Nationwide, chances of housing prices dropping is highest in San Diego
By Roger M. Showley
STAFF WRITER
November 5, 2006
San Diego County has a 60.3 percent chance of lower housing prices over the next two years, the highest chance in the nation, according to an analysis by PMI Group, a mortgage insurance company in Walnut Creek.
The number is based on the finding that local housing appreciation tumbled from a rate of 19.6 percent in the second quarter of 2005 to 5.5 percent in the second quarter of this year, coupled with the area’s low affordability index of 68.1 (100 is defined as affordable) which was offset by a low unemployment rate of 3.9 percent.
I’m not sure this survey is all that accurate. I have a friend in Indianapolis who tells me that 2 of his colleagues are sitting on unsold “investment” properties and facing big losses. Yes, they were gambling on RE in the heartland also.
I like to go to Ben’s blog, and just scan the headlines. Sometimes I have time to read his whole post. My reaction is usually shock. Weird, I know since we’ve all been reading about this for over a year, but everyday there’s another negative story, and everyday I am just as shocked, with sometimes a little sadness thrown in, and others, a little amusement. Mostly I come away from an article saying, “Unreal!”
Orange County is considered only very slightly less risky than San Diego, and Los Angeles is only slightly less risky than Orange County. Look at the regional risk of all three counties together!
In Orange County “conventional wisdom” has been that the market did not as crazy in the OC as it did in San Diego, so it would not fall as far as the San Diego market.
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