How low will it go? Quick survey

[SD Realtor]

I believe the bottom to be in the 2010-2011 timeframe and I think the damage will vary by housing type and location.

Perry I am not declaring immunity for any given zip code. I am just saying the damage will vary. I base this statement on the following:

1 – demand for that particular zip code or map code

2 – quality of the buyer. I think different areas attract different buyers with respect to demograhics, financial assets and employment types.

3 – distress in that area. I do not believe the foreclosure rate will be the same in every area. I think it will vary and in some cases that variance will be substantial.

4 – equity/mindset of the sellers. I believe that the profiles of sellers of different regions will alter each one. Sellers with high equity stakes AND emotional attachments will more likely leg it out and pass the home on to the kids, rent it out, or die in it.

Perry, don’t get me wrong. Again I am not declaring immunity for anyone however I do sincerely believe there will be different rates of decline and different bottoms. Areas that had high speculation ratios, risky financing vehicles, or homeowners that stretched and are now realizing it is not happening will indeed get hit harder then peer areas that do not. It doesn’t mean there will not be foreclosures in Del Mar, or La Jolla or RSF but I don’t believe there will be enough to cause major distress in these areas when compared to say downtown or Eastlake. Could these premium places see 20-30% hits? Perhaps they could indeed. Will those hits match counterparts in outlying areas or heavier run up areas or areas with widespread foreclosures? In my opinion no.

SD Realtor

[PerryChase]

Yes, formersandiegan, it could happen again. I understand what you mean now.

Some people here (not you) seem to think that Del Sur, 4S, Carlsbad and Carmel Valley will hold up better because they are new and “nice.” I think that the new tract homes areas will be hit hardest regardless of income because they are comprised mostly of buyers with little equity.

sdnativeson, I observed the same thing you did in the 1990s. You might be right this time about the middle class neighborhoods. In the 1990s the speculation was on the higher end with S&L loans. This time, the middle class speculated just as much or more.

[PerryChase]

Yes, formersandiegan, it could happen again. I understand what you mean now.

Some people here (not you) seem to think that Del Sur, 4S, Carlsbad and Carmel Valley will hold up better because they are new and “nice.” I think that the new tract homes areas will be hit hardest regardless of income because they are comprised mostly of buyers with little equity.

sdnativeson, I observed the same thing you did in the 1990s. You might be right this time about the middle class neighborhoods. In the 1990s the speculation was on the higher end with S&L loans. This time, the middle class speculated just as much or more.

[PerryChase]

Yes, formersandiegan, it could happen again. I understand what you mean now.

Some people here (not you) seem to think that Del Sur, 4S, Carlsbad and Carmel Valley will hold up better because they are new and “nice.” I think that the new tract homes areas will be hit hardest regardless of income because they are comprised mostly of buyers with little equity.

sdnativeson, I observed the same thing you did in the 1990s. You might be right this time about the middle class neighborhoods. In the 1990s the speculation was on the higher end with S&L loans. This time, the middle class speculated just as much or more.

[NotCranky]

It will go down until Rustico buys and then it will go back up. That’s easy.

[NotCranky]

It will go down until Rustico buys and then it will go back up. That’s easy.

[NotCranky]

It will go down until Rustico buys and then it will go back up. That’s easy.

[stansd]

I think most of the feedback here reflects the bias of this board. I’m a big housing bear, but I just can’t see 50% declines. That would put the house I am in at 250K versus a peak value of 550K (currently worth 500K).

Lets talk fundamentals…Lot of focus around on the median income…There are a lot of DINK’s and wealthy individuals in this city. I don’t recall the percentages of owners or renters in the area, but lets say it’s 50% and median income is 50K…that would imply that the median income of a housing owner in SD is probably nearing 100K. I live in RB where 90% are owners and median income is near 100K(median excluding renters is probably 120K).

At 100K, you can easily support the mortgage on a 350K house. I don’t see the decline going beyond 30% from today, and I think 20% is more likely.

If it hits 50%, unemployment will be above 10%, and we’ll all have big issues to worry about….yes, that’s only ’02 or ’03 prices.

Stan

[stansd]

I think most of the feedback here reflects the bias of this board. I’m a big housing bear, but I just can’t see 50% declines. That would put the house I am in at 250K versus a peak value of 550K (currently worth 500K).

Lets talk fundamentals…Lot of focus around on the median income…There are a lot of DINK’s and wealthy individuals in this city. I don’t recall the percentages of owners or renters in the area, but lets say it’s 50% and median income is 50K…that would imply that the median income of a housing owner in SD is probably nearing 100K. I live in RB where 90% are owners and median income is near 100K(median excluding renters is probably 120K).

At 100K, you can easily support the mortgage on a 350K house. I don’t see the decline going beyond 30% from today, and I think 20% is more likely.

If it hits 50%, unemployment will be above 10%, and we’ll all have big issues to worry about….yes, that’s only ’02 or ’03 prices.

Stan

[stansd]

I think most of the feedback here reflects the bias of this board. I’m a big housing bear, but I just can’t see 50% declines. That would put the house I am in at 250K versus a peak value of 550K (currently worth 500K).

Lets talk fundamentals…Lot of focus around on the median income…There are a lot of DINK’s and wealthy individuals in this city. I don’t recall the percentages of owners or renters in the area, but lets say it’s 50% and median income is 50K…that would imply that the median income of a housing owner in SD is probably nearing 100K. I live in RB where 90% are owners and median income is near 100K(median excluding renters is probably 120K).

At 100K, you can easily support the mortgage on a 350K house. I don’t see the decline going beyond 30% from today, and I think 20% is more likely.

If it hits 50%, unemployment will be above 10%, and we’ll all have big issues to worry about….yes, that’s only ’02 or ’03 prices.

Stan

[(former)FormerSanDiegan]

Perry –

I agree with you 100% regarding the new tract home areas being more susceptible. There is no history in the early 1990’s downturn for some of these areas.

[(former)FormerSanDiegan]

Perry –

I agree with you 100% regarding the new tract home areas being more susceptible. There is no history in the early 1990’s downturn for some of these areas.

[(former)FormerSanDiegan]

Perry –

I agree with you 100% regarding the new tract home areas being more susceptible. There is no history in the early 1990’s downturn for some of these areas.

[SD Realtor]

I agree that the “new and nice” tract home settings are susceptible to bigger falls due to the fact that there was a high degree of aggressive financing in these homes. Also these places will get superwhacked if the employment picture changes dramatically.

SD Realtor

[SD Realtor]

I agree that the “new and nice” tract home settings are susceptible to bigger falls due to the fact that there was a high degree of aggressive financing in these homes. Also these places will get superwhacked if the employment picture changes dramatically.

SD Realtor

[Author]

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