You really need to look at the year before to see how the market performed – and from the statistics, we can see the median home price, county-wide, is actually down 33.5% in April of 2009 compared to a year ago. … Honestly, I am mystified how people can take a few anecdotes, completely ignore the state of the economy and the housing market as a whole, and now herald, with strident authority, that we are now at the bottom of the market and THIS, TODAY is the time to buy, or you will miss out on the chance of a lifetime. … Well, that’s not true – short sales can also occur at those prices, and some people who have had their homes a long, long time may have enough equity in them to compete with all the REOs and short sales. … Personally, I think it’s going to put increased pressure on the bottom of the market, as many people who were looking at buying a lower-priced “starter” home may now be thinking of stretching to go for one of these “premium” foreclosures which I expect we’ll be seeing.
A good portion of people who receive notices of default will be able to cure the default or sell the property via a short sale before the actual foreclosure happens.
…I think that in many cases, folks just don’t see much upside in making exorbitant mortgage payments on a property worth perhaps half of what they paid for it two years ago. It’s one thing to struggle and fight to keep something that’s worth something; it’s another to throw money down a sinkhole of a mortgage where the upside is perhaps many years away.
…It hasn’t hit the more affluent parts of Santa Cruz yet, not really – but with the median price dropping in the county the way it did in Januar y, perhaps we’ll see the foreclosure crisis spread from the extremes of the county to its heart.