Here in San Diego, and parts of L.A., the natural peak was in 2001 in many places. You can see the sales rates and price increases slowing down in late 2000/early 2001, and many people in the RE field (back when they were fairly sane) were calling the top of the housing cycle.
I knew plenty of people who were getting neg-am/no-doc and other toxic loans before 2003, and buyers had been in a frenzy since the late 90s. An anecdote: our favorite waitress at a local, family-style restaurant could hardly contain her enthusiasm when she told us about how she and her *boyfriend* (who also worked at the restaurant) were buying a $400K house. They had no downpayment, no other income, and they were both in their very young 20s. This was around 2001/2002, IIRC.
We were never allowed to experience the recession that was supposed to happen in 2000/2001. We just dipped a little, then it was off to the races when Greenspan started juicing the housing market. Now, we will have to experience the pain from the 2001 recession in full, PLUS suffer the effects as all the money that was created in 2001-2007 gets sucked back out of the system. Greenspan really f’ed us.
