The Worst Decline are Yet to Come

[powayseller]

If history is any guide, the worst is yet to come. Calculated Risk writes today about the last CA bubble in the 1990’s.

“The worst annual declines occurred in the 3rd, 4th and 5th years of the housing bust.”

Nominal price declines were as follows, starting with year 1
-2%, -3%, -8%, -15%, -20%, -20%, -20%

[waiting hawk]

Here is a good one for ya PS,

http://www.cbsnews.com/sections/i_video/main500251.shtml

My website tracking Temecula and South Riverside County

[rseiser]

Yes, and just to make sure everyone can see the year over year changes (rounded):
-2%, -1%, -6%, -7%, -6%, 0%, -1%
They don’t seem big but persistent. Certainly not small if one considers that they should be a few percent positive due to inflation. And even worse if one expects them to be a few percent above inflation.

[powayseller]

In the last downturn, unemployment peaked over a 3-year period. graph

It was 8% in SD, 10% in CA, and 12% in the Inland Empire. Since this time will be worse, would be expect 12% unemployment in SD?

[uncle_git]

Given we are 6% down from peak in less around 7 or 8 months I suspect this bust will be significantly larger / more brutal than history shows busts being.

If we continue to drop at this rate it’ll be 10% down in year one alone – and suicide mortgages have only started to adjust.

Previous corrections took 3 years to drop that much….

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