A quick response would be that those in more affluent neighborhoods have more assets to draw on, prolonging time to default. Just a theory, but I am sure there are other items.

One I spoke to utilized a gain from another house and used the gain as a larger down payment. That said, he has a reset coming that he is not looking forward to. As the resets kick in, we may have a day of reckoning before us. I would reckon that the more affluent areas are all move up buyers and not first timers, unlike inland which would likely have more first timers.

On many occasions Mr. M has stated also that the Jumbo is the third wave, perhaps he could expound on that.

90% of all foreclosures that have gone off so far have been of the subprime variety because the foreclosure process is a year or so. Alt-A and Jubo DEFAULTS which began surging early summer have not resulted in actual foreclosures YET to any great degree but they will begin in a month or so and get really heavy right about when the Spring selling seasons comes around.

Couple surging defaults and foreclosures with no mortgage money over $625k available under 7.5% full doc and no cheap money rom $417,001 to $625k and you are perfectly set-up for a subprime epicenter repeat in the higher priced areas. It has to happen. There is no way around it.

Also keep in mind that while Subprime 2/28 and 3/27 mostly originated between 2005-2007 caused severe problems upon reset most Alt-A, Jumbo Prime and Pay Options are on 5-year reset schedules – the heaviest origination years were from 2003-2007 so do the math – add 5 years. The Alt-A, Pay Options and Jumbo Prime have had time on their side this entire time paying very low payments, renting their home while their value keeps falling. They are now stuck as well.

We are on the leading edge of a major wave that will take housing all over the state of CA down to historic levels of 1 o 4 times median household incomes. Most coastal regions still sit at 6 to 12x.

Any intelligent response would be appreciated.

http://www.zillow.com/real-estate/CA-Palo-Alto-home-value

Do you think that rental prices will also eventually suffer here?
Would be good to move to a similar house at 20% less next year

And thanks to all.

That is why I built my own house. It helped to have an engineering background. I read books on house design, learned AutoCAD and did my own drawings, hired the subcontractors and managed the job full time. I built a house for the future with autoclaved aeraeted concrete that has super low utility bills, low insurnace premiums and practically no maintenance. It’s fire proof, storm and termite pooof and will last centuries. All for less than paying the bubble price.

Do your homework people. Think for yourself. Do research and get facts.

Unfortunately this housing bubble collapse destroyed our economy. Our country is bankrupt. We will be years getting over the depression that just started.

http://www.msnbc.msn.com/id/28035238/