[pizzaman]

Bugs
I did a test last summer, I drove from south Temecula (79 South) to Mission Road in Fallbrook and the temperature dropped 12 degrees, roughly 1 degree for every minute I drove. About that time we started talking about maybe moving there. Interesting to note, it takes me the same time to get from Hwy 79 in Temecula to Mission Rd as it does to get to my house in west Murrieta. (13 minutes).

Allan / anyone have any comments pro/con about Peppertree Park or Shady Grove in Fallbrook.
KB Homes has dropped the size and price of homes in Shady Grove quite a bit in the last year.

[pizzaman]

Bugs
I did a test last summer, I drove from south Temecula (79 South) to Mission Road in Fallbrook and the temperature dropped 12 degrees, roughly 1 degree for every minute I drove. About that time we started talking about maybe moving there. Interesting to note, it takes me the same time to get from Hwy 79 in Temecula to Mission Rd as it does to get to my house in west Murrieta. (13 minutes).

Allan / anyone have any comments pro/con about Peppertree Park or Shady Grove in Fallbrook.
KB Homes has dropped the size and price of homes in Shady Grove quite a bit in the last year.

[pizzaman]

Bugs
I did a test last summer, I drove from south Temecula (79 South) to Mission Road in Fallbrook and the temperature dropped 12 degrees, roughly 1 degree for every minute I drove. About that time we started talking about maybe moving there. Interesting to note, it takes me the same time to get from Hwy 79 in Temecula to Mission Rd as it does to get to my house in west Murrieta. (13 minutes).

Allan / anyone have any comments pro/con about Peppertree Park or Shady Grove in Fallbrook.
KB Homes has dropped the size and price of homes in Shady Grove quite a bit in the last year.

[pizzaman]

Bugs
I did a test last summer, I drove from south Temecula (79 South) to Mission Road in Fallbrook and the temperature dropped 12 degrees, roughly 1 degree for every minute I drove. About that time we started talking about maybe moving there. Interesting to note, it takes me the same time to get from Hwy 79 in Temecula to Mission Rd as it does to get to my house in west Murrieta. (13 minutes).

Allan / anyone have any comments pro/con about Peppertree Park or Shady Grove in Fallbrook.
KB Homes has dropped the size and price of homes in Shady Grove quite a bit in the last year.

[pizzaman]

Bugs
I did a test last summer, I drove from south Temecula (79 South) to Mission Road in Fallbrook and the temperature dropped 12 degrees, roughly 1 degree for every minute I drove. About that time we started talking about maybe moving there. Interesting to note, it takes me the same time to get from Hwy 79 in Temecula to Mission Rd as it does to get to my house in west Murrieta. (13 minutes).

Allan / anyone have any comments pro/con about Peppertree Park or Shady Grove in Fallbrook.
KB Homes has dropped the size and price of homes in Shady Grove quite a bit in the last year.

[pizzaman]

Bunny

I would agree with both TG and Paramount that another 10-20% drop is likely in 2008. The rate of decline is accelerating at this point. What I would like to add is a warning not to be too excited when you see large price drops. Two or three hundred thousand dollar drops are becoming common place and don’t necessarily mean you would be getting the best deal. Heres a listing for a house that’s listed at 325,000 which is 345,000 off its purchase price in of 670,000 in 2006.
http://www.redfin.com/stingray/do/printable-listing?listing-id=1354595

About the house in Crowne Hill, I had to chuckle when you mentioned that the owner had some “wiggle room”. When the house is a short sale the bank would be making the decisions, chances are the owner doesn’t even have the banks OK for the 479,000.

One last thought, recently I’ve been seeing owners bouncing prices up and down to try and create the perception of value. Its important to review the listing history. If you don’t have access to the MLS you can still see it by getting a Zip Realty account. Here an example. There is a home in Temecula (37909 Pratt Rd) that recently was reduced from 1,199,500 to 788,900. Wow, a 400k drop must be a good deal right? Not so fast, heres the whole story

On Market: 262 days
Price Reduced: 05/01/07 — $989,000 to $969,000
Price Reduced: 05/04/07 — $969,000 to $949,000
Price Increased: 05/05/07 — $949,000 to $959,000
Price Reduced: 05/07/07 — $959,000 to $949,000
Price Reduced: 05/20/07 — $949,000 to $939,000
Price Reduced: 05/22/07 — $939,000 to $929,000
Price Reduced: 06/03/07 — $929,000 to $928,500
Price Reduced: 06/05/07 — $928,500 to $919,000
Price Reduced: 06/07/07 — $919,000 to $899,000
Price Increased: 06/09/07 — $899,000 to $919,000
Price Reduced: 06/12/07 — $919,000 to $909,000
Price Reduced: 06/14/07 — $909,000 to $899,000
Price Reduced: 06/19/07 — $899,000 to $898,900
Price Reduced: 06/21/07 — $898,900 to $885,000
Price Reduced: 06/24/07 — $885,000 to $884,900
Price Reduced: 06/25/07 — $884,900 to $878,900
Price Reduced: 06/28/07 — $878,900 to $868,900
Price Increased: 07/07/07 — $868,900 to $878,900
Price Reduced: 07/10/07 — $878,900 to $877,900
Price Reduced: 07/11/07 — $877,900 to $864,900
Price Reduced: 07/12/07 — $864,900 to $858,900
Price Reduced: 07/23/07 — $858,900 to $848,900
Price Reduced: 08/01/07 — $848,900 to $844,900
Price Increased: 08/02/07 — $844,900 to $854,900
Price Reduced: 08/07/07 — $854,900 to $839,000
Price Reduced: 08/09/07 — $839,000 to $838,900
Price Reduced: 08/13/07 — $838,900 to $828,900
Price Increased: 08/14/07 — $828,900 to $832,900
Price Reduced: 08/16/07 — $832,900 to $829,000
Price Reduced: 08/16/07 — $829,000 to $824,900
Price Reduced: 08/21/07 — $824,900 to $819,900
Price Reduced: 08/29/07 — $819,900 to $798,900
Price Reduced: 09/05/07 — $798,900 to $795,900
Price Reduced: 09/07/07 — $795,900 to $787,900
Price Increased: 09/10/07 — $787,900 to $829,000
Price Reduced: 10/01/07 — $829,000 to $799,000
Price Increased: 10/05/07 — $799,000 to $849,000
Price Reduced: 10/09/07 — $849,000 to $819,000
Price Reduced: 10/15/07 — $819,000 to $818,900
Price Increased: 10/16/07 — $818,900 to $848,900
Price Reduced: 10/18/07 — $848,900 to $769,000
Price Increased: 10/23/07 — $769,000 to $818,900
Price Reduced: 11/09/07 — $818,900 to $784,900
Price Increased: 11/28/07 — $784,900 to $1,199,500
Price Reduced: 12/05/07 — $1,199,500 to $788,900
Price Reduced: 12/26/07 — $788,900 to $787,900

[pizzaman]

Bunny

I would agree with both TG and Paramount that another 10-20% drop is likely in 2008. The rate of decline is accelerating at this point. What I would like to add is a warning not to be too excited when you see large price drops. Two or three hundred thousand dollar drops are becoming common place and don’t necessarily mean you would be getting the best deal. Heres a listing for a house that’s listed at 325,000 which is 345,000 off its purchase price in of 670,000 in 2006.
http://www.redfin.com/stingray/do/printable-listing?listing-id=1354595

About the house in Crowne Hill, I had to chuckle when you mentioned that the owner had some “wiggle room”. When the house is a short sale the bank would be making the decisions, chances are the owner doesn’t even have the banks OK for the 479,000.

One last thought, recently I’ve been seeing owners bouncing prices up and down to try and create the perception of value. Its important to review the listing history. If you don’t have access to the MLS you can still see it by getting a Zip Realty account. Here an example. There is a home in Temecula (37909 Pratt Rd) that recently was reduced from 1,199,500 to 788,900. Wow, a 400k drop must be a good deal right? Not so fast, heres the whole story

On Market: 262 days
Price Reduced: 05/01/07 — $989,000 to $969,000
Price Reduced: 05/04/07 — $969,000 to $949,000
Price Increased: 05/05/07 — $949,000 to $959,000
Price Reduced: 05/07/07 — $959,000 to $949,000
Price Reduced: 05/20/07 — $949,000 to $939,000
Price Reduced: 05/22/07 — $939,000 to $929,000
Price Reduced: 06/03/07 — $929,000 to $928,500
Price Reduced: 06/05/07 — $928,500 to $919,000
Price Reduced: 06/07/07 — $919,000 to $899,000
Price Increased: 06/09/07 — $899,000 to $919,000
Price Reduced: 06/12/07 — $919,000 to $909,000
Price Reduced: 06/14/07 — $909,000 to $899,000
Price Reduced: 06/19/07 — $899,000 to $898,900
Price Reduced: 06/21/07 — $898,900 to $885,000
Price Reduced: 06/24/07 — $885,000 to $884,900
Price Reduced: 06/25/07 — $884,900 to $878,900
Price Reduced: 06/28/07 — $878,900 to $868,900
Price Increased: 07/07/07 — $868,900 to $878,900
Price Reduced: 07/10/07 — $878,900 to $877,900
Price Reduced: 07/11/07 — $877,900 to $864,900
Price Reduced: 07/12/07 — $864,900 to $858,900
Price Reduced: 07/23/07 — $858,900 to $848,900
Price Reduced: 08/01/07 — $848,900 to $844,900
Price Increased: 08/02/07 — $844,900 to $854,900
Price Reduced: 08/07/07 — $854,900 to $839,000
Price Reduced: 08/09/07 — $839,000 to $838,900
Price Reduced: 08/13/07 — $838,900 to $828,900
Price Increased: 08/14/07 — $828,900 to $832,900
Price Reduced: 08/16/07 — $832,900 to $829,000
Price Reduced: 08/16/07 — $829,000 to $824,900
Price Reduced: 08/21/07 — $824,900 to $819,900
Price Reduced: 08/29/07 — $819,900 to $798,900
Price Reduced: 09/05/07 — $798,900 to $795,900
Price Reduced: 09/07/07 — $795,900 to $787,900
Price Increased: 09/10/07 — $787,900 to $829,000
Price Reduced: 10/01/07 — $829,000 to $799,000
Price Increased: 10/05/07 — $799,000 to $849,000
Price Reduced: 10/09/07 — $849,000 to $819,000
Price Reduced: 10/15/07 — $819,000 to $818,900
Price Increased: 10/16/07 — $818,900 to $848,900
Price Reduced: 10/18/07 — $848,900 to $769,000
Price Increased: 10/23/07 — $769,000 to $818,900
Price Reduced: 11/09/07 — $818,900 to $784,900
Price Increased: 11/28/07 — $784,900 to $1,199,500
Price Reduced: 12/05/07 — $1,199,500 to $788,900
Price Reduced: 12/26/07 — $788,900 to $787,900

[pizzaman]

Bunny

I would agree with both TG and Paramount that another 10-20% drop is likely in 2008. The rate of decline is accelerating at this point. What I would like to add is a warning not to be too excited when you see large price drops. Two or three hundred thousand dollar drops are becoming common place and don’t necessarily mean you would be getting the best deal. Heres a listing for a house that’s listed at 325,000 which is 345,000 off its purchase price in of 670,000 in 2006.
http://www.redfin.com/stingray/do/printable-listing?listing-id=1354595

About the house in Crowne Hill, I had to chuckle when you mentioned that the owner had some “wiggle room”. When the house is a short sale the bank would be making the decisions, chances are the owner doesn’t even have the banks OK for the 479,000.

One last thought, recently I’ve been seeing owners bouncing prices up and down to try and create the perception of value. Its important to review the listing history. If you don’t have access to the MLS you can still see it by getting a Zip Realty account. Here an example. There is a home in Temecula (37909 Pratt Rd) that recently was reduced from 1,199,500 to 788,900. Wow, a 400k drop must be a good deal right? Not so fast, heres the whole story

On Market: 262 days
Price Reduced: 05/01/07 — $989,000 to $969,000
Price Reduced: 05/04/07 — $969,000 to $949,000
Price Increased: 05/05/07 — $949,000 to $959,000
Price Reduced: 05/07/07 — $959,000 to $949,000
Price Reduced: 05/20/07 — $949,000 to $939,000
Price Reduced: 05/22/07 — $939,000 to $929,000
Price Reduced: 06/03/07 — $929,000 to $928,500
Price Reduced: 06/05/07 — $928,500 to $919,000
Price Reduced: 06/07/07 — $919,000 to $899,000
Price Increased: 06/09/07 — $899,000 to $919,000
Price Reduced: 06/12/07 — $919,000 to $909,000
Price Reduced: 06/14/07 — $909,000 to $899,000
Price Reduced: 06/19/07 — $899,000 to $898,900
Price Reduced: 06/21/07 — $898,900 to $885,000
Price Reduced: 06/24/07 — $885,000 to $884,900
Price Reduced: 06/25/07 — $884,900 to $878,900
Price Reduced: 06/28/07 — $878,900 to $868,900
Price Increased: 07/07/07 — $868,900 to $878,900
Price Reduced: 07/10/07 — $878,900 to $877,900
Price Reduced: 07/11/07 — $877,900 to $864,900
Price Reduced: 07/12/07 — $864,900 to $858,900
Price Reduced: 07/23/07 — $858,900 to $848,900
Price Reduced: 08/01/07 — $848,900 to $844,900
Price Increased: 08/02/07 — $844,900 to $854,900
Price Reduced: 08/07/07 — $854,900 to $839,000
Price Reduced: 08/09/07 — $839,000 to $838,900
Price Reduced: 08/13/07 — $838,900 to $828,900
Price Increased: 08/14/07 — $828,900 to $832,900
Price Reduced: 08/16/07 — $832,900 to $829,000
Price Reduced: 08/16/07 — $829,000 to $824,900
Price Reduced: 08/21/07 — $824,900 to $819,900
Price Reduced: 08/29/07 — $819,900 to $798,900
Price Reduced: 09/05/07 — $798,900 to $795,900
Price Reduced: 09/07/07 — $795,900 to $787,900
Price Increased: 09/10/07 — $787,900 to $829,000
Price Reduced: 10/01/07 — $829,000 to $799,000
Price Increased: 10/05/07 — $799,000 to $849,000
Price Reduced: 10/09/07 — $849,000 to $819,000
Price Reduced: 10/15/07 — $819,000 to $818,900
Price Increased: 10/16/07 — $818,900 to $848,900
Price Reduced: 10/18/07 — $848,900 to $769,000
Price Increased: 10/23/07 — $769,000 to $818,900
Price Reduced: 11/09/07 — $818,900 to $784,900
Price Increased: 11/28/07 — $784,900 to $1,199,500
Price Reduced: 12/05/07 — $1,199,500 to $788,900
Price Reduced: 12/26/07 — $788,900 to $787,900

[pizzaman]

Bunny

I would agree with both TG and Paramount that another 10-20% drop is likely in 2008. The rate of decline is accelerating at this point. What I would like to add is a warning not to be too excited when you see large price drops. Two or three hundred thousand dollar drops are becoming common place and don’t necessarily mean you would be getting the best deal. Heres a listing for a house that’s listed at 325,000 which is 345,000 off its purchase price in of 670,000 in 2006.
http://www.redfin.com/stingray/do/printable-listing?listing-id=1354595

About the house in Crowne Hill, I had to chuckle when you mentioned that the owner had some “wiggle room”. When the house is a short sale the bank would be making the decisions, chances are the owner doesn’t even have the banks OK for the 479,000.

One last thought, recently I’ve been seeing owners bouncing prices up and down to try and create the perception of value. Its important to review the listing history. If you don’t have access to the MLS you can still see it by getting a Zip Realty account. Here an example. There is a home in Temecula (37909 Pratt Rd) that recently was reduced from 1,199,500 to 788,900. Wow, a 400k drop must be a good deal right? Not so fast, heres the whole story

On Market: 262 days
Price Reduced: 05/01/07 — $989,000 to $969,000
Price Reduced: 05/04/07 — $969,000 to $949,000
Price Increased: 05/05/07 — $949,000 to $959,000
Price Reduced: 05/07/07 — $959,000 to $949,000
Price Reduced: 05/20/07 — $949,000 to $939,000
Price Reduced: 05/22/07 — $939,000 to $929,000
Price Reduced: 06/03/07 — $929,000 to $928,500
Price Reduced: 06/05/07 — $928,500 to $919,000
Price Reduced: 06/07/07 — $919,000 to $899,000
Price Increased: 06/09/07 — $899,000 to $919,000
Price Reduced: 06/12/07 — $919,000 to $909,000
Price Reduced: 06/14/07 — $909,000 to $899,000
Price Reduced: 06/19/07 — $899,000 to $898,900
Price Reduced: 06/21/07 — $898,900 to $885,000
Price Reduced: 06/24/07 — $885,000 to $884,900
Price Reduced: 06/25/07 — $884,900 to $878,900
Price Reduced: 06/28/07 — $878,900 to $868,900
Price Increased: 07/07/07 — $868,900 to $878,900
Price Reduced: 07/10/07 — $878,900 to $877,900
Price Reduced: 07/11/07 — $877,900 to $864,900
Price Reduced: 07/12/07 — $864,900 to $858,900
Price Reduced: 07/23/07 — $858,900 to $848,900
Price Reduced: 08/01/07 — $848,900 to $844,900
Price Increased: 08/02/07 — $844,900 to $854,900
Price Reduced: 08/07/07 — $854,900 to $839,000
Price Reduced: 08/09/07 — $839,000 to $838,900
Price Reduced: 08/13/07 — $838,900 to $828,900
Price Increased: 08/14/07 — $828,900 to $832,900
Price Reduced: 08/16/07 — $832,900 to $829,000
Price Reduced: 08/16/07 — $829,000 to $824,900
Price Reduced: 08/21/07 — $824,900 to $819,900
Price Reduced: 08/29/07 — $819,900 to $798,900
Price Reduced: 09/05/07 — $798,900 to $795,900
Price Reduced: 09/07/07 — $795,900 to $787,900
Price Increased: 09/10/07 — $787,900 to $829,000
Price Reduced: 10/01/07 — $829,000 to $799,000
Price Increased: 10/05/07 — $799,000 to $849,000
Price Reduced: 10/09/07 — $849,000 to $819,000
Price Reduced: 10/15/07 — $819,000 to $818,900
Price Increased: 10/16/07 — $818,900 to $848,900
Price Reduced: 10/18/07 — $848,900 to $769,000
Price Increased: 10/23/07 — $769,000 to $818,900
Price Reduced: 11/09/07 — $818,900 to $784,900
Price Increased: 11/28/07 — $784,900 to $1,199,500
Price Reduced: 12/05/07 — $1,199,500 to $788,900
Price Reduced: 12/26/07 — $788,900 to $787,900

[pizzaman]

Bunny

I would agree with both TG and Paramount that another 10-20% drop is likely in 2008. The rate of decline is accelerating at this point. What I would like to add is a warning not to be too excited when you see large price drops. Two or three hundred thousand dollar drops are becoming common place and don’t necessarily mean you would be getting the best deal. Heres a listing for a house that’s listed at 325,000 which is 345,000 off its purchase price in of 670,000 in 2006.
http://www.redfin.com/stingray/do/printable-listing?listing-id=1354595

About the house in Crowne Hill, I had to chuckle when you mentioned that the owner had some “wiggle room”. When the house is a short sale the bank would be making the decisions, chances are the owner doesn’t even have the banks OK for the 479,000.

One last thought, recently I’ve been seeing owners bouncing prices up and down to try and create the perception of value. Its important to review the listing history. If you don’t have access to the MLS you can still see it by getting a Zip Realty account. Here an example. There is a home in Temecula (37909 Pratt Rd) that recently was reduced from 1,199,500 to 788,900. Wow, a 400k drop must be a good deal right? Not so fast, heres the whole story

On Market: 262 days
Price Reduced: 05/01/07 — $989,000 to $969,000
Price Reduced: 05/04/07 — $969,000 to $949,000
Price Increased: 05/05/07 — $949,000 to $959,000
Price Reduced: 05/07/07 — $959,000 to $949,000
Price Reduced: 05/20/07 — $949,000 to $939,000
Price Reduced: 05/22/07 — $939,000 to $929,000
Price Reduced: 06/03/07 — $929,000 to $928,500
Price Reduced: 06/05/07 — $928,500 to $919,000
Price Reduced: 06/07/07 — $919,000 to $899,000
Price Increased: 06/09/07 — $899,000 to $919,000
Price Reduced: 06/12/07 — $919,000 to $909,000
Price Reduced: 06/14/07 — $909,000 to $899,000
Price Reduced: 06/19/07 — $899,000 to $898,900
Price Reduced: 06/21/07 — $898,900 to $885,000
Price Reduced: 06/24/07 — $885,000 to $884,900
Price Reduced: 06/25/07 — $884,900 to $878,900
Price Reduced: 06/28/07 — $878,900 to $868,900
Price Increased: 07/07/07 — $868,900 to $878,900
Price Reduced: 07/10/07 — $878,900 to $877,900
Price Reduced: 07/11/07 — $877,900 to $864,900
Price Reduced: 07/12/07 — $864,900 to $858,900
Price Reduced: 07/23/07 — $858,900 to $848,900
Price Reduced: 08/01/07 — $848,900 to $844,900
Price Increased: 08/02/07 — $844,900 to $854,900
Price Reduced: 08/07/07 — $854,900 to $839,000
Price Reduced: 08/09/07 — $839,000 to $838,900
Price Reduced: 08/13/07 — $838,900 to $828,900
Price Increased: 08/14/07 — $828,900 to $832,900
Price Reduced: 08/16/07 — $832,900 to $829,000
Price Reduced: 08/16/07 — $829,000 to $824,900
Price Reduced: 08/21/07 — $824,900 to $819,900
Price Reduced: 08/29/07 — $819,900 to $798,900
Price Reduced: 09/05/07 — $798,900 to $795,900
Price Reduced: 09/07/07 — $795,900 to $787,900
Price Increased: 09/10/07 — $787,900 to $829,000
Price Reduced: 10/01/07 — $829,000 to $799,000
Price Increased: 10/05/07 — $799,000 to $849,000
Price Reduced: 10/09/07 — $849,000 to $819,000
Price Reduced: 10/15/07 — $819,000 to $818,900
Price Increased: 10/16/07 — $818,900 to $848,900
Price Reduced: 10/18/07 — $848,900 to $769,000
Price Increased: 10/23/07 — $769,000 to $818,900
Price Reduced: 11/09/07 — $818,900 to $784,900
Price Increased: 11/28/07 — $784,900 to $1,199,500
Price Reduced: 12/05/07 — $1,199,500 to $788,900
Price Reduced: 12/26/07 — $788,900 to $787,900

[pizzaman]

One note of caution when making comparisons based purely on ppsf, the houses that were available in Murrieta and Temecula in the early part of the decade tended to be smaller than what was being constructed at the top of the market. Most of the low price psf leaders we are seeing today are homes that have very large sq footage that generally was not available in 2000-2001. 3000 sq ft was a very large house in 2001. By 2005 there were many 3500 and even 4000 sq ft houses being built in this area.

That said, as I mentioned in my earlier post, if we maintain the current rate of decline we should see 2001 prices in 2008 which would put 2500 sq. ft houses into the high 80’s and low 90’s ppsf.

Heres an example of whats going on in one Murrieta tract.
Standard Pacific built a tract that they sold in 2001 and 2002. There were 3 models with square footage between 2400 -3000. The ppsf was in the high 80’s and low 90’s. By late 2002 the resales in the tract were in the $100-110 ppsf range. By 2006 homes sold for as much as $200 psf (mortgage fraud). I owned a home in the tract that I sold earlier this year for $150 psf. The lowest repo price today in the tract today is $120 psf and not selling. If I throw out the fraud sales there is still a 20% drop in less than a year. If 2008 is as bad as we all expect it to be that should take us right down to the original selling prices of 2001.

[pizzaman]

One note of caution when making comparisons based purely on ppsf, the houses that were available in Murrieta and Temecula in the early part of the decade tended to be smaller than what was being constructed at the top of the market. Most of the low price psf leaders we are seeing today are homes that have very large sq footage that generally was not available in 2000-2001. 3000 sq ft was a very large house in 2001. By 2005 there were many 3500 and even 4000 sq ft houses being built in this area.

That said, as I mentioned in my earlier post, if we maintain the current rate of decline we should see 2001 prices in 2008 which would put 2500 sq. ft houses into the high 80’s and low 90’s ppsf.

Heres an example of whats going on in one Murrieta tract.
Standard Pacific built a tract that they sold in 2001 and 2002. There were 3 models with square footage between 2400 -3000. The ppsf was in the high 80’s and low 90’s. By late 2002 the resales in the tract were in the $100-110 ppsf range. By 2006 homes sold for as much as $200 psf (mortgage fraud). I owned a home in the tract that I sold earlier this year for $150 psf. The lowest repo price today in the tract today is $120 psf and not selling. If I throw out the fraud sales there is still a 20% drop in less than a year. If 2008 is as bad as we all expect it to be that should take us right down to the original selling prices of 2001.

[pizzaman]

One note of caution when making comparisons based purely on ppsf, the houses that were available in Murrieta and Temecula in the early part of the decade tended to be smaller than what was being constructed at the top of the market. Most of the low price psf leaders we are seeing today are homes that have very large sq footage that generally was not available in 2000-2001. 3000 sq ft was a very large house in 2001. By 2005 there were many 3500 and even 4000 sq ft houses being built in this area.

That said, as I mentioned in my earlier post, if we maintain the current rate of decline we should see 2001 prices in 2008 which would put 2500 sq. ft houses into the high 80’s and low 90’s ppsf.

Heres an example of whats going on in one Murrieta tract.
Standard Pacific built a tract that they sold in 2001 and 2002. There were 3 models with square footage between 2400 -3000. The ppsf was in the high 80’s and low 90’s. By late 2002 the resales in the tract were in the $100-110 ppsf range. By 2006 homes sold for as much as $200 psf (mortgage fraud). I owned a home in the tract that I sold earlier this year for $150 psf. The lowest repo price today in the tract today is $120 psf and not selling. If I throw out the fraud sales there is still a 20% drop in less than a year. If 2008 is as bad as we all expect it to be that should take us right down to the original selling prices of 2001.

[pizzaman]

One note of caution when making comparisons based purely on ppsf, the houses that were available in Murrieta and Temecula in the early part of the decade tended to be smaller than what was being constructed at the top of the market. Most of the low price psf leaders we are seeing today are homes that have very large sq footage that generally was not available in 2000-2001. 3000 sq ft was a very large house in 2001. By 2005 there were many 3500 and even 4000 sq ft houses being built in this area.

That said, as I mentioned in my earlier post, if we maintain the current rate of decline we should see 2001 prices in 2008 which would put 2500 sq. ft houses into the high 80’s and low 90’s ppsf.

Heres an example of whats going on in one Murrieta tract.
Standard Pacific built a tract that they sold in 2001 and 2002. There were 3 models with square footage between 2400 -3000. The ppsf was in the high 80’s and low 90’s. By late 2002 the resales in the tract were in the $100-110 ppsf range. By 2006 homes sold for as much as $200 psf (mortgage fraud). I owned a home in the tract that I sold earlier this year for $150 psf. The lowest repo price today in the tract today is $120 psf and not selling. If I throw out the fraud sales there is still a 20% drop in less than a year. If 2008 is as bad as we all expect it to be that should take us right down to the original selling prices of 2001.

[pizzaman]

One note of caution when making comparisons based purely on ppsf, the houses that were available in Murrieta and Temecula in the early part of the decade tended to be smaller than what was being constructed at the top of the market. Most of the low price psf leaders we are seeing today are homes that have very large sq footage that generally was not available in 2000-2001. 3000 sq ft was a very large house in 2001. By 2005 there were many 3500 and even 4000 sq ft houses being built in this area.

That said, as I mentioned in my earlier post, if we maintain the current rate of decline we should see 2001 prices in 2008 which would put 2500 sq. ft houses into the high 80’s and low 90’s ppsf.

Heres an example of whats going on in one Murrieta tract.
Standard Pacific built a tract that they sold in 2001 and 2002. There were 3 models with square footage between 2400 -3000. The ppsf was in the high 80’s and low 90’s. By late 2002 the resales in the tract were in the $100-110 ppsf range. By 2006 homes sold for as much as $200 psf (mortgage fraud). I owned a home in the tract that I sold earlier this year for $150 psf. The lowest repo price today in the tract today is $120 psf and not selling. If I throw out the fraud sales there is still a 20% drop in less than a year. If 2008 is as bad as we all expect it to be that should take us right down to the original selling prices of 2001.

[Author]

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