Cashman, congratulations on having the good sense to sell when you did. You may not see prices dropping in your old neighborhood yet but you probably don’t see nearly as many sales either. I sold in the spring of 2005 and left CA. I’ve been convinced since around 2001-2002 that the housing market would collapse and I’ve always thought that it would take 4-5 years for it to spiral down to the bottom from the very top. Condos are always the first to drop……..then the SFR’s in the outlying areas like Temecula, Riverside, etc. I’m convinced that it will work it’s way to the more desirable areas. If you follow the other housing blogs in CA and in other cities, you will see that the burners are starting to warm up. There is plenty of info in the area-specific blogs that communities like Pacific Palisades and Santa Monica are also starting to build inventory, see significant price drops and feel the heat. IMHO, you have done exactly the right thing if you’ve going to live in CA for the next two to four years because I think it’s going to take that long for everything to shake out. My prediction is that mid 2011 to mid 2012 will likely be the bottom which when reached, will sit for quite a while before any appreciable ramp-up is seen again. Countrywide presently has over 12,500 REO’s (3000 in CA) at the present time and they are only one of many lenders who are sitting on foreclosed inventory. Sooner than later, these lenders will need to convert these REO’s to cash and start slashing prices. If you can avoid it, you do not want to be a property owner in a bubble market like CA when this happens. There are also over 5.1 million homes for sale nationwide.
Mo…………Total…Exist. homes…months to sell….New for sale
Aug 07…5.11 million….4.58 million……..10.0 mo………529,000
Aug 06..4.49 million…..3.92 million……….7.5 mo………568,000
Aug 05..3.34 million…..2.86 million……….4.7 mo………479,000
Aug 04..2.88 million…..2.48 million……….4.6 mo………404,000
Look at the growth in inventory of homes for sale in the USA since Aug of 2004. We are headed into a bad recession and very possibly, a depression. You do not want to be a knife-catcher and you ARE doing the right thing at the present time.
