when I said wages are stangnant I meant inflation adjusted. A 25% increase in income over a 5 year period just about breaks even with inflation and isn’t really any wage growth in real terms.
In addition the population of Orange County has increased only by 7% or so between 2000 and 2005 which has been the slowest increase in decades.
People are NOT moving into OC by the droves, that is completely an URBAN LEGEND!!!!
There are been a tremendous amount of overbuilding of late and right now, 60,000 new condos are slated to come to join the huge inventory pool within the next 2 years or so. Talk about a huge amount of surplus that nobody wants to buy.
My personal opinion is that unlike previous declines this time around there is going to be a very sharp initial decline in prices, probably 20% over the next 2 years, as the people that bought more than they could handle will be forced to foreclose after which we will have a slow protracted decline which may last another 5 years. We’re probably looking at a 7yr or longer downcycle.
List prices are already being cut on many properties by 10% or more over comps that sold in the summer 😉 That’s your 10% decline right there and it’s only been a few months now.
