A Look Back at 2008

From the Press Democrat:

The problems began with housing's deepening decline. Foreclosures spiraled to record heights with banks taking back nearly 60 homes a week -- four times the number a year ago.

Most vulnerable are those who bought around the peak of the housing boom three years ago with risky loans featuring low initial payments that explode when higher interest rates kick in. If they now owe more than the home is worth on the market, there isn't equity needed to refinance. Selling is the only alternative to foreclosure, yet it's a struggle in a market flooded by bank-owned homes.

Sales finally started to pick up this fall as prices hit seven year lows in Sonoma County, plunging to $325,000 after reaching $619,000 in 2005. But sellers still outnumber buyers and economists have said prices likely won't hit bottom until the second half of next year.

Tighter mortgage lending has hampered sales, particularly for the market's upper half, reflecting lender caution in the wake of rising foreclosures.