Wednesday, June 11, 2008

Chasing the Market Down...Out of a Cannon

In case anyone out there thinks the worst of the price declines are over and it’s time to “take advantage” of the deals out there, I want to provide a sample of the LB real estate carnage I receive in my Inbox every. single. morning:

1919 Beverly Way #102 Long Beach, CA 90802 (I believe we’ve featured this building before): The list price was "$315,000" and changed to "$265,000" ($50,000 reduction)

5418 Heron Bay Long Beach, CA 90803 (we’ve seen this one too): The list price was "$869,000" and changed to "$799,000" ($70,000 reduction)

1054 E 2nd St #303 Long Beach, CA 90802: The list price was "$425,000" and changed to "$350,000" ($75,000 reduction)

917 Euclid Ave Long Beach, CA 90804: The list price was "$475,000" and changed to "$381,000" ($94,000 reduction!)

A pricing bottom you say? Darlin’, we’re just gettin' warmed up.


  1. Nice El Bee,

    Have you checked Mr Mortgage's latest on the May Foreclosure report?

    The tsunami is building more rapidly than many of the bearish had even expected.

    I'm wondering if the sheer number of REOs will cause prices to blow right past fundamentally sound price ranges. I'm thinking more and more that this will be the case.

    Thanks again for your work (and entertaining style) here.

  2. Anon,

    Yes I did see that. Mr. Mortgage is something. And you know what my reaction was? Anger.

    I was pissed off. Not because people overbought, or lied about their incomes, or abused ridiculously weak lending rules, no.

    When I heard about the avalanche of shitty Alt-A loans poised to obliterate potentially hundreds of thousands of "owners" with unaffordable resets in '09 I thought, "Well, heck [not the actual word]. Looks like I'm forced to push back my purchase date YET ANOTHER year. This housing market collapse is going to take FOREVER to unfurl."

    To your point, at first I wasn't bearish enough to think we could blow right past fundamentals, and especially for any meaningful length of time, but with the lack of information or data to the contrary, I have little doubt that it's an absolute guarantee.