ESM,
I’m not disagreeing with you. (I also saw that 123K wasn’t 17% of 550K, thus my confusion)
Having the median drop 20% doesn’t mean that a median house a year ago is the same property at a median value today.
I still don’t know why median is even mentioned.
20%+ declines have already occurred in some areas, and 50%-60% falls won’t surprise me. A real depression won’t surprise me at some stage either.
Great discussion, thanks.
In any case, the 90’s wasn’t as bad around here. People who did lose homes, lost them with down payments invested.
It was mostly due to job loss and soft economy.
There was no 100% financing. I think that 97% FHA was the closest that we got, but plenty of nice homes were $250K or less.
100% +/- financing is what is going to make this correction bigger and better than any fireworks show. My condolences to anyone who bought in 2005–06.
Late 80’s early 90’s, $100-$125K bought a basic 3/2 in many inland areas. I don’t remember that prices slid more than about 20% by late ’96 and the recovery started about then.
It wasn’t until after the dot com bubble and 9-11 that low interest rates and 100% financing fueled the flames that lasted about 5 years.
While prices moved up rapidly, rents were way behind.
A 150% rise in prices was met with about a 50% rise in rents.
It wasn’t making sense, but it kept right on going.
I’m in the mortgage biz in Murrieta, I know the market well.
It’s going to get beyond ugly.
