I personally dont think we will see much more decline in places like MM just due to foreclosures. As the relators point out, fundaments in MM and even some similar places such as clairmont, are about as “normal” as todays market place could support.
That isnt to say that there wont be more price reductions, only that they wont come in the same way as in the past. Fannie and freddie are in crisis mode and changing their buisness. interest rates and fees are going up, and buyers are being squeezed out by that. Fannie is ending ALtA loans. Wouldnt supprise me one bit if that took 20% of MM buyers out of the pool. AltA was great for the would be donald trumps, and is going the way of subprime if Fannie/Freddie wont buy them anymore. Less demand……..
The last leg to chop off will be the move up buyer. The person who can be an upper end buyer in MM, or a lower end buyer in CV/PQ if prices in those areas will fall. The bottom end of the buyer pool is dead, subprime isnt coming back. AltA is following, and the buyer pyramid starts looking like a diamond shaped as the two ends just cant get financing.
The “trade up” effect plus the further reduction in financing will be the last 15-20%. 350k will become 280k, but I dont know if well actually see 280k as a number. Maybe there are enough asian families and bubble sitters to drag it out so inflation eats the rest. I dont think so, but I am kinda biased. (Fall baby; fall) Just my idiot opnion.
