March 2008 DQ News.com numbers are out:
Bakersfield Median is down 20.56% YOY (down to $225,000)
Bakersfield Median peaked at $315,000 - we are now down 28.58% from the high.
Tuesday, April 22, 2008
Bakersfield prices down 29% from the peak
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29% my a$$.
I know of a bid on a home in the westchester area at $100 per sf. Whether or not the owner grabs the hook is another story. It looks like a reasonable offer at this point.
Argee. These numbers don't include incentives which would add 5-10% to this % loss.
What!? 29% down? That can't be!
I thought real estate never went down? I thought Bakersfield was a unique market; we are more affordable then the rest of California, we are a bedroom community for LA, we don't have the same speculative buying that other markets have, blah blah yadi yadi.
Man, it would be nice to see the Californian do a piece on statements made during the boom. Of course they would never do that. Maybe it's time for BB to gather some of those statements and print them here for all to see!
The 'Bakersfield Life' interviewer should have asked Busby this "So you think things are getting better and it's time to buy, but what about when you said it was time to buy in mid 2006 and that Bakersfield is a safe market to invest in?".....crickets, chirp, chirp
LMAO!!
Busby was on the 17 special in the summer of 2005 (at the peak) along with Crabtree and several other cheerleaders.
Busby stated that prices will go up 10-15% for the foreseeable future. WTF????
I have asked 17 news several times for a copy of that show (I want to put it on youtube and link it), however they have refused.
According to the "experts", it's always a great time to buy.
I love Lennar's radio ad claiming that "the market has hit bottom" - so come on in and buy a house (plleeeaaassssssee).
If it was such a great time to buy, then why aren't the experts out there grabbing up cheap houses to rent out? There was no shortage of that when we were looking to buy in 2004. Every house we saw a "for sale" sign pop up on was pending by the time we called the number - next thing you know, it has a "for rent" sign on the lawn.
Yeah its a great time to make a commission.
"next thing you know, it has a "for rent" sign on the lawn." And now it has a foreclosure notice posted on it!
WoW! Kern County is getting clobbered.........but riverside and S.D. look even worse! Yikes!
I guess one good sign is that over 500 homes sold and that seems to be more than most of CA so people are buying in Bakers and I have been starting to see what seems to be some "realistic" prices. So at this point how much further do you think we have to drop?
That is the question now isn't it? How much futher will we drop? Very interesting and I think about it often.
Here is my guess. The real estate market in Bakersfield has always reacted in similiar ways to the coastal markets, but there is usually a 6 to 12 month delay. So, whatever dcelines are being seen in say, San Diego, I think it's safe to assume we will see at least that level of price depreciation here in the near future. Also, I don't think any of the markets are done dropping. I belieive, and correct me if I am wrong, but the majority of the arm loans are only right now starting to reset. This would mean we are 1-2 years away from the foreclosure crisis peaking. When that peaks I would think we will have further price drops. And, the economy is only getting worse, fewer jobs equal fewer houses sold equals lower prices.
I am going to go out on a limb here and say we will bottom out at around a 50% drop from the peak and that will be around 18 months from now. 50% I think would put us back in line with the historical average for appreciation for housing, which usually follows inflation pretty closely.
bellcurve - Thanks for your thoughts behind your predictions. I somehow seem to agree with you. I guess anywhere from 18 to 24 months for the housing market to stabilize. I will stay put in an apt. until then.
Here's my 2 cents...there are a lot more renters with bad credit now (former homeowners who lost their pads) and there are a lot of wise people out there who either were clarvoyant or just not in a position to buy near the frenzied peak. So there are renters out there with good credit and renters out there with bad credit.
They all need somewhere to live. When the rental market is hot, the price of rent goes up - supply and demand.
When people with good credit get booted from a house that is going into foreclosure (and it happens all the time), they have to compete with the ones with bad credit for houses or apartments to rent. Landlords get greedy because of all the applicants and raise the rent based on demand, the good credit peopleget sick of the renting and the competing and start looking at houses they can buy for the same price as rent, or even much lower.
At some point, rents are going to equal or surpass the price of owning. That has got to be close to the equlabrium point.
Like my neighborhood - rents are around $1200~$1350. My mortgage is right at $1350 including taxes, insurance, principle and interest on a 6.1% 30 year fixed. I could barely sell my house for what is owed. I bought in 2004 for $175,000. So if my next door neighbor sells for that, the new neighbor will have almost the same mortgage as mine. If my next door neighbor rents it out, the rent will be almost equal to my mortgage payment. See what I am saying? If you were looking to rent or buy in my 'hood, and either one cost the same, who would choose to rent? If prices continue todrop another 18 - 24 months, it will definitely be much cheaper to own than to rent on my street. I am sure it is the same all over the place.
So I think the equalizing will have something to do with the rental market and what it is doing.
On the up side, only people with good credit who can afford the loans are actually buying houses now. No more 19 year-olds with 4 room mates turning family houses into frat houses for a while.
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