California Dreamin': The house you couldn't afford

[c1ue]

Despite moratoria and what not, economic gravity still asserting itself in the Fruit, Nut, and Flake state

http://blogs.wsj.com/developments/20...-in-california

The 90-day delinquency rate on dues for the 260 homeowner associations in California managed by Merit Property Management jumped to 5.3% in March from 2.8% last June. Delinquencies first spiked to 2.6% in December 2007 from 0.8% in March 2007.

[swgprop]

Re: California Dreamin': The house you couldn't afford

The fun is just getting started!

From DoctorHousingBubble

Take a really close look at this chart. Do you see in the chart how in Q4 of 2006 notice of defaults (NODs) started spiking off the charts? This was the canary in the subprime coalmine telling us to gear up. Yet people kept on buying only to see the market collapse in 2007 and 2008. It was a warning sign. Many pundits in the industry point to the Q3 and Q4 2008 drop in NODs and foreclosures yet fail to mention one thing. This was a government sanctioned moratorium. Sales did not increase by any sizeable portion to justify the fall. What caused this drop was artificial.
The artificial propping up is now completely gone. That is why for Q1 of 2009 we are witnessing the largest amount of NODs in the history of California real estate. I wish that were hyperbole but that is simply the fact. What this tells us is a tsunami of inventory is going to be flooding the market in late 2009 and early 2010. Keep in mind, most of the subprime waste has washed through the system. That battle is largely over. The next big issue is the Alt-A and Pay Option ARM fiasco. And many of the properties with the Alt-A and Pay Option ARMs are in more middle-class to upper-class areas. So what is the point you ask? The point is, many of the great deals people are seeing at the lower end of the market are because of the flood of foreclosures and REOs. Yet the middle to upper priced areas have yet to see any significant movement down. All we know is that a flood of inventory will be hitting these areas. Simple economics will tell you that more supply and equal or less demand usually will mean lower prices. There is absolutely no rush to buy a home right now.

[FRED]

Re: California Dreamin': The house you couldn't afford

Despite moratoria and what not, economic gravity still asserting itself in the Fruit, Nut, and Flake state

http://blogs.wsj.com/developments/20...-in-california

Maybe the bankruptcy rates are an indicator? CA tops the list with a 94% increase between 2007 and 2008. AZ is no. 2 with a 79% increase.