My point is that references are being made to housing as a great investment. But, recent history belies the fact that people have lost money in real estate in Southern California even with greater than a ten year hold period. The economic risks associated with housing purchases are rarely discussed by realtors when referring to a house purchase as a great “investment.”
Looking at the Orange County median is problematic given the amount of home construction that occurred during the time in question. Simply stated, on average, homes sold in 2000 on average had more square footage and amenities than homes sold in 1990. Thus, comparisons of Orange County medians in 1990 and 2000 is a bit of comparing apples to oranges and can be misleading. The same held true for Los Angles County, but to a lesser extent given the relatively smaller amount of new construction that occurred between 1990 and 2000, relative to the growth experienced in Orange County over such period. Here are your Los Angeles County vanilla medians between 1989 and 2000:
Again, even for Los Angeles County, the home purchased in 2000 was on average bigger and better equipped than a 1989 home. Luke, explain to me how this was a great investment during this 11 year time period.
Consider someone who purchased the “median home” for 214,831 and sold for 215,900 11 years later. You might argue this is a gain of $1,069 but this is erroneous as there are large transaction costs associated with a home sale. Thus, assuming 8% closing sale costs (commission, escrow, title, repairs, covering buyers costs, ect..), this “investor” would incur $17,292 in sale costs or would net $198,608. A LOSS OF $16,223 ON THE SALE OF A HOME PURCHASED 11 YEARS EARLIER. But the loss would be even greater, as the “investor” would have incurred maintenance expenses over the 11 year period and the monthly homeownership expenses (even with tax advantages) would exceed rent for a comparable home. Someone would have done much better financially, by renting during these 11 years and put the money they saved into the stock market over these 11 years. Now, Luke, explain to me what a great “investment” real estate always is in Southern California.
The risks of losing home value is even greater for purchases made today. The housing bubble in 1989 -1991 was nowhere near as large as to what we experienced in this bubble.
Here is a graph to showing how immense this bubble is:
With all that said, if someone has sufficient assets, they may not care about whether their home decreases substantially in value and there are benefits from home ownership. Further, homes are less expensive than two years ago. But, in my opinion, there are ample rental opportunities to wait out this deflating real estate bubble and someone should NOT buy based upon an expectation of price appreciation for at least 7 – 10 years. In my opinion, there will better deals to be had by waiting.
Don't waste your time asking Realtors if they think buying now is a good investment. It was Realtors who were spouting off two years ago that "it was a great time to buy" and "prices never go down." We all know how foolish that advice was --especially in southern California. According to Realtors, every day during the past 100 years was a great time to buy OR sell real estate -- and remarkably the same will hold true for the next 100 years.
Realtors may be knowledgeable on current and past prices for their area, but they are NOT experts on future price trends. Realtors are not economists and very few have any business or economic training to speak of. They are SALESPEOPLE. The reality is that they only get a commission if you buy, so they have an incentive to be less then accurate as to their assessments. The few competent Realtors with integrity would admit that prices are going down in Southern California and most buyers could save money by simply waiting for the bubble to further deflate.
In my opinion this would generally be a terrible time to “invest” in real estate, unless you must buy now (because of a 1031 exchange, for example). All leading indicators are pointing in the same direction as to the OC market, (i) inventory has increased, (ii) sales transaction volume has slowed dramatically, (iii) lending standards have tightened (pulling thousands of potential buyers from the market), (iv) notices of defaults and foreclosures are at records levels, (v) the economy is slowing (looking more and more like a recession) and (vi) literally thousands of high paying mortgage and other real estate related jobs have been lost in Orange County over the past year. All of these things will put downward pressure on pricing for some time to come.
The reality is that prices will almost certainly be lower later this year, likely lower in 2009 and possibly even lower in 2010. Real estate cycles take many years to play out and we are at the early stages of a down cycle.
I have an MA in Economics from USC and have been in the real estate business for 15 years. In my opinion, this real estate bubble will take a bit more time to bottom out. The previous down cycle was from 1990-1996 and values dropped approximately 20 - 25% in nominal pricing (40 - 45% in real numbers when factoring inflation). The 82 -85 down cycle was a bit shorter. However, that was a period of higher inflation which masked much of the decrease in real prices. Further, none of the previous cycles had the dramatic run up in prices and ridiculous lending behavior which were experienced in this bubble.
Despite what the spin doctors at the NAR and realtors would like the public to believe – it is NOT always a good time to buy.
With that said, if you can truly afford the home with a large down payment and conventional financing and don't care about prices dropping further, consider the purchase. But DON’T purchase with the expectation of future price gains for a long time. Recall, going by OC medians, someone who purchased at the previous peak in 1990 had to wait TEN YEARS before they broke even again in 2000. This was a huge bubble that needs to finish deflating. If history is any guide, prices will not rebound quickly when the bottom is finally reached.
Best of Luck,
You are the epitome of what is wrong with the real estate profession. 3 months ago you reply in all caps that prices are about to stabilize... i.e you were saying back then that it was an excellent time to buy. So now you come back and say you were off base, but again now is an excellent time to buy. 20% off of insane bubble prices doesn't mean it's a great deal. Mid 2003 prices seemed high to me, but they were still somewhat affordable. After that, it just got ridiculous. 20% less doesn't bing us back to earth, it still has us in bubble pricing area. 35% less starts to get a little more palatable for some, but for many they are waiting until it goes down 40%-50% from peak. 36% worked for us, but it's not enough for many people, particularly those earning near the median income.
Buyers trust their agent, so it's your responsibility to be honest with them. Feeding them the old line you used in 2006 that now is an excellent time to buy is either unethical or proves your incompetence. You should really be honest with your buyers and let them know that most likely the house will depreciate further.
At least I qualified bargain with the term relative, which meant to say that there are a handful of properties available today for what the market will fall to in a few months, but who knows where it will ultimately land. There are some of us who were truly ready to own now, but if you don't have all the reasons in the world to buy now, then why would you?
I believe that the question to address here is if we see O.C. prices declining further, and if we believe it will be in a similar fashion to the Inland Empire...not what our personal feelings are on the expertise of people with a Realtor designation. That is probably better left to another thread.
As to the "average" buyer who purchased in 1990 and sold in 2000, they lost a lost of money. When you sell you can expect to pay 6-7% on commissions and related closing costs. Additionally, there was an opportunity costs of money they where utilizing to pay down their mortgage. If they had invested in the stock market during that time period, or even put into CDs, they would have realized a return much higher than the negative return they had with their home purchase. Even factoring tax advantages of home ownership, someone who purchased in 1990 had a higher monthly payment obligation (mortage, insurance and taxes) than a renter. Further, unlike renting, there are maintenance costs with home ownership which are material. Thus, even in Orange County someone can buy a home and hold for ten years and still lose money.
While we think there is a distinct possibilty that there may be a better deal next year, we're ready to own now and prices are finally affordable in Costa Mesa. There are fewer forelcosures there and even though there are certainly more to come, particularly from the people that bought in 2006, there are floors. When houses are affordable, people buy them. I can't see the coming foreclosures staying on the market for long periods and there are plenty of people with the income to buy at today's prices. I could be totally wrong, but the reason we chose to buy now is because we are ready to buy and we doubt that we will get slaughtered and expect that in 10 years it will be the best decision we made. We don't intend to sell in the near future. If we had that intention, we would not be buying now. I expect that it will be several years before there is any appreciation at all and perhaps maybe even slightly lower values in those years. However, during the next few years we will be living in our own house, we will be enjoying having a yard finally (and a dog), having our kitchen the way we want it, along with the flooring and paint choices.
In the first year we will be building over $4K in equity and it will increase every year. The net difference between what we're paying in rent and what our PITI will be after we factor in the tax break is about $400/mo. Next year our rent will be higher if we continue to rent, but our mortgage will not change and each payment adds a bit to the equity. If the same house is valued $10K less a year from now, so what? We've got $4K in equity in the year we've been in the house and we won't be sellers next year, or the year after that, or the year after that. In 5 years we could rent it and be cash flow neutral on an asset that will eventually appreciate on leveraged money.
The bottom line is that if you are ready to own (are financially prepared, have some money saved for reserves after your downpayment and closing costs, the mortgage, taxes and insurance are comfortable for you, your job is stable) and plan to stay in the house for a minimum of 5 years, you are more than likely making a good decision to buy in Costa Mesa now.
I am just a working girl who's been without a proper home for almost ten years (divorce). and am tired of watching all this insanity in souhern california. I happen to work near ground zero for all this toxic mortgage sludge in Irvine. I am a gem and diamond expert who works in the high end fine jewelry biz. I have been watching the condo market here for two years.
Loose money, irresponsible brokers, banks, realtors, and our lawmakers in congress caused this. The reason it went on unopposed for so long was beacuse everyone was getting rich. There is plenty of blame to go around and I believe this whole housing thing has destroyed the U.S and to some degree the global economy. I want to buy in the future but I also want reality. I stay informed about politics and the financial markets and am not some stupid sheeple part of the masses who bought into this entitlement I deserve a house B.S.
That may very well be true, but in 10 years you build a lot of equity and even though prices may not have appreciated, rents sure went up quite a bit between 1990 and 2000. I would expect that even if someone who bought in 1990 and then sold in 2000 would have come out ahead based on those two things.
"I agree that prices will drop for many more years." Good luck making THAT prediction stick.
Your message is growing increasingly irrelevant, my friend. The drumbeats of negativity are being heard by fewer ears, everyday.
I don't see what WAMU is doing as evidence that the sky is falling. In fact, I interpret it to be the opposite. Troubled homeowners had extreme difficulty getting to the loss mitigation dept. Collections wouldn't help them, only tell them that their only choice was to pay. Getting them to loss mitigation quickly is a good thing. The banks are modifying some of the loans, lowering/fixing and or freezing rates that make it affordable. Some are reducing the principal as well. It's in the bank's interest and the real estate market's interest for this to happen. Sure, they are losing money with the modifications, but a whole lot less than if they had to foreclose. The more people that can be kept in their homes, the fewer foreclosures we'll have on the market.
In some cases the homeowner just can't keep the house and a short sale may be the best option for them and the bank. It gets the asset off the banks books a lot faster and costs a whole lot less than foreclosing and these sales are better for the neighborhood.
This means that after approximately 7 year of one of the worst real estate downturns in history, in a matter of 3 years appreciation levels for the decade were up 31.2%. If you had put 20% down on your home in 1990 ($48,471.60), you would have realized a sizable return on that investment, not to mention having a tax write off, a place you enjoy, and no cost of living rent increase from a lovely landlord.
If you let your eyes wander a little above and a little below those two years, the picture looks even better. Like all decisions in life, it's best to think long-term and how your decisions will affect your sanity and the sanity of those you care about over your lifetime, not in terms of a couple of years. If you think and plan for the future, not just the next couple of years, you will be a more whole person, and you will remove a lot of unneeded risk out of your life.
Another good site to check out in terms of real estate pricing trends is HousingTracker.net. I found it interesting that over the course of the past 12 months the city of Orange and surrounding cities values are down 26.5%, but Newport Beach and surrounding cities values are up 6.5%. This goes back to the discussion earlier about how it's difficult to speak in terms of Orange County values, and then apply them to specific neighborhood pockets.
Orange city values: http://www.housingtracker.net/old_housingtracker/location/Ca
Newport Beach values: http://www.housingtracker.net/old_housingtracker/location/Ca
While we all know the market isn't a newsworthy "seller's market" anymore and prices are no longer accelerating at the levels they were in the past & are in fact dropping significantly in many areas, you also have to take into consideration the difference between today's numbers and the numbers back in the 80's & 90's.
Do you think the physical number of homes are more, the same or less than back in the 80's & 90's? Did you happen to notice any home construction over the last decade or two? Of course the number of foreclosures are higher because there is simply more product.
Until they start tearing homes down faster than they are building them, that number will always be reaching new heights.
Also keep in mind that 94% of homeowners with a mortgage are current on those loans.
That said, you live in Fresno, and the situation is much worse where you live. Much worse. Orange County, nice parts of the Bay Area, etc., tend to be more insulated from the current crisis because there were far fewer sub-prime loans going on in these areas.
It's reasonable to believe that the market will continue to be slow, even slightly falling, through the remainder of this year. I would anticipate that things will level off in 2009, and eventually start on a moderate 4-5% appreciation rate from there.
Orange County as a whole should be fairly well insulated from major downward shifts in the market, as there are certain qualities about Orange County that keep it in high demand. Of course, not every place in Orange County is equal, and there are some locations that are in high demand (ocean front), and other locations that are in low demand (certain areas of Santa Ana come to mind). Buena Park is a decent area that seems to be a good location for commuters, among other things. That said, even within an individual city and neighborhood there are areas in much higher demand than others.
My final advice is to find a real estate professional you TRUST. I mean that more than anything else. Find someone you trust and that has your best interest at heart. Even if they are slightly less knowledgeable and polished, this person will help guide you along the right path.
I hope this helped...
If you are looking specifically at the 92626 zip code in Costa Mesa, then probably not. We have seen a period of stabilization in that market over the last five months. Prices aren't slipping or rising. In the web reference below, I will put a link to my OCBeachBlog.com blogsite page on Costa Mesa. I made some graphs for you showing the historical pricing and market activity since 2004 for the 92626 zip code.
- Seasonal Inventory levels are lower than they have been since May of 2006. (It is still a strong buyers market.)
- SOLD pricing per square foot has Costa Mesa back to pre-2004 levels and shows five months of stabilized prices.
- There is an Average Days on Market Graph for 2004 - today
- Market Activity Index shows an absorbtion rate of 9.6 months (The absorbtion rate is how many months it will take, based on the average number of sales, for inventory to be depleted, assuming no other homes come on the market. This number is how a market is defined as either a buyer, seller or neutral market.)
If you find a house that you love, and can afford, and plan to stay in for 6 - 10 years, it won't matter if "averages" dip down some more. They will come back up eventually, and you will have enjoyed living in your own home during that time.
Yes rates are low, but they've been low for awhile now. Don't be pressured into buying a home. Don't believe the hype. When the time is right, you will find your dream home. And by the time is right I mean prices fall another 5 to 10 percent at lease and you go convential and have plenty of cash reserves :)
Additionally, with interest rates low, a lot more people are drawn into an affordable stance. There are lots of professionals who can afford a mortgage between $2000 - $3000 a month, and low interest rates add fuel to that fire.
I think there will be a small slowdown after the current buyer tax credits dissappear after April as well.
Until these fact changes, prices won't lower that much in coastal areas.
"Looks like further declines are on the way" (so much for your credibility)
Based on what data? In MY market NJ, the market is flat (not gaining, not declining any further, thank goodness) we are now in the stage of selling off the excess inventory but the pricing is flat.
To other Realtors who have made valuable and time-consuming comments here ... please keep up the good work.
Swelman ... Are you a licensed real estate agent? Or work for a bond fund? Or write for a newspaper? What do you do? Just curious.
Harrison K. Long, Coldwell Banker Previews, Irvine, CA. http://www.ExploreHomePrices.com
Most of the Doom and Gloom squad seem to either have a bone to pick with the world, or have something either to sell, or something they have been sold.
The source of much of their negative fodder is frequently a biased source like the Wall Street Journal whose livelihood is based on their constituency's earnings of vast commissions through the sale of stocks, bonds, commodities, and funds, and so their "objectivity" is suspect, at best.
As is the self-proclaimed "objectivity" of the vast majority of "Bubble Bloggers", who are hawking subscriptions to their "newsletters", and T-Shirts, and even seemingly "respected" source such as Peter Schiff, is of all things - a stock broker! Who woulda thunk?
I've always found that is best to take the extreme sides of any position with a large grain of salt. Look for the facts, and try to seek unbiased sources.
"If you HAD seriously been out buying a house last year, it would probably have been a modest 3 bedroom, single family detached house, right? If so, you probably would have been in the $350-400k price range, for such a property.
At that time, and for virtually every one of the 12 months since, you probably would have had to compete against numerous other buyers, and ended up paying 101%+ of the list price. You would experience the same situation, and virtually the EXACT same prices NOW."
is not a bit off the mark, for the property I described. It is absolutely factual.
That isn't a rosy forecast, merely an accurate assessment of the hot market in the under $425k price range that has existed for the past 12 months in a row.
Swelman had not indicated, prior to my post, that she was a potential condo buyer. Condos are selling pretty well, in Orange County, also, but condos will never be as popular as a single family detached house, such as I described.
Realtors should be considered a useful tool and information resource to help in the buying or selling process, Realtors don't "make" people buy houses or sell houses period.
I'm not familiar with your market because all markets are not the same, yours may be a little behind mine on the east coast. Overpricing will be cleared out by foreclosures and short sales and that stage must run its course.
What was your motivation to ask the topic question of this blog?
Are you a buyer, seller or just enjoy blogging? Knowing your motivations or asking more detailed questions can help others answer your question in a way that would be more helpful to you.
Medium income and home prices lining up isn't going to happen as long as artificial "Affordable Housing Mortgages" remain available, they only appear to make homes seem more affordable to those who could not otherwise afford to own without special programs in place that would requiring the lenders to offer more and more "affordable mortgage products" which in turn and to contrary to their main reason to exist inflate home prices. It's the human nature of undisciplined and financially irresponsible people to shop in the higher range of their affordability scale.
Unless a miracle occurs causing congress to change their stand on regulation of the very same lenders they've been accepting money from and forcing to offer "Affordable Mortgage Products" to do the opposite and require the lenders to use realistic debt to income ratios and better lending practices and follow these regulations, that income to housing price lining up thing ain't gonna happen.
"Some" congress members are a little too cozy with lenders & lobbyists like Fannie Mae and Indy Mac to actually change their positions regardless what they may say. Republican regulators tried and were slapped pretty hard for bringing up problems let alone calling for regulation reform or acting on the regulations in place. Just take a look at this uncomfortable to watch video of a 2004 hearing where Democrat after Democrat covered up and attacked the regulators "trying" to raise the flag on the Freddie & Fannie Scandal when they still had time to "do something" about the impending troubles on the horizon.
What Caused Our Economic Crisis? Bombshell
Kid simplified version Understanding The Financial Crisis--For Kids and Grownups:
This regular guy explains it pretty well to: http://www.youtube.com/watch?v=N5KqzZn55WM
Lenders don't have the same rules which apply to everyone across the board due to old and new democrat initiatives to level the playing field for the poor and financially irresponsible to live like folks with more money who show financial responsibility.
How you may ask? With home ownership affordability programs (which actually allowed prices to skyrocket in the first place with out of whack acceptable debt to income ratios and crazy payment temptation options like interest only, less than interest only negatively amortizing loans, ARMS, low income housing programs, etc.) Low income housing already existed, it's called a rental...
Supply and demand factors also have a huge affect which will always keep home prices higher in more desired and metropolitan surrounding areas.
In the east coast, particularly the NJ market real estate prices seem to be well on its way to stabilizing however we still have a way to go with getting rid of the excess inventory (approx 10 months worth). The good news is prices don't appear to be dropping further with any significance in the North Central New Jersey area that I operate in. Unfortunately politics is still affecting the inventory issue slowing consumer confidence with bailout spending, raising taxes, resulting job security scares and ultimately keeping consumer confidence down.
At least Obama finally stopped the daily gloom and doom rantings which have resulted in a slight uptick in consumer confidence but only slight despite all the federal and local state buyer housing initiatives in place.
I suppose now it's just a time game, we have to wait for the excess inventory to be sold off slowly as consumers regain their confidence in the American dollar and their job security before they bite on all the great incentive available to them now such as low prices, interest rates, $8,000 tax credit and other local government incentives. My guess would be by mid 2010 if all remains steady with no further outrageous sudden tax hikes or additional gov spending we should be in an official stable market once again.
You are off the mark with the price declines over the last 12 mos in CM for SFR. We bought in May of '08 for $430K, which was lower than almost any other SFR at the time. Our appraisal came in MUCH higher than the purchase price
We put about $10K in improvements and had an appraisal done in Jan, which came back at $395K. The comps since then would probably put a new appraisal today around $365K. Prices are ~20-25% lower in CM over the last 12 months and they are NOT going up right now.
I do think that Swelman will be able to find a decent 2/1, ideally 2/2 condo in a nicer complex for $250K or less. In fact, there are even some fixer SFR's in the low 3's. While this might be out of her price range, when you take out the HOA and factor in the lower interest rates, she may be able to swing it... perhaps take in a roommate?
There is a lot of buying activity now, but there are also quite of few homes that SHOULD have been foreclosed on, but the auction dates are being postponed. I'm not sure why the banks aren't taking back a number of these properties, but there is a HUGE backlog.
Prices on the east side have really started coming down too. We may be nearing bottom over here on the west side, but then you have to look at the large percentage that are at least 90 days behind with a principal balance that is just insane.
I don't fully regret buying last year, but we were so ready for own home and we really love having our own house. However, if we were 10 years younger, I would be really bummed that we didn't wait it out just a little bit longer.
This guy is posting the same message all over the country, not very helpful to the question poster now is it?
Sorry about making this post here, just thought everyone should be aware this character is a spammer.
Take a look at his post history and you'll quickly see they are made very quickly several posts per minute and they are usually short posts bashing Realtors, make your own conclusion. If you feel it's just, click on report to report his posts as spam, off topic or inappropriate.
At that time, and for virtually every one of the 12 months since, you probably would have had to compete against numerous other buyers, and ended up paying 101%+ of the list price. You would experience the same situation, and virtually the EXACT same prices NOW.
Of course if you bought now, your interest rate would probably be 4.5% ( today's approximate rate.) vs. about 6% this time last year. NOW is a time for you to be looking, because the prices are not going down - having been virtually the same for 12 months, in that price range - but interest rates will probably go up.
By the way? Orange County prices will NEVER be as low as prices in the I.E.. If that is your hope, you're in for a major disappointment.
Best wishes to you and your family.
Harrison K. Long, Coldwell Banker Previews.
Be very careful about comments people make or the advice you follow by doing a little of your own due dilligence, this character seems to have created a profile for the sole purpose of realtor bashing, take a look for yourself, he makes posts at the rate of 1 per minute with the same theme (Realtor Bashing), posting that quickly I don't think he even had time to read the full posts!
"Found The Bottom!" Profile posts
If I were to guess this person either lost their home and blames Realtors because todays society in America has a huge lacking of responsibility and has an Entitlement mentality, I like to call it an Obama nation of socialists that likes to blame everyone else for their problems. OR he owns a FSBO site and naturally attacks agents. But that's my 2 cents for whatever its worth, take it or leave it but judge for yourself.
Here is what I truly believe about the prices in our market today... have prices dropped since their insane peak of a few years ago... YES... are prices continuing to slowly drop in most areas....YES... do I see the home prices in Orange County drop like they are/will inland? .... NO.... if you look at the reasons why people buy a home, especially what area they choose to buy the home in... you will see all the reasons why Orange County's prices will remain higher than almost all other counties in California.
People pick a city to live in because of many factors like schools, crime, jobs, entertainment, ammenities, close to the beach, close to the mountains, weather, appreciation and appeal of the city. If you look at what Orange County has to offer versus a Riverside..Corona...Fresno...San Bernardino you can see why the prices THERE have dropped and will continue to drop... they simply don't even come close to giving you what Orange County can... almost any city in Orange County will retain it's value better than those cities...
Yes cities like Anaheim and Santa Ana have a lot of foreclosures and will continue to have more in the future which will cause the prices to lower yet those are due to poor lending practices and borrowers who never intended to repay their loans. On the whole Orange County should bounce back with a vengeance once the economy finds its legs.... I would highly recommend finding a city in Orange County that you like... and that works for your needs... and then.... find a home/condo that you can afford... and you will be extremely happy that you did in 5 to 7 years...
Most of the short sales are being delayed to the point for these properties are becoming REO's according to my friends' sisters' so they are just delaying the process in the end. This will in fact drag out the foreclosure crisis we are in today because all of these REO's eventually will be dumped on the market in the future because WaMu must get them off there books. The more short sales that fail to close escrow means just more inventory down the road WaMu is holding the line why the hire more people so it looks like they are trying to correct there own mess with these mortgages. It's all smoke and mirrors according to the sisters' and let's face it WaMu is not doing well as a company just look at the stock price. Nobody was watching the store at WaMu just like Countrywide and now the horse is out of the barn and they are trying to close it.
Another anecdote for the soup:
My sisters' are service managers for WaMu's debt collections joint out in Santa Clarita and they both tell me that WaMU is still in the process of a huge ramp-up in response to the avalanche of people unable to pay their mortgages on-time.
BUT they are hiring more debt collectors in order to help facilitate the lengthening of the average foreclosure process.
When troubled borrowers are tapped out and their late mortgage payments start turning into no mortage payments, collectors hit them will all the possible options, of course, - refis, loan mods, post-dated checks - anything to get that promise to pay. But when borrowers say they STILL can't pay, agents transfer them immediately to the "loss mitigation" department that pushes them towards the short-sales option.
Nothing worng with that, per se, but it's interesting to note that once a short sale process is started, that same department, understaffed and usually unwilling to accept real losses on the property, can offer little real help to the borrower, though all together it can add months to the foreclosure process. At this point, my sisters' say, the loss mitigation department it's just another internal mechanism to forestalling and prolonging the inevitable foreclosure process as WaMu is incapable and unwilling to process large numbers of foreclosure.
And so they do what their bosses want them to do. And they stem the tide.
That is a very small drop in the grand scheme of things, representing a decline of just .1 percent. But it's the first time in a long time that employment has turned negative at all. The data I pulled from the Employment Development Department website goes back to the year 2000, and it shows that even during the recession and slowdown that took place at the beginning of this decade, the weakest month showed a year-over-year increase of 2,300 jobs.
So even though we are not in an officially recognized recession, San Diego's employment situation is worse than it ever got in the aftermath of the 2001 recession.