Given that foreclosures are skyrocketing and ARMs will be resetting well into 2009, I doubt we are poised for a recovery anytime soon. Not to mention the rampant overbuilding and mortgage fraud in outlying areas (like Temecula).

Combine that with a local economy that is over-dependent on RE and its associated industries. I simply don’t see where the huge influx of buyers are going to come from, especially given the tightening lending standards. Even for the few high-paying jobs that are here, most folks are not going to be willing to relocate due to the high cost of living.

There are two things that I think may create an early bottom.

1. Cash-rich renters that sold during the peak and are waiting to buy back in. I call this the “Piggington Effect”. They are flush with equity and can afford to buy an overpriced asset if it means getting into the kind of house they want.

2. Wealthy people in other states that dig SD and want to buy a vacation home here. They will have no shortage of condos at bargain prices over the next year, for example. As you can see from Rich’s employment charts, leisure is big business in this city.

Beyond that, its gonna be a slow decline until the regular folks with stable income and good credit (like me) can even afford a starter home and start buying.

I have posted this chart many times before, its the credit suisse Arm Reset schedule. It supports what much of Kewp is saying regarding ARM resets. Also it shows how the Bear Sterns story could be the beginning of a much bigger story in regards to the subprime debacle. I don’t see this thing rebounding after a trough in 2008. I think you will see rebound articles throughout this entire downturn until there is actually a rebound. IMO we won’t see a possibility of that until 2011.

http://www.bubbleinfo.com/statistics-2007/2007/3/15/arm-reset-schedule.html

I dont see that happening at all Myito.

SD Realtor

Reads like NAR fluff to me. You know, the folks who said prices were going rise last year. and then this year. wait, maybe next year.

Oh, and I think you can expect an L-shaped recovery at best (whenever it finally does happen). 5.3%? That’s funny. The even bigger laugh is Phoenix’s recovery (Q4 2008,7.7%).

That moment has passed in Seattle and in Charlotte, N.C. Both metro areas hit bottom in the first quarter of 2006 and have since posted price gains of 12.3% and 6.3%, respectively, according to National Association of Realtors (NAR) data.

What do you think of this article?  All the "data" is quoted from NAR.  I see Lereah is out and Yun is in.  Same message apparently.  For instance how is the 12.3% and 6.3% measured, or what does it even mean? 

It’s amazing what these guys will say isn’t it. OC Renter had a good post on Seattle last week

http://bubbletracking.blogspot.com/2007/06/seattle-surprise.html

Decreasing sales and rising inventories, sounds like a rebound to me. Why do they say these things when they are so easily debunked?? I have a feeling this Yun guy is just a transition guy until it really bottoms, then he’s gone. I almost feel sorry the NAR, I mean what can they say publicly, “Yep this thing is getting ready to tank, Duck!” It’s like they have no choice but to be “Bagdad Bob”.

You know, I wonder why the hell the media keeps interviewing people that are essentially paid cheerleaders for the REI machine and portraying them as analysts.

I mean, they have disclaimers when they are doing a story that involves their parent company. Why not do the same for the RE shills?