I think I like the pain train buzzword better than the butterfly effect. Catchy.
I see HSBCs name on a lot of the REO sales; it seems like they’re in competition with Duestche Bank to see which of them can unload more REOs. I know they weren’t the only lenders making bad loans so I’m a little surprised that they don’t already have more competition out in the market.
Anyways, Stonebridge is somewhat in the same boat as Bressi Ranch and La Costa Oaks and San Elijo Hills. These are new home subdivisions that predominantly sold between 2004-2006, there were a lot of flippers in the pre-construction phases of selling, and a large percentage of all buyers used ARMs to finance.
I reckon that in these areas it will be the new home developments that will crack first as a result of the outside competition, thereby cutting the older neghborhoods off at the knees. Seeing as how some of the Scripps locals don’t consider Stonebridge to be part of Scripps proper they’ll probably disregard what happens there. It’ll be awhile yet before these guys get to the point where they are forced to acknowledge that Scripps isn’t a protected haven from declines.
