[quote=sdrealtor]Care to share where those other places you are hearing about are? I know Phoenix and Vegas have been crushed. I have a friend I just spoke to in NY and the suburbs who said prices are back down to 2002 levels in prime areas (demographically equal to NCC). I just checked the town I grew up in which is an upper middle class Philly suburb. The houses are selling at 2002 prices in my town which is demographically equal to NCC (actually my town has a higher median income and is more affluent than Carlsbad). Nice homes there in better school districts than we have here start around 300K which is about 1/2 what they do here. FLA has been crushed. The midwest has been crushed.
Where in the country are these places you are referring to?
Other than California where are homes not affordable.[/quote]
There are some pockets of Florida that have been affected more substantially by the downturn than others which now offer excellent opportunities to investors in high quality new developments, Peerless points out. In Orlando, buyers can pay $140 per square foot down from $250 in 2006 and in Sarasota prices that were $350 per square foot are now as low as $47.
While Chicago foreclosures continued to pull down home prices in areas like South Side and Cicero by a total of more than 60 percent since 2006, foreclosure activity pulled down prices only slightly in areas like Gold Coast and Upton, allowing prices to drop only by 11 to 15.3 percent.
There have been many negative stories about the current real estate market. It is important to note that there have been areas holding steady and not seeing much of a decline in value. Davis is one of these places, but other areas close to downtown Sacramento are also holding there own including most of Land Park, parts of East Sacramento, McKinley Park and Curtis park. These neighborhoods are well-established and close to downtown. Recently KCRA TV did a newstory on the housing market in the bubble.
Cumberland, as you might recall, had some of the nation’s biggest price increases through a good bit of the downturn. Whether the drop now is giveback, new foreclosures pulling down values or statistical skewing in a small market, I can’t say. Any thoughts, guys?
[This is what I’m seeing here in California (both in SD and LA). The lower end, already hit and now filled with first-timers and speculators, is strengthening while the higher end — which held up better thorughout most of the decline — is weakening. -CAR]
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This is an older chart from 2008 which shows how the different areas declined at very different rates in VA:
The problem is financing. Although government stimulus programs have spurred some homebuying activity in the lower-priced market, would-be buyers of more expensive homes are strapped for credit. In most markets, including Miami, Fannie Mae considers loans for homes above $420,000 or so to be “jumbo loans” that typically have higher interest rates. As sales of these homes are tight, home prices are hit — but prices are slower to budge.
“The high-end market is going down more than the overall market, but sellers in that market don’t necessarily see themselves as being different from other sellers,” says Miller. “So it’s causing the spread between the ask price and contract price to widen.”
[Again, mid to higher-end homes, even in Florida, are slower to fall. While they’ve fallen more than homes in CA, they’ve generally held up better than the lower-end areas…but it seems like that is about to change. -CAR]
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Hate to make you have to watch a video presentation, but see what this says, noting what’s happened to Scottsdale and zip 85234 (didn’t get the name of the last zip, sorry…one of the better/best areas in the Phoenix):
[From a Seattle RE blog comment — I’ve heard this from other people who live in the area, too. Higher-end homes have fallen very little, respectively.]:
Notice, they’re from the Eastside and Seattle areas; higher priced Pink Pony heaven locations. More wealthy sellers too IMO, IOWs they can afford to list a property for a year or two without going bankrupt….so refuse to sell sweetheart deals like the more blue collar locations.
It’s like the price vultures patiently waiting in the trees for the seller cattle to finally collapse, eventually the economic realities hit the rich fatter cattle too.
Although America’s housing downturn has rippled nationwide, its impact varies greatly by geography – right down to individual streets, developments, and ZIP Codes.
Also, if you read the housing blogs that are nationally-focused, you’ll read the same thing. As many of us expected, the downturn hit the lowest end first, and was moving into the mid/higher end (in all cities and states, in general), but the govt intervened mid-decline and pumped **trillions of dollars** in the credit/housing markets. People are free to believe whatever they want to believe, but I am 100% convinced that this intervention halted declines (temporarily?) in the mid-higher ends.
IMHO, the declines in these markets have already begun, and the much higher-priced homes seem to have lost about 20% or more in 2009 while the lower end gained. Looks like we’re about to see the “big squish-down.”
