Comments on: Breaking: Home Prices in US Down Again - Eight Months in a Row http://www.biggerpockets.com/renewsblog/2007/10/30/breaking-home-prices-in-us-down-again-eight-months-in-a-row/ Learn, Network, Invest Tue, 07 Oct 2008 07:07:54 +0000 http://wordpress.org/?v=2.6.1 By: Bob in San Diego http://www.biggerpockets.com/renewsblog/2007/10/30/breaking-home-prices-in-us-down-again-eight-months-in-a-row/#comment-51951 Bob in San Diego Wed, 31 Oct 2007 17:45:29 +0000 http://www.biggerpockets.com/renewsblog/2007/10/30/breaking-home-prices-in-us-down-again-eight-months-in-a-row/#comment-51951 We have only seen the start of the decline in markets like San Diego. At the moment, the foreclosure problem is primarily sub prime centric, with clusters of REOs in a handful of neighborhoods. The downward trend will accelerate as foreclosures move into the more upscale neighborhoods. It won't be a sub-prime issue, but a debt overload issue. Not everyone with Alt-A credit (or worse) used option arms and interest only financing to purchase. In 2004, IndyMac said that 65% of their funded loans in San Diego County were NOT fixed rate. With those loans adjusting payments up, the monthly debt load will be more than many can handle. We have only seen the start of the decline in markets like San Diego. At the moment, the foreclosure problem is primarily sub prime centric, with clusters of REOs in a handful of neighborhoods.

The downward trend will accelerate as foreclosures move into the more upscale neighborhoods. It won’t be a sub-prime issue, but a debt overload issue. Not everyone with Alt-A credit (or worse) used option arms and interest only financing to purchase. In 2004, IndyMac said that 65% of their funded loans in San Diego County were NOT fixed rate. With those loans adjusting payments up, the monthly debt load will be more than many can handle.

]]> By: Austin http://www.biggerpockets.com/renewsblog/2007/10/30/breaking-home-prices-in-us-down-again-eight-months-in-a-row/#comment-51941 Austin Tue, 30 Oct 2007 23:09:50 +0000 http://www.biggerpockets.com/renewsblog/2007/10/30/breaking-home-prices-in-us-down-again-eight-months-in-a-row/#comment-51941 I have been hearing from a few sources that the national market and in particular places like California are going to get worse before it gets better. But does anyone have ideas on how long this process will take? I have been hearing from a few sources that the national market and in particular places like California are going to get worse before it gets better. But does anyone have ideas on how long this process will take?

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