My wife and I are would-be Temecula knife catchers. We sold our San Diego condo in 2005 and parked the equity to wait out the crash. The new pricing in Temecula makes us suddenly feel semi rich, and the idea of buying a house we never dreamed of for slightly more than our house fund is intoxicating…
So, we’re waiting. Why? Because if cold-hearted rational people like us are tempted to knife catch, then the temptation must be utterly irresistable to most others. That means the recent flurry of buyers is just a natural increase in demand after a price drop. These buyers will be in infinitely better shape than the 2005-2007 crowd since the price can only drop another 20-30% (and that’s on the lower current prices). I imagine the new demand will exhause itself by July 20, and the heat will be 100+ degrees. I think by then my downside exposure will be 10%, and the advantage of being both settled in advance of the school year (our first is entering kindegarten) and holding a hard asset (think inflation) will be make the decision a weak “buy”.
