"Great news: Home prices have fallen!"

November 21, 2008

From Fortune:

With declines of 30% or more California markets like Sacramento and San Bernadino, home prices and rents in those areas are approaching equilibrium, according to Deutsche Bank analyst Lou Taylor, who compiles a valuable quarterly survey housing costs in 55 urban markets.

As home prices continue to fall, Taylor predicts that dozens of grim markets could reach equilibrium by year end. “We’re getting back the affordability levels of 1999, before the bubble began,” says Taylor.

From the Modesto Bee:

Great news: Home prices have fallen! At least that’s great news for people buying homes. New statistics show home affordability has soared in the Northern San Joaquin Valley as plummeting prices enable more families to attain the American dream…The National Association of Home Builders/Wells Fargo Housing Opportunity Index calculates that nearly 60 percent of homes sold in the region during July, August and September were affordable to local median-income families.
…
The affordability index, however, is only as good as the data it’s based on, and some question whether the income statistics used are current. The index, for instance, calculates that the median- income Stanislaus family earns $56,500 per year. But many workers in the region have lost jobs this year, and unemployment is rising. “Income numbers often lag,” cautioned Dr. Stephen Endsley, a Modesto real estate investor. “It may look like we have housing affordability, but do we really consider unemployment? First-time buyers have to have confidence before they go out and buy, but many of them have questions about (the stability of) their employment.”

From the Stockton Record:

The City Council on Tuesday approved The Grupe Co.’s $3 billion plan to build 7,000 homes in a massive subdivision on a Delta island on the city’s northwest side.
…
Two people spoke against the proposal Tuesday, saying the city is unwise to expand into the Delta and to approve vast housing plans while Stockton is in a foreclosure crisis. “It cannot help but further depress the housing market,” said one of the speakers, Ann Chargin.

From the SF Chronicle:

Jing Hua Wu, the engineer who police say fatally shot three executives at a Santa Clara startup company last week just hours after being fired, spent the last few years amassing a large portfolio of investment properties. According to public records from eight counties in three states, Wu and his wife own at least 19 homes and vacant lots worth more than $2.4 million…Records show that Wu and his wife, Jie Zheng Wu, went on a property-buying spree starting in 2004…In California, they bought a modest home in Elk Grove (Sacramento County)….

[A]uthorities said they are looking into whether Wu’s financial situation had been affected by his foray into real estate before the nation’s foreclosure crisis.

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