I think the point of the article isn’t that the town will now expand and begin building, just that buyers are returning. It isn’t a revelation, drop the prices 50% to pre-bubble pricing and guess what? People will buy houses. Three demographics have caused the latest buying frenzy, those who were already here and were waiting it out, pre-retirees who wanted to trade down but didn’t want to go to another state because of family/grandkids and people who were frustrated waiting for S.D. and O.C. to get realistic and have jobs that don’t force them to commute daily or during rush hour. Buyers exist in every market and if you dangle sub 6% interest rates and 2001 prices in their face, they will buy. This valley fell on it’s face first, prices crashed first and recovery seems to have started first. They aren’t building anything that wasn’t aready started, most builders have slowed to a crawl or closed, the sales are just the repos and shorts.
There isn’t a housing crisis in So Cal, there is a pricing crisis. If you lower prices, houses sell, it’s just that simple.
I need to come up with a name for the post crash buyers, something like “price recasters” or “comp killers.” On my street and my cross street (who share a mailbox cluster) half of us bought repos and shorts post mid 2008 and there is an undeniable tension between the comp killers and the f%$#*% buyers who owe double what we paid. Two of my neighbors have not spoken to me since they found out what I paid, I’ll just have to wait six months for them to be replaced by new people, it’s like the invasion of the body snatchers, you wake each day to see who has been replaced. My neighborhood is more pronounced than most since it was built during the bubble, so every original owner paid peak prices and it’s fall was severe and highly publicized (national media used my development as an example of the crisis hitting high end homes back at the beginning when the media ran it’s first stories).
What’s next for the boomtown, nothing much, it will be good for the valley as a whole because people will have small mortgages that they qualified for and made downpayments on with fixed rates, the last of the sub primers are packing their things, it never became the section 8 nightmare that some predicted and life goes on.
