My time is short, so this is another quick post.
At this time of year, the Santa Ana winds and fires rage across southern California. It is thus worthy to consider the other fire raging in this majestic, fragile and somewhat crowded state (where I too am a property owner and taxpayer).
I am cutting and pasting this data from one of the sites I visit daily (JS MineSet). Posted by a regular contributor (Monty Guild). Mr. Guild's comments follow:
Here are a few SFR (single family residence) statistics from a mortgage banker friend of mine.
This information is focused on California, but you can probably get the general US message.
- Foreclosures made up 47% of all CA SFR sales in August 08, up from 9% in August 07
- Median CA SFR price was $350,000 in 8/08 down 40% from $590,000 in 8/07 (down 41%)
- 2008 SFR unit sales are on pace for 490,000 units, up from 313,000 in 2007
- Current unsold inventory sits at 6.7 months VS 10.6 months in 8/07
- New SFR permits are down 53% so far this year
- Single family construction loans are now 12.5% delinquent, and condos 16.5%
Damaging though the winds of nature can be, the damage caused by government-sanctioned financial speculation and excess can be greater still.
In my view, the policymakers who pumped the economy full of easy money should bear the brunt of the responsibility for the damage caused, though all the way down the line, every participant knew better: from the bankers and lenders who knowingly signed mortgages with unqualified buyers, to the home-buyers who knew that they were stretching beyond their means to sign, to the speculators who broke the buyer/seller and lender/borrower relationships by slicing, dicing and repackaging the mortgage contracts as though they were commodities.