Real estate slump hitting county residents hard - Santa Cruz Se...

William Purdy, a Soquel real estate attorney, sees the economy spiraling downward.

[What is he thinking]

Purdy wants the Feds to jump in and bail out all the people who created this mess? Why should my taxes help the sleazy greedy people?

[el gato]

Throw 'em a rock.

Real estate prices need to come down to something approaching realistic. Don't use my tax money to prop up prices that were hopelessly inflated by easy money, lax lending standards, and outright fraud.

Disclaimer: Yes, I'm a homeowner.

[RobtA]

Has anyone tried selling those homes on eBay? Well, why not? I might put in a bid for $400. That's four hundred, not four hundred thousand.

[bncsc]

I agree "what was he thinking"......I will never be able to buy here, a place where my family has llived for generations because of greedy, slimely people!! Real Estate agents and the greedy homeowners did this to themselves....I don't feel bad whatsoever.

[jarbee]

You get what you pay for. Location, location, location. This is Santa Cruz. Maybe prices will dip some more, but there will always be a high premium to live in one of the most beautiful spots on earth. If you don't care about quality of life, then go buy a foreclosure in Ohio. That's cheap.

[nohouse]

bncsc,

Don't forget the mortgage loan guys. They supplied the easy money to artificially raise the price of the properties to an unreasonable rate. I knew this would happen when I saw the crazy loans offered to me three years ago. I desparately wanted to buy a house, but in a good conscience, I could not take a part in this frenzy.

[Reciprocity]

Santa Cruz is not "one of the most beautiful spots on earth. All of those areas are along the equator, in what we call the tropics. The "premium" people pay to live here is aimed at keeping people out so as to negate development, which Santa Cruz has been about for the last 40 years. Obviously it hasnt worked, but we keep right on having a high cost of housing, which has totally screwed a lot of people. Hawaii has about the same real estate prices as here, now do you really want to compare Honolulu to Santa Cruz main beach? Thats laughable.
For all of you interested in the economy, read this link its kind of an eye opener.
http://falkvinge.com/2008/03/why-us-is-collap...
p.s. I dont want any "if you dont like it here move" responses to this comment. Taht is a foolish line of reasoning used by people unable or unwilling to think.

[SC Native 4generations]

bncsc I will never be able to buy here, a place where my family has llived for generations because of greedy, slimely people!! Real Estate agents and the greedy homeowners did this to themselves....I don't feel bad whatsoever.
Well Said, I also will never buy here and have had family here for generations. none of us can own. In fact I don't know anyone that has lived here for generations that can or does own. Everyone rents. Only the valley types or trustfund losers can own here.
This "crisis" is partly based on greedy real estate and mortgage lenders. They should all be investigated and held responsible. "B" properties is one of the worse offenders. I do not agree with taxpayers bailing out these people, ignorance does not justify a free ride. Mortgage lenders and real estate people should be put out of business.

[TOC]

So sad, but this real estate crash is hurting. And it's only going to get worse. I know so many people whose mortgages make sense. They wanted a home, they wanted a good place for their families. But now they're in trouble.

[Buy High Sell Low]

SC Native:

Real Estate was dirt cheap 17 years ago after the 1991 crash - I first bought 2000 sq ft in Live Oak in 1998 for 24% above my house's bottom listing price in 1994 with a 50K downpayment (20%)- it only got crazy after that. That your family lacked the financial foresight to have enough money lying around to buy is as much your family's fault as the plight of idiot flippers and speculators today.

You don't need a six figure income to build up an enormous nest egg if you have 4 generations to get it together. And even if real estate crashes 50%, it sounds like you're still out in the cold because you're not planning ahead.

There will be plenty of SC natives buying when we hit the bottom - and plenty of them will be the sort half the middle-aged white guys on here want to deport because they *do* know how to save.

While this may sound harsh and overly critical, start planning ahead, there will always be opportunities if you're ready for them. Because the guys mowing your apartment complex's lawn and hauling away your garbage are.

[Tedd]

Here we go again with more realtor mis-informaton. First off, the real estate "slump" is simply buyers no longer being able to afford outrageously high prices. House values jumped far beyond inflation due to the mortgage industry's "easy money" scheme that is now coming home to roost. If you consider a 10% drop from a 200% gain a "catastrophe" it is only because the truth is that most people cannot really afford such a home. Second, most of these people were more interested in becoming a coveted "homeowner" than being financially intelligent and taking the time to read their loan docs. Or gave into the housing-as-no-lose-investment mentality espoused by the realtors and mortgage brokers: "housing only goes up, you can refinance or sell later when the value is even higher".

This is a user-created mess, not some random "catastrophe". Newspapers reporters should be more objective and knock off the realtor-echoed mis-information and "victim" story campaigns.

[ADP]

"...the government has to step in..." NOT!!

The ride is fun up but awful when you come crashing down. I do not believe that millions of people are that ignorant in what they were doing. You gamble... you loose. There is no reason that the rest of hardworking America has to pay the home prices that are so inflated because someone else wanted a home and the plasma TV and the new SUV and fancy trips. Why should hardworking people have to pay for other peoples' lifestyles?

[loanrealestateag ent]

Hey,
If I were the real estate agent, I would try to sell a property at much higher price. If I were a mortgage lender, I would make the money available much easier. If I run out of options, I can create something more exotic to keep it going, so I can squeeze more money out of real estate. If I get paid, who cares what happens in the end.
I have no responsibility, and it is not in my hand any more. I will just tell people that they need to refinance. It is their responsibility to refinance, not mine. The good time is over, but I am doing pretty good with Ferrari and the retirement savings. Who is going to come after me? Remember I didn't stick a gun to their head.

[mink]

My favorite part is: "People were encouraged to borrow money they couldn't pay back under any circumstances," said Purdy. "Dozens of people this happened to."

Like these people are squid or something. It "happened to" them. And by the way, I'm still confused as to why someone who put zero down on their house and now has to walk away qualifies for victim status.

[former aptos resident]

A good rule of thumb... if you cant rent a house for a little more than your mortgage payment... dont buy it..

[former aptos resident]

How many of these people that bought houses thought the value would go up 100,000 in one year. ALMOST ALL OF THEM. They are greedy people that thought they could get rich quick. They get what they deserve. They need to walk away, and go back to renting like they were doing before. California... The tredmill state... =) you work hard and go knowhere.

[All of the US is]

Work hard and go nowhere...

[Capitola]

Just another example of a majority of people being greedy and getting caught. I'm sure there's a few percent of people that may have not realized the extent of a negative amortized loan (although the word 'negative' would be a big clue). The rest are people who should have known better and are now trying to get out at the expense of tax payers...looks like the S&L fiasco all over again. The responsible people will once again bail out the irresponsible.

See ya in 3-5 years, once prices begin to level out.

[Ignorance prevails]

Reciprocity wrote:

Santa Cruz is not "one of the most beautiful spots on earth. All of those areas are along the equator, in what we call the tropics. The "premium" people pay to live here is aimed at keeping people out so as to negate development, which Santa Cruz has been about for the last 40 years. Obviously it hasnt worked, but we keep right on having a high cost of housing, which has totally screwed a lot of people. Hawaii has about the same real estate prices as here, now do you really want to compare Honolulu to Santa Cruz main beach? Thats laughable.
For all of you interested in the economy, read this link its kind of an eye opener.
http://falkvinge.com/2008/03/why-us-is-collap...
p.s. I dont want any "if you dont like it here move" responses to this comment. Taht is a foolish line of reasoning used by people unable or unwilling to think.

Reciprocity:
Have you ever been down to near the Equator? I have, it just so happens that I was born and raised in that part of the world. Even if you have been there, Santa Cruz is one of the most beautiful spots on Earth, as that is someone's opinion, one they are entitled to. I happen to also agree with that opinion. All you need to do is drive (your hybrid, naturally, lol) up to UCSC and stand on the hill and look at the entire bay, all the way down to Monterey. I've lived here for over 18 years and it's breathtaking every time, particularly on a clear day.
People tell you to move if you don't like it because this is a free world. Rather than complaining about where you now live, they are encouraging you to move to a place that matches your level of culture and intellect. That's why they do it. Perhaps, it's aimed at your lack of thinking, but you wouldn't recognize that, obviously.

[Ignorance prevails]

Buy High Sell Low wrote:

SC Native:
Real Estate was dirt cheap 17 years ago after the 1991 crash - I first bought 2000 sq ft in Live Oak in 1998 for 24% above my house's bottom listing price in 1994 with a 50K downpayment (20%)- it only got crazy after that. That your family lacked the financial foresight to have enough money lying around to buy is as much your family's fault as the plight of idiot flippers and speculators today.
You don't need a six figure income to build up an enormous nest egg if you have 4 generations to get it together. And even if real estate crashes 50%, it sounds like you're still out in the cold because you're not planning ahead.
There will be plenty of SC natives buying when we hit the bottom - and plenty of them will be the sort half the middle-aged white guys on here want to deport because they *do* know how to save.
While this may sound harsh and overly critical, start planning ahead, there will always be opportunities if you're ready for them. Because the guys mowing your apartment complex's lawn and hauling away your garbage are.

I totally agree with you, and I don't find it particularly harsh. My wife and I moved here in 1991. My wife is a native who grew up here and only left for college. In 92, we bought a townhome in Aptos for 216K, and sold it in 95 for 215K, which actually meant a LOSS. We bought again, this time on the Westside, at 244K in 98. That's less than ten years ago. We just bought our third house after that one and the sellers had to drop the price 100K because we had to drop ours. But as "Buy High" declared, we planned ahead. We now have over a half million built up in equity and, when the market rebounds, will recoup the drop in prices and our equity will jump to close to 750K. Our original "down payment" was 58K, which was part wedding gift and part savings. We don't have the latest cars with all the "bling" and "pimpin" that everyone must have, we don't have the latest phone, latest iPod, latest flat screen. We don't wear the trendiest threads, don't pay thousands for tattoos. But when we retire (we both work in Education, so we are not rich), we will be (literally) millionaires.
We always purchased fixed rate mortgages and had set monthly expenses, and lived within a budget. And we've managed to save money and travel and enjoy ourselves quite a bit, including yearly vacations. It can be done, folks. But anyone who signed papers for a loan that matched their monthly income, knowing that the interest would jump in six months is plain irresponsible. That is the reason many people are in trouble today. To quote "Buy High" again, people need to plan ahead, something this generation doesn't know how to do.