damage,” the IMF said. It described the financial shock as the biggest 'since the Great Depression.'"

Makes you want to go out and load up on some mortgage debt and buy a few of those bargains that REALTOR and MESAPAC are trying to convince you to buy.

KC wrote on Apr 9, 2008 9:06 PM:Realtor: I am so tired of hearing the prices won't drop to a certain level, it's a great time to buy, etc pitch. That is nonsense and a disservice to buyers. I lived in SD for 30 years. I've already lived through two housing bubbles. The only thing different about this one is that it is much worse. Here is an example of a house we bought in Vista in the early 1990s. Nice area, nice home in Shadowridge.

Orig LP $239,000.
Seller lowered the price to $199,000.
We purchased for $189,000.
Value continued to drop to $175,000.
It stayed at that value for 8 years.

You can do the math.
This is not speculation. This is a fact.

Lowball wrote on Apr 9, 2008 9:54 PM:Lowball lowball lowball the buyers set the market. We have been watching the market for two years & it continues to fall In Escondido houses that sold for 500k are dropping close to 300k along with other inland areas. The fall is not over so lowball or hang tight. The lenders have stopped giving loans to those who do not QUALIFY. REALITY SAYS WE AS A COUNTRY ARE HEADED FOR A DEPRESSION. DEFICITS DON`T JUST DISAPPEAR

collapse wrote on Apr 9, 2008 10:01 PM:It's the standard pitch that realtors learn at realtor school: play potential buyers on their emotional insecurities. When prices are going up, convince buyers that if they don't act now they will be priced out of the market. When prices are plummeting, convince them they'll miss the turn in the market and be priced out of the market. Would you ask a used car salesman if now is a good time to buy a car? Of course not. So why would you ask a used house dealer if now is a good time to buy a house? Of course they're going to say now is a great time to buy, just as they told the poor lady who bought my townhouse 3 years ago and who is now upside down in her mortgage by over $130,000.

sdguy wrote on Apr 10, 2008 12:01 AM:Anyone buying in this market will lose bigtime.Just look at the foreclosure #s and the amount of homes about to foreclose.Add the credit crunch,slow economy,job losses,commercial real estate woes as well.Not to mention all the bad loans where they will never purchase again.Inventories thru the roof.Prices dropped 23% ...Still a long way to go.
This "Correction" is only getting started.

Ford wrote on Apr 10, 2008 7:32 AM:Does anyone trust 6-percenters anymore? If you buy a house do not use a Realtor, at least not on both sides of the sale. These crooks need to go back to eating ramen noodles and get jobs at a fastfood restaurant. I also see the day that many realtors will get sued. A $400,000 home in Temecula today needs to come down to $200,000 before it is affordable, this is simply a fact, unlike the fantasy world people lived in for the last 5 years.

NewYorker wrote on Apr 10, 2008 7:36 AM:Subprime + Alt-A + ARM + liar loans + low interest rates + easy credit + good job market = Real Estate Boom in southern CA.

That's why the market was what it was at the peak. Now look at the equation above and see what's left on the left side of the equation. Nothing! CA is in for some serious economic pains. Not trying to kick you guys when you are down but the bitter truth is still better than the sweet lie. First, your state finances have been seriously mismanaged. State pension funds (remember Orange County?)over the state are in serious deficits and your state is going to have to cut public employees in big numbers for the next few years, or to renegotiate public employee contracts. Private sector jobs aren't faring much better either. China and India have grown up - they can do more sophisticated tech jobs now so the next few years are going to see tech sector bleeding jobs to the far east. The subprime companies like New Century and Ameriquest are no more. They are not coming back. Whatever left will be folded into small divisions tugged away deep within the east coast mega-banks. The only thing left really is Hollywood and the TV studios - but how many among you could be movie stars? So here is the new equation:

CA Government Deficits + high taxes + high costs + high job losses + credit crunch + foreclosure + US recession = Housing price down to the low of mid-1990s

And by the way, I was being generous by leaving out the looming crisis with global warming, forest fire and water shortages throughout the state. I love CA. The central coast is the most beautiful place within the continental US. But bitter truth - people - bitter truth.

Escondi-DON wrote on Apr 10, 2008 7:54 AM:Just look at the numbers folks - of Jan 08 house sales - vs jan 07 sales. Numbers do not lie.

Of the total of around one thousand sales in Jan 08 for San Diego, the number shows that over 600 were bank-owned (REO). 60% - so what does this mean? it means that the banks are now the resellers, and guess what...BANKS ARE NOT IN THE REAL-ESTATE HOLDING BUSINESS - and are ready to dump all these holding very soon. Housing price has nowhere to go but down.

Michael wrote on Apr 10, 2008 7:55 AM:Just look at the numbers folks - of Jan 08 house sales - vs jan 07 sales. Numbers do not lie.

Of the total of around one thousand sales in Jan 08 for San Diego, the number shows that over 600 were bank-owned (REO). 60% - so what does this mean? it means that the banks are now the resellers, and guess what...BANKS ARE NOT IN THE REAL-ESTATE HOLDING BUSINESS - and are ready to dump all these holding very soon. Housing price has nowhere to go but down.

michael wrote on Apr 10, 2008 7:57 AM:Ford,
For all I know, Temecula housing price already came down to 200 K - expect to lower more.

Ford wrote on Apr 10, 2008 8:50 AM:Michael, you could be correct. I hold a theory that prices will drop below 1999 levels even after adjusting for inflation. Inflation since 1999 is about 30% as evident in the loss in value of the dollar since then. I saw some nice homes in Tememcula in 1999 for $225,000. As foreclosed homes are dumped on the market, people lose jobs, commodities, energy, and just about everything else go way up, credit shrinks, and banks tighten standards including requiring 20% down - we could see that 1999 $225,000 home closing for $150,000.

And DONT USE a 6-percenter. If you need a realtor give them a case of Ramen noodles from Costco in lieu of a commission.

Jay Jay wrote on Apr 10, 2008 10:01 AM:The realtor method is to try to cultivate a sense of urgency in the potential buyer. Like an earlier poster said: If prices are going up, they say "Buy now or be priced out forever". If prices are declining they say "You can't time the market, you'll miss all the great choices and you'll miss the bottom."

They also like to emphase the that only special houses are selling, so you need to make your house special, not that its the lowest priced foreclosures selling.

The pending activity I'm watching is the foreclosures. I can see 4 months into the future via the recorders office and it ain't pretty. Lots of people's forced to sell or forcing the bank to sell when they are foreclosed on. This is how normalcy is restored to the market. Looks like I'll be getting a new neighbor this summer according to the notice of default filed last month.

Poster Collapse is my hero.

sdny wrote on Apr 10, 2008 10:22 AM:I don't think realtors should be allowed to call the bottom unless they called the top.

Michael wrote on Apr 10, 2008 10:46 AM:Realtors are sales people - which are peddlers of things, out to hustle honest folks, pretending to be professional. And sales people - who are they? Have you heard of snake oil??? saying anything to make a buck.

CAN WE EXPECT HONESTY, TRUTHFULLNESS FROM THEM????

Michael wrote on Apr 10, 2008 11:47 AM:Ford, or any one -

Do we have any study, or reseach to see the parallel of the current real estate market in the US/San Diego - versus that of Japan/Tokyo/Yokohama...? It should be interesting to see the similarity. As such, the housing price in Japan is still down and has not come out of the water for the last 15 YEARS - I need to capitalize YEARS for all of us to see the magnitude of this current market.
If I were an investor today - I would short all the financials institutions and bank stocks.
We have not seen any thing yet, THIS IS ONLY A START.

Ford wrote on Apr 10, 2008 8:23 PM:Michael, we will never emulate the Japanese model of 15 years of slow and safe decline. The US is not a single culture with a government that more-or-less cares about its people. The US is a giant corporation filled with greed and corruption and usury with a mixed population who minimally cares about the American culture and people. So expect more a wild west approach then a Japanese approach to unwinding the $5 trillion-plus bubbles. We will see collapses after collapse until the entire US hits rock bottom. The biggest bubble to collapses will be the government bubble such as schools, social security, medicare, etc.

If you have cash in US dollars, GET OUT. Invest in foreign companies, Swiss Franc, Yen and other successful currencies. Definitely invest in food and agriculture.

John wrote on Apr 10, 2008 9:54 PM:Realtor are commission-based salespeople and are rarely versed in fundamental economic principles.

The current realtor based system is a monopoly that stifles innovation and actively, often nefariously, keeps commission prices high.

The sooner open, online discount realty companies thrive and replace them, the better for everyone.

KirkH wrote on Apr 11, 2008 10:36 AM:"And prices are likely to fall further because many analysts consider the 11 months it would take to sell of all active listings in the region a deep buyer's market."

So prices are going to fall because of the massive inventory yet it's a "buyer's market"?

Can someone explain that to me, I think I'm missing something.

Sacramento wrote on Apr 11, 2008 3:53 PM:Sacramento's housing price already come down to 2001 level..... it has more room downward.....

silver lining wrote on Apr 11, 2008 7:49 PM:i just closed 3 foreclosures in great pockets in city heights, north park, and south park. all multi-counter and multi-offer (six offers or more offers)
all of these were one of a kind homes and deals. so wait till the market picks ups and wait till you see what you pay for them. these were all a month apart. all fixers of some sort and way underpriced. i even seen some successful flipping activity. location is key as were still landlocked especially in top neighborhoods. the beach is still doing much better than the rest of the county, yet that will always be the case. keep your eyes wide open as there is always opportunity. ps i'd be very careful of condos though as there's plenty of product, yet what floor and building may make adifference now vs later! never like chula vista as it never would end...

the dude

silver lining wrote on Apr 11, 2008 8:02 PM:there's lot of quoting escondido, vista, temecula, & other outer areas even sacramento. how about quotes in leucadia, carlsbad? I've seen some deals in great neighborhoods, yet far and few and maybe there'll be more maybe not many more. historically our economy was worst. tourism is still growing and yes the weather...

No money clown wrote on Apr 11, 2008 9:57 PM:I bought my condo in Kensington for $237,00 and now at least 10 are listed for under $100,000. The lowest is at $75,000 and they have not sold yet??? I'm sorry, very sorry!!!! I miss my apartment at La Mirage. The pool, tennis courts, gym, etc. I was living the life, unitl I met a Realtor.

Joe6Pack wrote on Apr 13, 2008 12:49 AM:"I think we'll see it (better sales) because the pricing structure is going to force the issue," said Chuck Smiar, a real estate agent in Escondido. "There's a lot of buyers sitting on the fence waiting for the bottom. And I think if they don't jump in soon, they're going to be sorry."

DUDE! Mr. Smiar...
You've been calling the bottom (that or trying to scare us into buying before "it's too late") since forever now! And prices have fallen 20-25% or more here in Escodido in the meantime.
What's up with that? How about advising your clients to list at a realistic price? Or are you going for "even a broken clock it right sometimes....?"

Joe wrote on Apr 13, 2008 1:18 AM:"I think we'll see it (better sales) because the pricing structure is going to force the issue," said Chuck Smiar, a real estate agent in Escondido. "There's a lot of buyers sitting on the fence waiting for the bottom. And I think if they don't jump in soon, they're going to be sorry."

DUDE! Mr. Smiar...
You've been calling the bottom (that or trying to scare us into buying before "it's too late") since forever now! And prices have fallen 20-25% or more here in Escodido in the meantime.
What's up with that? How about advising your clients to list at a realistic price? Or are you going for "even a broken clock it right sometimes....?"

mark m wrote on Apr 14, 2008 3:25 PM:I see corrections everywhere, except on the coast. Mission Beach, Pacific Beach, and La Jolla seem very resillient to change. Will this land ever correct?

fooled wrote on Apr 15, 2008 10:51 AM:haha, this post is funny. Obviously less funny for the poster, sorry man.
Never ever listen to realtors, they are just like used car or any other sales people, they'll tell you whatever to make a sale. It's not in their interest to do otherwise.

For instance, some realtors here say prices will never go to 2001 levels (they also said prices will never go to 2003 levels not so long ago). The fact is, even at current levels, prices are still about 25% above historical averages, so yes, prices will fall a lot more.

I bought my condo in Kensington for $237,00 and now at least 10 are listed for under $100,000. The lowest is at $75,000 and they have not sold yet??? I'm sorry, very sorry!!!! I miss my apartment at La Mirage. The pool, tennis courts, gym, etc. I was living the life, unitl I met a Realtor.

goldsheet wrote on Apr 17, 2008 10:51 AM:National Association of REALTORS® Membership Statistics, 1908 - Present
http://www.realtor.org/libweb.nsf/pages/fg003

Probably the best indicator of the housing market is the supply of realtors. From 1985 to 2001 membership was realtively flat in the 700,000 to 800,000 range. It then began to rise quickly getting over 1 million members in 2004 and peaked at 1,370,758 in October 2006. Membership is now 1,235,598 and dropping. When membership get back under 1 million, it might be a good time to buy.

REORealtor wrote on May 13, 2008 2:43 PM:Realtor -

"Never will we see 2001 prices. What a thing to say."

I love when 'experts' say 'never.' Like this market will 'never' crash. Or, 'You can 'never' buy real estate at the wrong time.'

Now I have to believe we will see 2001 prices, lol.

REORealtor wrote on May 13, 2008 2:55 PM:One other thing, take a good look at what's coming in the n.o.d. pipeline.

If you need to sell in the next few years, now's the time. By fall, it wont even be funny what's going on. The worst loans haven't really hit yet and when they do it will trigger a whole new group - owners that can make their payments but know it's possible to go ahead and buy a second home and let the first one go back to the bank, thus reducing their payments by half and eliminating negative equity.

They wont care about their credit because they already bought what they wanted and by the time the market corrects to where they can sell for a profit, their credit will be fine.

History repeats itself.