Saturday, May 28, 2011

Update On Our Street

A number of houses on our street in Elk Grove have been listing as short sales lately, and I get the feeling the wheels are being greased on the foreclosure machine. One neighbor of ours just listed their house as a short sale after receiving a Notice of Default last month. Turns out they hadn't made a payment in 30 months! The house originally "sold" in early 2008 for around $300K, and is now pending for under $220K. The real stunner is when I ran older sales for our neighborhood, I found an identical house that sold in 1990 at the height of the previous bubble, for, you guessed it, $220K! That's 21 years with negative appreciation!


J. Miguel said...

Thanks for posting these updates, they are a great supplement to all my local research.

Incidentaly, do you think the pricer per square foot is being held up artificially? its been stuck at $117sqft for a couple of months now.... shadow inventory is growing, distress properties are still high, yet that number is unchanged. Your thoughts please...

inculcator said...

I suspect higher end homes include more acreage, distorting the price per square foot. We see the same for median price, too. In general, prices are still falling, but larger homes are an increasing portion of homes sold, propping up median home values.

Boba the IX said...

Max, why look at this from a negative standpoint: "Negative Apreciation".

This is 21 years of "Positive Depreciation."

Just sayin'.......just kiddin' .......really.

Max said...

@ Boba: Love it! You should work for NAR or Obama. ;)

My thesis is we won't see a real demand return until 7-10 years after the foreclosure peak, since that's when credit scores will recover. Until then, we'll bounce around the long-term trend line, which translates to 0% appreciation after inflation.

Kinda amazing to think that an entire generation (Gen X) has probably net-net lost money on housing. 21 years ago, the oldest GenXers were 25.