Here are my observations from the properties I have looked at in OC and San Diego. The activity level has picked up some anecdotally. My Zip realty searches are returning alot of new listings each day up here that fit my criteria, not too many that fit it down in San Diego. This is activity, but not bullish activity.
There are still ridiculous asking prices on most of the homes I have seen, and I do not believe there is any chance of the majority of them selling for these prices. There have been alot of people walking through some of the homes that I have viewed, unlike 6 months ago when it was dead. I am working with SD Realtor on one place specifically and may wind up buying it, but my offer was well below the asking price, so it may not get any play.
I do think that prices will continue downward, although at a slow rate. I expect any property that I buy to devalue by itleast 10% or more over the next few years. I have never believed that buying a home is an investment. Unless you pay cash, the amount you wind up paying even on an after tax basis, is a multiple of the original price by a large enough amount, that you have to have a run like we have had, just to get ahead at all on the outlay.
However, due to my unique need for equestrian, etc.. I do have a somewhat limited offering of available stuff, and most of it is crap. Things have softened enough for me to start seriously trying to find something. If it initially drops 200k or so in the first few years, it does not matter to me. My plan will be to use a precipitous drop to buy a second home on the sand somewhere. It could very well be awhile before I actually buy because I am not going to chase anything, but if I find what I want I will try to make the best deal I can on it and move ahead. If I do not, I will stay on the sidelines. I do think by the end of the year this, we will be looking at a bad year in Southern California Real Estate. However, I think the chances of a 50% decline off the top are zero, I am in the 20% – 25% camp, with 10% already in the books.
BTW – a dead cat bounce is a term that is being used alot by people scouring the net. A dead cat bounce is a term from the trading world for a weak upward bounce on “declining volume.” I do not see how RE prices could rise on declining volume, so I do not think this can happen in RE. The median could do it due to how it is calculated, but a true broad market rise cannot happen, on declining sales volume in the housing market( just my opinion ).
