Foreclosures made up a majority of the home sales in Sonoma County in December according to an article in the San Francisco Chronicle. This should be especially worrisome for those looking to sell as this cycle is just begging.
Interest rate resets, which will force even more people out of their homes, will begin in earnest over the first 6 months of 2009 and continue through 2011. Given that Sonoma County was ranked 2nd in the United States for originating some of the worst of these loans, expect foreclosures to increase and prices to continue to drop.
This comment at the bottom of the SF Chronicle article is worth reposting. It is very relevent to Healdsburg and other parts of Sonoma County:
ReplyDeletePosted by: networthy 1/21/2009 10:31:17 AM
2005: "Real estate prices never go down."
2006: "Well, they do in some places but not in the Bay Area. It's just too desirable."
2007: "What I meant is prices never go down in the *real* Bay Area; you know, San Mateo, Marin, SF."
2008: "What? Prices in Marin are down by over 30% since the peak? What I really meant was the *good* parts of Marin and SF."
2009: "Uh oh."
Funny how the "immune" areas keep shrinking and every month there are fewer and fewer real estate apologists posting here. Just wait until unemployment reaches double digits and the Alt-A and option ARMs that were so common in higher-income areas start to reset.
I saw that comment too...classic!
ReplyDeleteI think the greater SFBay is due for an all-out RE meltdown. Psychology and credit has propped this higher than many other areas, and our economy is particularly vulnerable.