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  1. evolusd
    December 29, 2010 @ 12:30 PM

    Hooray!
    Hooray!

    • SD Transplant
      December 29, 2010 @ 1:36 PM

      and a few percentiles more to
      and a few percentiles more to come 🙂

      • SD Realtor
        December 29, 2010 @ 5:58 PM

        As long as the govt doesnt
        As long as the govt doesnt try anything stupid we should continue to drift down.

  2. sdduuuude
    December 30, 2010 @ 1:14 PM

    I love the graphs going way
    I love the graphs going way back in time. Just puts into perspective the recent price growth and how it relates to the boom and bust years. Makes it more apparent that we could be just bouncing along the bottom now, and for a while to come.

    • sdrealtor
      December 30, 2010 @ 1:39 PM

      Love the longer term graphs
      Love the longer term graphs also but what I find interesting is that they show the bulk of the froth is gone. If you would have shown this graph around here four years ago, I think we would all expect that much lower prices than we actually have in the mid and upper price ranges would be everywhere and they arent.

      • SD Realtor
        December 30, 2010 @ 3:32 PM

        You mean no 2ksf ocean view
        You mean no 2ksf ocean view home in a good school district for 400k?

        Darn!!

        Sarcasm off. We did have quite a bit of discussion in 06 and 07 about tsunamis, double digit unemployment and radical price drops though didn’t we? I wish for alot of people including myself the price drops would have been more substantial. The powers that be did a damn good job on price control. To bad the economy is still on life support though. Imagine if they would have let things run the proper course?

      • Jazzman
        December 30, 2010 @ 5:24 PM

        I watch that curve every
        I watch that curve every month
        Willing and praying it slips a notch
        Median, Shiller and foreclosures too
        Are all good news for me and you.

        Red lines, blue lines, yellow lines three
        All look set for a declining spree
        At last that credit that taxed us all
        Does no longer the government enthrall

        If you doubted prices would ever drop
        Now eat your words before they stop
        A home is a just house, and not much more
        So let’s try again, as a long time before.

      • CA renter
        December 30, 2010 @ 8:45 PM

        sdrealtor wrote:Love the
        [quote=sdrealtor]Love the longer term graphs also but what I find interesting is that they show the bulk of the froth is gone. If you would have shown this graph around here four years ago, I think we would all expect that much lower prices than we actually have in the mid and upper price ranges would be everywhere and they arent.[/quote]

        The bulk of the froth is gone if you think 2003 prices weren’t “frothy.”

        Some of us believe the natural peak of the RE cycle was hit in 2001. All the price increases that came after that was due to the credit bubble.

        Imagine what that graph would look like if the Fed/govt had stayed out of the market; we’d be pretty close to a bottom by now. Because of all the interventions, I don’t think we’ll see a bottom until 2013-2016.

      • sdrealtor
        December 30, 2010 @ 8:57 PM

        Even if you think the natural
        Even if you think the natural peak was 2001 or even 1999 the bulk of the froth is still gone. The big abnormal surge in that trend line has long been normalized. By the we hit 2002 levels on the graph and bounced off that. Even if you take 1999 and allow very modest inflation we are back on the trend line countywide.

      • CA renter
        December 31, 2010 @ 12:38 AM

        sdrealtor wrote:Even if you
        [quote=sdrealtor]Even if you think the natural peak was 2001 or even 1999 the bulk of the froth is still gone. The big abnormal surge in that trend line has long been normalized. By the we hit 2002 levels on the graph and bounced off that. Even if you take 1999 and allow very modest inflation we are back on the trend line countywide.[/quote]

        Ah, the “perpetual inflation” theory we are bred to believe in. Why should we allow for *any* inflation when working people (the types who usually buy family homes) have been losing ground for so many years? Their pay is down (in many cases), unemployment is up, and the costs of other basic necessities are up…that would mean housing costs should be flat to down from a peak in 2001.

      • Rich Toscano
        December 31, 2010 @ 7:57 AM

        CA renter wrote:
        Ah, the

        [quote=CA renter]
        Ah, the “perpetual inflation” theory we are bred to believe in. Why should we allow for *any* inflation when working people (the types who usually buy family homes) have been losing ground for so many years? Their pay is down (in many cases), unemployment is up, and the costs of other basic necessities are up…that would mean housing costs should be flat to down from a peak in 2001.[/quote]

        I hear this a lot but I just don’t see it in the data… per the Census bureau for instance, median household income rose 33% between 2000 and 2008. It’s probably dropped somewhat since then but not substantially. The per capita income figures show pretty much the identical numbers.

        I think you make a couple good counters. One, that these are aggregate numbers and that some have done better than others. But I would counter-counter that the homebuying crowd probably tends to be the one that does better, or at least not substantially worse than the average/median.

        Your second counter is that if incomes have dropped in real terms, that leaves less money available for house buying. I agree with that one in principal, but incomes have not (yet anyway!) dropped enough in real terms to really move the needle in that respect — not when you are dealing with a nominal gain that is probably not too shy of 30%.

        So in nominal terms — and that is what matters when it comes to pricing homes in nominal dollars — I just don’t see people as having lost ground over the past decade… the data I see (and I am open to any I may have missed) says that they have gained considerable ground. Such is the magic of monetary debasement…

      • Jazzman
        December 31, 2010 @ 9:45 AM

        If there have been big gains
        If there have been big gains in income, then why are so many more people in debt? Are they just spending more, and has credit got a lot to do with it. Disposable incomes might be a more useful measure of how much better, or worse off people are now, and if savings are any indication, then we are possibly worse off.

      • Rich Toscano
        December 31, 2010 @ 2:03 PM

        Jazzman —
        “f there have

        Jazzman —

        “f there have been big gains in income, then why are so many more people in debt? Are they just spending more…”

        Yes, or to be more specific, they WERE spending more, because debt is a function of accrued earning and spending in the past. (They continue to spend more than they earn, in aggregate, and may well continue to do so — but the point is that the debt results from spending that has already happened.)

        I think your argument about disposable income is valid, and is basically another way of stating CAR’s point about how much income is available to buy a house. This surely makes a difference, but not enough to offset the 30% or whatever income increase.

        To say that people are worse off in nominal terms (ie that they have fewer available dollars now than they did in 2001), even as nominal incomes have increased by nearly 1/3 over that time… this requires some serious data to back it up and nobody has brought any to the table yet.

        BTW I enjoy your poetry.

      • Jazzman
        December 31, 2010 @ 3:57 PM

        Rich, I’m not an economist so
        Rich, I’m not an economist so just thinking aloud here. When looking at median incomes wouldn’t you need to take into account the growing disparity in earnings in recent years, in which high flyers’ incomes have shot through the stratosphere?

      • Rich Toscano
        December 31, 2010 @ 4:07 PM

        That’s why I looked at the
        That’s why I looked at the median instead of the average… the median is the middle value so huge outliers don’t skew it upward. But it turns out the median and average incomes are not all that far off, so it’s really not the case that a few super-rich people are making so much as to pull the average up noticably.

      • CA renter
        December 31, 2010 @ 5:15 PM

        Rich Toscano wrote:That’s why
        [quote=Rich Toscano]That’s why I looked at the median instead of the average… the median is the middle value so huge outliers don’t skew it upward. But it turns out the median and average incomes are not all that far off, so it’s really not the case that a few super-rich people are making so much as to pull the average up noticably.[/quote]

        Not avoiding this topic. Don’t have time today, but will get on the proof (or lack thereof) later. 🙂

        Happy New Year!

      • Rich Toscano
        December 31, 2010 @ 6:40 PM

        Happy new year to you too
        Happy new year to you too CAR! (And everyone else too!)

      • CA renter
        January 5, 2011 @ 7:42 PM

        Rich Toscano wrote:CA renter
        [quote=Rich Toscano][quote=CA renter]
        Ah, the “perpetual inflation” theory we are bred to believe in. Why should we allow for *any* inflation when working people (the types who usually buy family homes) have been losing ground for so many years? Their pay is down (in many cases), unemployment is up, and the costs of other basic necessities are up…that would mean housing costs should be flat to down from a peak in 2001.[/quote]

        I hear this a lot but I just don’t see it in the data… per the Census bureau for instance, median household income rose 33% between 2000 and 2008. It’s probably dropped somewhat since then but not substantially. The per capita income figures show pretty much the identical numbers.

        I think you make a couple good counters. One, that these are aggregate numbers and that some have done better than others. But I would counter-counter that the homebuying crowd probably tends to be the one that does better, or at least not substantially worse than the average/median.

        Your second counter is that if incomes have dropped in real terms, that leaves less money available for house buying. I agree with that one in principal, but incomes have not (yet anyway!) dropped enough in real terms to really move the needle in that respect — not when you are dealing with a nominal gain that is probably not too shy of 30%.

        So in nominal terms — and that is what matters when it comes to pricing homes in nominal dollars — I just don’t see people as having lost ground over the past decade… the data I see (and I am open to any I may have missed) says that they have gained considerable ground. Such is the magic of monetary debasement…[/quote]

        While last year’s overall income gains are good news, the longer-range view is quite different. The Census figures show that the economic cycle that began in 2000 and ended late last year was one of the weakest on record for working families, despite strong overall economic growth during the same period (see Table 1 and Figure 1).

        Looking at the full cycle across economic peak years—a more useful measure in evaluating economic performance—reveals that household income was no higher in 2007 than in 2000, the previous peak. Given rising joblessness and declining real wages, next year’s numbers will certainly be worse.

        Comparisons between 2000 and 2007 reveal:

        Median income fell further for working-age households than for all households because job and wage growth was particularly weak in the 2000s relative to past cycles (see Figure 2).

        http://www.epi.org/publications/entry/webfeatures_econindicators_income_20080826/
        —————

        The fact that average incomes remained lower in 2005 than five years earlier helps explain why so many Americans report feeling economic stress despite overall growth in the economy. Many Americans are also paying a larger share of their health care costs and have had their retirement benefits reduced, adding to their out-of-pocket costs.

        http://www.nytimes.com/2007/08/21/business/21tax.html?_r=1
        ————–

        The downturn that some have dubbed the “Great Recession” has trimmed the typical household’s income significantly, new Census data show, following years of stagnant wage growth that made the past decade the worst for American families in at least half a century.

        Conor Dougherty and Mark Whitehouse discuss two sides of America’s strained economy: a poverty rate that has climbed to its highest level since 1994 and the increasing income volatility among the rich.
        The bureau’s annual snapshot of American living standards also found that the fraction of Americans living in poverty rose sharply to 14.3% from 13.2% in 2008—the highest since 1994. Some 43.6 million Americans were living below the official poverty threshold, but the measure doesn’t fully capture the panoply of government antipoverty measures.

        The inflation-adjusted income of the median household—smack in the middle of the populace—fell 4.8% between 2000 and 2009, even worse than the 1970s, when median income rose 1.9% despite high unemployment and inflation. Between 2007 and 2009, incomes fell 4.2%.

        http://online.wsj.com/article/SB10001424052748703440604575495670714069694.html?mod=WSJ_hpp_MIDDLENexttoWhatsNewsThird

        —————-

        Now I need to look more closely at their data sources to see why it differs from Rich’s (unless someone knows right off the top of his/her heads?).

      • Rich Toscano
        January 5, 2011 @ 7:54 PM

        CA renter wrote:
        Now I need

        [quote=CA renter]
        Now I need to look more closely at their data sources to see why it differs from Rich’s (unless someone knows right off the top of his/her heads?).[/quote]

        These are all inflation-adjusted numbers… you have to look at nominal income to determine what nominal home prices should be. (I find it completely plausible that inflation adjusted incomes have dropped this decade — but also mostly irrelevant to the topic of nominal home prices).

        Also fwiw these are nationwide numbers; the data I cited concerns San Diego.

      • an
        January 5, 2011 @ 8:05 PM

        Here are some Data from
        Here are some Data from SANDAG.
        Current: http://profilewarehouse.sandag.org/profiles/est/city14est.pdf
        2000 Census: http://profilewarehouse.sandag.org/profiles/cen00/city14cen00.pdf

        As you can see, in 2000, SD’s median house hold income was $45,825 and adjusted for inflation, it is $50,025 as of Jan 1st, 2009. Not adjusted for inflation, it’s $70,149. So, in term of nominal income, salary of the median house hold in San Diego went up 53% over 9 years. It will be interesting to see what the 2010 Census show but here is there estimate between now and 2050: http://profilewarehouse.sandag.org/profiles/fcst/city14fcst.pdf.

        Also, when you look at the group that actually can afford to buy in NCC and other higher end areas (HHI of >$150k), in 1999, there were a total of 27,036 HH, while in 2009, there were 34444 HH. So, that’s 7408 more house hold in SD that make >$150K in 2009 than 1999. When you look at >$100k, in 1999, there were 70495 HH, while in 2009, there were 86308 HH. That’s 15813 more HH in 2009 making >$100k than 1999.

      • CA renter
        January 5, 2011 @ 8:09 PM

        AN wrote:Here are some Data
        [quote=AN]Here are some Data from SANDAG.
        Current: http://profilewarehouse.sandag.org/profiles/est/city14est.pdf
        2000 Census: http://profilewarehouse.sandag.org/profiles/cen00/city14cen00.pdf

        As you can see, in 2000, SD’s median house hold income was $45,825 and adjusted for inflation, it is $50,025 as of Jan 1st, 2009. Not adjusted for inflation, it’s $70,149. So, in term of nominal income, salary of the median house hold in San Diego went up 53% over 9 years. It will be interesting to see what the 2010 Census show but here is there estimate between now and 2050: http://profilewarehouse.sandag.org/profiles/fcst/city14fcst.pdf.

        Also, when you look at the group that actually can afford to buy in NCC and other higher end areas (HHI of >$150k), in 1999, there were a total of 27,036 HH, while in 2009, there were 34444 HH. So, that’s 7408 more house hold in SD that make >$150K in 2009 than 1999. When you look at >$100k, in 1999, there were 70495 HH, while in 2009, there were 86308 HH. That’s 15813 more HH in 2009 making >$100k than 1999.[/quote]

        Good info, AN.

        Agree that if we’re talking about San Diego housing — and that’s what this site is about, after all — then we should look at SD numbers. Yes, if incomes are up by that number, then it certainly would indicate that home prices should be higher than they were in 2000.

        Thanks, Rich and AN!

      • sdrealtor
        January 5, 2011 @ 11:04 PM

        AN wrote:Here are some Data
        [quote=AN]Here are some Data from SANDAG.
        Current: http://profilewarehouse.sandag.org/profiles/est/city14est.pdf
        2000 Census: http://profilewarehouse.sandag.org/profiles/cen00/city14cen00.pdf

        As you can see, in 2000, SD’s median house hold income was $45,825 and adjusted for inflation, it is $50,025 as of Jan 1st, 2009. Not adjusted for inflation, it’s $70,149. So, in term of nominal income, salary of the median house hold in San Diego went up 53% over 9 years. It will be interesting to see what the 2010 Census show but here is there estimate between now and 2050: http://profilewarehouse.sandag.org/profiles/fcst/city14fcst.pdf.

        Also, when you look at the group that actually can afford to buy in NCC and other higher end areas (HHI of >$150k), in 1999, there were a total of 27,036 HH, while in 2009, there were 34444 HH. So, that’s 7408 more house hold in SD that make >$150K in 2009 than 1999. When you look at >$100k, in 1999, there were 70495 HH, while in 2009, there were 86308 HH. That’s 15813 more HH in 2009 making >$100k than 1999.[/quote]

        Wow!!! We hired 15813 new firefighters last decade?

      • CA renter
        January 6, 2011 @ 1:51 AM

        delete…keeping my mouth
        delete…keeping my mouth shut. 😉

      • sdrealtor
        January 6, 2011 @ 7:38 AM

        Just poking the bear;)
        Just poking the bear;)

      • CA renter
        January 6, 2011 @ 4:28 PM

        sdrealtor wrote:Just poking
        [quote=sdrealtor]Just poking the bear;)[/quote]

        Saw the juicy bait, circled it a few times, took a nibble, saw the hook, and backed off. 😉

        Just FYI, but those are not simple expansion numbers. Many/most of those new hires were replacing retired personel or people who left for other departments or careers.

      • an
        January 6, 2011 @ 8:49 AM

        Here’s another perspective at
        Here’s another perspective at this data. If a HH make the median of $45825/yr in 2000, their after tax income is $38694/yr or $3224.5/month. If a HH make the median of $70,149/yr in 2009, their after tax income is $60237/yr or 5019.75/month. So, their after income has increased by 55.67%. Also, such family most likely will only have enough for 20% down to buy a house. In 2000, mortgage rate range between 7.13% and 8.64%. So, lets take the 7.13% and 30% DTI (after tax income) number, the median house hold in 2000 can afford roughly $140k loan. In 2009, interest rate got as low as 4.71%, with 30% DTI (after tax income), the median house hold in 2009 can afford roughly $290k loan. So, a median house hold can now afford a little over 100% more loan and still maintain a 30% DTI when taking out a 30 yr. fixed rate.

      • Scarlett
        January 6, 2011 @ 10:36 AM

        AN wrote:Here’s another
        [quote=AN]Here’s another perspective at this data. If a HH make the median of $45825/yr in 2000, their after tax income is $38694/yr or $3224.5/month. If a HH make the median of $70,149/yr in 2009, their after tax income is $60237/yr or 5019.75/month. So, their after income has increased by 55.67%. Also, such family most likely will only have enough for 20% down to buy a house. In 2000, mortgage rate range between 7.13% and 8.64%. So, lets take the 7.13% and 30% DTI (after tax income) number, the median house hold in 2000 can afford roughly $140k loan. In 2009, interest rate got as low as 4.71%, with 30% DTI (after tax income), the median house hold in 2009 can afford roughly $290k loan. So, a median house hold can now afford a little over 100% more loan and still maintain a 30% DTI when taking out a 30 yr. fixed rate.[/quote]
        Assuming 20% down (which is a big assumption for the median family) and 300K loan…then the median home price should be ~375K.

        I don’t have an exact figure on hand, and I guess it depends what one includes in calculating the median price, but yes, we are very close to where the median household income can buy the median house in SD with 20% down and 30% DTI (not sure if it should be pre- or post-tax). But yes, it’s a good time to buy! Just kidding. Somehow, it still doesn’t feel right to me.

      • an
        January 6, 2011 @ 11:26 AM

        Scarlett, my point isn’t so
        Scarlett, my point isn’t so much about the 20% down but that for these people, interest rate plays a huge roll since they don’t have cash to buy the house out right. The less they put down, the more interest rate makes a difference. I used 30% DTI with after tax money to be conservative. If I use pre-tax money, then the loan size can be even bigger.

      • evolusd
        December 31, 2010 @ 7:48 AM

        I’m with CAR – due to the
        I’m with CAR – due to the crazy supply and demand dynamics going on, being back to the ‘trend line’ would be a best-case.

        My whole rationale for not buying right now is I firmly believe that there are MANY homes in the ‘shadow’ category and current listed supply is artificially very low. I hear stories every day about people, rich and poor, who haven’t paid thier mortgage in months. That is completely unsustainable for the banks and these properties will eventually go to market either as listings or rentals. 20% of people with mortgages are underwater! To me, that is an insane statistic that I bet may be even higher in San Diego, one of the more bubbly markets.

        Sure there’s money on the sidelines (my little savings, for example), but I just don’t see price increases anytime soon while we work through the listed and shadow inventory. Based on my income, the premium to purchase net of tax savings doesn’t pencil out without some appreciation.

        Of course, my wife would remind me that there’s more to owning a home than building wealth! 🙂

      • sdrealtor
        December 31, 2010 @ 10:10 AM

        FYI, recent loan servicing
        FYI, recent loan servicing data released last week show 90 day deliquencies are declining. I beleive the decline was nearly 10% year over year. Still lots of garbage to work through the system but as long new deliquencies continue to decline they will ge tthrough them all in a few years.

      • ocrenter
        January 1, 2011 @ 9:18 AM

        sdrealtor wrote:Love the
        [quote=sdrealtor]Love the longer term graphs also but what I find interesting is that they show the bulk of the froth is gone. If you would have shown this graph around here four years ago, I think we would all expect that much lower prices than we actually have in the mid and upper price ranges would be everywhere and they arent.[/quote]

        agree.

        I think we all expected the prices to dip lower and then level off.

        Rather, the artificial bottom was reached and then followed by a slight rebound created by the govenment and now it is losing grounds again. But how much steam does this drop really have?

        Of course there’s probably subsegment differences. With the foreclosure tsunami tempered, and unemployment steadied, seem like the most likely scenario is for prices to oscillate along this same level from here on until it meet up with inflation. This is certainly a very realistic way for us to reach the “bottom” that we thought would have been.

      • sdrealtor
        January 1, 2011 @ 7:19 PM

        spot on
        spot on

      • bearishgurl
        January 2, 2011 @ 2:16 PM

        Acc to Rich’s graph, the
        Acc to Rich’s graph, the sharp drops since July 2010 appear to have been in the <=$479K category. In the >$479K category, the price drops since July 2010 are roughly half of the drops in the <=$479K category. I am surmising many Piggs still perched on the "buying fence" must be waiting to see if prices in the >$479 category will continue to fall.

        I have no concrete data, but I really feel that MANY properties formerly OVER the $479K benchmark, sold in 2010 for UNDER $479K, whether sold as an REO or “short-sale.”

        Having had two “clients” who gave up the fight and recently succumbed to foreclosure, I DO believe there is still substantial local shadow inventory out there but I predict 90-95% of if will be in the “under $479K” category (a good portion of it in condos) by the time the “fat lady sings.”

        So whomever might be waiting for a non-distressed current listing (w/no structural defects) priced within its nearby “sold-comp” parameters at $575K and up drop to =<$475K, I can see them waiting indefinitely.

      • pemeliza
        January 2, 2011 @ 4:42 PM

        I agree BG that 500k is going
        I agree BG that 500k is going to be a tough nut to crack in the top tier areas especially with interest rates as low as they are. I am not seeing many “steals” in the under 500k category and don’t expect to in the near future. On the other hand, if you go to a second tier area 500k buys you a lot of property these days!

      • Scarlett
        January 2, 2011 @ 6:57 PM

        I think the prices have to
        I think the prices have to get back to BELOW April 2009 level before we can even talk about a bottom along which we will bounce a while. After all, that bounce since then was completely artificial. By spring 2011 (oops, 2011 is already here!) it will be 2 lost years before we continue the decrease since where we left off.

      • pemeliza
        January 2, 2011 @ 11:23 PM

        Whether it is selling when
        Whether it is selling when prices are going up or buying when prices are going down, doing the “right” thing never seems like the “right” thing when you do it.

      • CA renter
        January 3, 2011 @ 12:13 AM

        pemeliza wrote:Whether it is
        [quote=pemeliza]Whether it is selling when prices are going up or buying when prices are going down, doing the “right” thing never seems like the “right” thing when you do it.[/quote]

        Very true, pemeliza.

      • CA renter
        January 3, 2011 @ 12:12 AM

        Scarlett wrote:I think the
        [quote=Scarlett]I think the prices have to get back to BELOW April 2009 level before we can even talk about a bottom along which we will bounce a while. After all, that bounce since then was completely artificial. By spring 2011 (oops, 2011 is already here!) it will be 2 lost years before we continue the decrease since where we left off.[/quote]

        Exactly. Not only have we wasted precious time, we’ve wasted billions (trillions?) of dollars in the process. The total losses won’t be known for many years to come.

        I don’t think it was an “ignorant mistake” on their part, either. The risks have been shifted from the private market to the taxpayers via all of that refinancing, and that was the goal all along; the bailouts gave them the time to shift all of the burdens onto our shoulders (but, somehow, they’ll manage to blame all the losses and problems on the public unions…just watch).

      • Scarlett
        January 3, 2011 @ 8:54 AM

        CA renter wrote:Scarlett
        [quote=CA renter][quote=Scarlett]I think the prices have to get back to BELOW April 2009 level before we can even talk about a bottom along which we will bounce a while. After all, that bounce since then was completely artificial. By spring 2011 (oops, 2011 is already here!) it will be 2 lost years before we continue the decrease since where we left off.[/quote]

        Exactly. Not only have we wasted precious time, we’ve wasted billions (trillions?) of dollars in the process. The total losses won’t be known for many years to come.

        I don’t think it was an “ignorant mistake” on their part, either. The risks have been shifted from the private market to the taxpayers via all of that refinancing, and that was the goal all along; the bailouts gave them the time to shift all of the burdens onto our shoulders [/quote]

        This theory rings true for me. They needed time – but I feel that by now they’ve done what they needed and they may let (albeit gradually) market forces take over and the prices fall.

      • sdrealtor
        January 3, 2011 @ 11:18 AM

        Nahhh!! People love their
        Nahhh!! People love their homes and want the values propped up. Its all part of the psyche of americans. The government leaders want to stay in power so they do what it takes to keep the voters happy. Also high home values equals high real estate tax revenue. Aint gonna happen not before, not now, not ever.

      • Scarlett
        January 3, 2011 @ 12:34 PM

        sdrealtor wrote:Nahhh!!
        [quote=sdrealtor]Nahhh!! People love their homes and want the values propped up. Its all part of the psyche of americans. The government leaders want to stay in power so they do what it takes to keep the voters happy. Also high home values equals high real estate tax revenue. Aint gonna happen not before, not now, not ever.[/quote]

        well, we shall see. I am optimistic that it will happen in next few years. Not saying your rationale is wrong, sdr. It makes lots of (political) sense. It all depends how much the government leaders ARE WILLING TO AND CAN (AFFORD TO) do from now on. ON the other hand, I wouldn’t bet MUCH AGAINST TPTB – never know what TPTB can come up with. Which is why I am more inclined towards buying now :).

      • EmilyHicks
        January 6, 2011 @ 5:16 PM

        Interest rate has been
        Interest rate has been creeping up and this will cause the price reduction to accelerate.

      • an
        January 6, 2011 @ 10:29 PM

        BTW, my numbers earlier were
        BTW, my numbers earlier were just for San Diego City. Here are data for a few other cities w/in SD County.

        Carlsbad:
        >$150k: 3,753 (year 2000), 5720 (year 2009)
        >$100k: 8933 (year 2000), 13218 (year 2009)

        Encinitas:
        >$150k: 3,021 (year 2000), 3355 (year 2009)
        >$100k: 6603 (year 2000), 7558 (year 2009)

        San Marcos:
        >$150k: 516 (year 2000), 1669 (year 2009)
        >$100k: 2245 (year 2000), 4690 (year 2009)

        Poway:
        >$150k: 2,084 (year 2000), 2471 (year 2009)
        >$100k: 4930 (year 2000), 5434(year 2009)

        Chula Vista:
        >$150k: 1,817 (year 2000), 3831 (year 2009)
        >$100k: 6825 (year 2000), 12182 (year 2009)

      • CA renter
        January 6, 2011 @ 10:47 PM

        Good info, AN. Thank you for
        Good info, AN. Thank you for posting this.

      • CA renter
        January 3, 2011 @ 5:23 PM

        Scarlett wrote:CA renter
        [quote=Scarlett][quote=CA renter][quote=Scarlett]I think the prices have to get back to BELOW April 2009 level before we can even talk about a bottom along which we will bounce a while. After all, that bounce since then was completely artificial. By spring 2011 (oops, 2011 is already here!) it will be 2 lost years before we continue the decrease since where we left off.[/quote]

        Exactly. Not only have we wasted precious time, we’ve wasted billions (trillions?) of dollars in the process. The total losses won’t be known for many years to come.

        I don’t think it was an “ignorant mistake” on their part, either. The risks have been shifted from the private market to the taxpayers via all of that refinancing, and that was the goal all along; the bailouts gave them the time to shift all of the burdens onto our shoulders [/quote]

        This theory rings true for me. They needed time – but I feel that by now they’ve done what they needed and they may let (albeit gradually) market forces take over and the prices fall.[/quote]

        Exactly what I’m thinking. Let’s see what they do next; we’re near the point where the truth about the reasons behind all the bailouts will manifest itself.

  3. pemeliza
    December 31, 2010 @ 7:31 AM

    CAR, I think we may well end
    CAR, I think we may well end up at 2001 nominal pricing or lower county wide but I do not believe it will be because of the reasons you suggest in your post but rather psychology. I have no doubt that there are plenty of buyers with the means to by at today’s prices but are convinced that prices are going lower and so are holding out for better prices on better houses. This trend has intensified now that we have seen widespread carnage including in areas that were once considered invincible. I think that other than providing liquidity to well qualified buyers, the government looks ready to let the market forces finally win out now that they dumped the losses on the taxpayer.

  4. CricketOnTheHearth
    January 5, 2011 @ 3:47 PM

    Rich Toscano wrote:
    I hear

    Rich Toscano wrote:

    I hear this a lot but I just don’t see it in the data… per the Census bureau for instance, median household income rose 33% between 2000 and 2008. It’s probably dropped somewhat since then but not substantially. The per capita income figures show pretty much the identical numbers.

    If my income had risen by 1/3 I’d be pretty happy by now.
    Instead, my pay is virtually the same as it was in 2000. Apparently, this is true of a great many of my coworkers in my Fortune 500 tech firm. The hottest topic of conversation is “when will we ever get raises again?” Compensation also shows up in the top 3 areas of dissatisfaction in the corporatewide annual surveys. A number of engineers that I know of have left this company and found (often much) higher pay in others in the county. In my own workgroup several of my coworkers, my manager told me, were completely below the bottom of the payscale for their grades.

    I’d like to know who’s been seeing their incomes rise by 33%, it certainly hasn’t been us. I await whatever data others can gather.

    • an
      January 5, 2011 @ 4:22 PM

      I know several people who got
      I know several people who got a raise between 8-10% this year. Another large Engineering firm in SD gave their Engineer average of 2% last year and 7% this year.

  5. stpiermj
    January 11, 2011 @ 12:07 PM

    Just a hypothesis… The drop
    Just a hypothesis… The drop in prices matches past seanonal changes however, this drop was larger due to a reduction in buyers who are not in the market for long term purchases. There are two types of buyers: long termers and flippers. The long termers are out of the market for two reasons: seasonal (school) and no more tax break. The flippers are still buying and flipping. The long termers bought higher priced homes realative to the flippers. Take out the tax break and no more higher priced (low profit margin) sales.

  6. Anonymous
    January 12, 2011 @ 8:42 AM

    Hey Rich, thanks for the
    Hey Rich, thanks for the fantastic blog. I was a loyal reader from 04-07 till I sold and took the last 3yrs off from all housing data. Now I find myself looking at the prospect of buying in the next 2months or finding another rental. Buying seems better for my fam needs. Anyway, I’m trying to get caught up on graphs and get to know the market again. And this may be stupid question but is there a 100 or 50yr home price trend line for San Diego that you’ve created or Schiff or any of those guys? I know it’s pretty simplistic compared to GRM and stuff like that.

    • Rich Toscano
      January 12, 2011 @ 8:58 AM

      This is the closest I have to
      This is the closest I have to what you are talking about:

      http://piggington.com/shambling_further_from_affordability

      This will be updated this month btw. But there won’t be a huge change in the levels.

      • Anonymous
        January 12, 2011 @ 12:50 PM

        yep that was one of the most
        yep that was one of the most helpful posts I found.Does that 100yr national trend line Schiff/Schiller talk about not get produced for the 20 markets Case/Schiller follow?Maybe that’s the kind of info top dollar clients pay those firms to receive huh? maybe that trend line tells us less than the price/rent info anyway?
        And on a total side note was it CArenter that had a great bubble blog profiling forclosures back in the day? I used to follow JtR, you, and that witty blog that often highlighted loan details from 4closure ranch among others. pass the popcorn…those were the days

      • Rich Toscano
        January 12, 2011 @ 3:57 PM

        You are thinking of ocrenter
        You are thinking of ocrenter (who also posts here sometimes). Loved his blog as well.

        Anyway I don’t know of data that goes back any further than this for SD, but fwiw, I don’t really think it would provide much insight above and beyond this data going back 30-odd years.

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