AN, I agree with you. You are getting into a range now where prices make sense with local incomes. 90k/year couple (thats only 45k each) can call this 3X income. That makes a whole lot more sense than the 450k+ that something like this woulda been sold for in 2005.
Now I may need to be alittle clearer about my “bottom” call. I think MM Houses will fall into this range, as a whole. That includes some of the nicer houses, the ones not on major roads or without kitchens etc etc etc. That means prices will continue to fall some more in the near future.
If we see a spike in unemployment above the ~6.5-7% we see now, then yah it’ll go quite a bit lower. I am convinced the two things that could kill MM real estate are layoffs at Qcomm/pill hill LJ, or a drop in enrollment at UCSD. UCSD may never happen, it is such a good school. But layoffs seem to be a popular thing now. I read something ill post about how the fastest growing reason for defaults on homes is due to job loss, not resets/BS morgages anymore.
I also think there could be some spillover from demand destruction from a falling “fortress” areas like CV, RB, 4S etc etc. But that depends upon the amount the more expensive areas fall.
Regardless, I dont believe these are the lowest prices we will ever see, even if they are not unreasonable prices to current incomes.
