Housing downturn may hit California hardest, experts warn

[Newsjock]

Source: San Francisco Chronicle

On the same day a real estate trade group reported the housing market is on the verge of stabilizing, experts on California's economy say the state could see a more dramatic and prolonged downturn than other parts of the country, in part because more recent buyers relied heavily on risky loans here.

Esmael Adibi, director of the Anderson Center for Economic Research at Chapman University in Orange, is forecasting a 9 percent decline in average home prices on the statewide level in 2008. And he said an additional 15 to 20 percent drop in 2009 would not be out of the question.

... "I don't see anything that would suggest the current downtrend is going to level off soon," said Michael Carney, executive director of the Real Estate Research Council of Northern California. "In fact, I think we might be seeing a gathering of momentum in the downward direction. I think we're more toward the beginning of a process than toward the end of it."

Certainly, the statistics compiled by San Jose real estate firm owner Richard Calhoun seem to show a buyers' market still tumbling farther. The median asking price for a single-family house in San Mateo County, for instance, has fallen from $948,000 in November 2005 to $767,000 this November.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/12/10/BUJTTRIP1.DTL

[obiwan]

1. Ya Think?

[hogwyld]

2. Classic supply and demand

When people are no longer interested in paying exhorbitant prices for housing, the prices have to come down. This is good for the common people in that the fat cats that ran up the prices get to lose for once in their lives...

[BR_Parkway]

3. I'm still blown away that there were that many single families who thoought

they could afford a $948,000 house. I'm amazed that many people could suspend that much reality for that long.