flogging a dead horse here, but i think rent is really crucial above all other parameters. speaking from my peer – 30 something service professionals working in LA, household income 110k+ – if you can rent a decent 2-3bed place for under $2500, most people would stop considering a purchase. until that happens, there will be enough serious people considering real estate. i know a lot of people who didn’t buy in this market but will take the plunge very soon. it’s still a herd mentality in either direction. the moment they see their friends purchase they will assume the market has bottomed out.
i don’t think it’s the price as much as the idea of the price. “am i buying at a good time?”
the flippers and the starters are obviously going to get burnt. most of the blue collar segment was chased out by the bubble here. the people who bought these homes are likely to have more stable income and reasons to stay. until rents dive in those areas i don’t see a total bloodbath (don’t kill me i’m just assuming from first hand experience and can be wrong)…
