The Scariest Housing-Related Chart Ever

Posted on December 30th, 2008 in Mr Mortgage - News Picks of the Day!, Mr Mortgage's Personal Opinions/Research

Below is a chart of CA median home prices as reported by DataQuick. I am working on a project, which I will get out to you shortly.  These data are part of it.

Take this opportunity to write your own blog post in the comments section below about what this tells you.  I am curious to hear what is the first thing that comes to your mind when seeing these numbers. Have fun. -Best Mr Mortgage

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159 Responses to “The Scariest Housing-Related Chart Ever”

  1. Great chart, so as billions of our tax dollars go to banks that gambled for 5 years (making billions), automakers who (other than jobs/that are left in the USA) were headed strait to BK-they need the banks to lend as well, now retailers want a piece of the bail out money and who’s next Ruth Chris Steak House or the Las Vegas Casino Community.

    I think there’s about 95% of you that are against bailing out the American Homeowner, with American “TaxPayers” own dollars, yet you are willing to allow ‘O’ let’s say 270 billion dollars get handed out since what January 2008 to financial firms (mostly) by “Paulson and the wall street fleecers” and the fact that our situation in even worse day then it was one year ago-somehow is justifiable as long as that family next door doesn’t get to keep their home because Joe over there bought a pool with his refi money.

    To you 95%, have you ever seen the three monkey’s (statue) figurine-with one -hands over eye’s-over mouth-ears, etc… that’s YOU when our money is given to the groups that have been stealing from us anyways-why not a few hundred billion more-RIGHT… When common sense and human compassion says save families from losing there home-the natural desire to help is paid back 10 fold…

    If a year ago 350 billion dollars went strait towards modifying the 12 Trillion in outstanding mortgage obligations, offset Junior liens with IRS incentives as well as investor losses-Does anybody really believe as Paulson & the Great financial minds directing our 700 billion did and does still-remember the other 700 Billion to purchase a corrupt Fanny & Freddie-those great minds told us that would fix it-nope you don’t remember do ya monkeys.

    Anyways, with each morning as you 95% walk out your front door and see another homeowner lose there home to the bank (that received 25 billion free the day before)and you say to yourself I didn’t like them anyways, and yell no charity loser as they are forced to leave by the sheriff. As you turn to walk back into your home feeling like a million bucks since you said what the TV or the media at large tells you to believe to be right. Remember this these unique times will be remembered for a very long time in American History. How are you going to be remembered, as one of the heard that gets lead around by the media-you know want to be on “E” or just like some CEO or relevant to the guys on CNBC/Bloomberg that you’ll never know and they will always have job security with you watching. Or can you use that over priced college education to make a difference, Obama has been given a reality check and he is a great speaker but our government officials behind closed doors are in the “know”-they know it’s bad and just going to get worse. So he will blame Bush. Wall Street for the most part has become a huge burden and seems more like a Pon-zi scheme and the American Taxpayer is the “mark” and you still think the balance sheet approach is reality “Housingrealist”?

  2. This I find amusing. Mr. Mortgage said to see what comes first to mind when you see the deterioration of the Ca. housing market. Most of you look directly down at the bottom number and say “Wow dude the Ca. Housing market is down that far?”
    Where are you living you ignorant SOB’s? This is only affecting the lower priced homes? Are you smoking crack? Upper end housing is taking it in the shorts across the board because investors in the secondary market are not buying jumbo loans. The jumbo loan market is dried up like the Mojave Dessert. The only thing keeping our market going is the lower end of the market. And be thankful for that!!!!

    Now onto what Mr. Mortgage is getting at.

    Look at the time when the prices started falling off the cliff. It was when the exotic loans started to go away and then the momentum of the market losing its pricing became apparent. Then it became the perpetual snowball where most of these loans ( many exotic (POA’s) loans) had no place to catch themselves and hence the start to the default problem we are now watching happen minute by minute. The faucet was turned off when the exotic loan programs went away in August of 2007. From there we have seen a major free fall.

    Is this going to get better anytime soon? If you think so then let me know your drug dealers number so I can smoke the same stuff as you. This is going to get much uglier before it gets better.

    Rock on Mr. Mortgage! You know your stuff. Keep preacing the truth!

  3. News Flash….the whole market is a ponzi scheme as is our Social Security system. The big concern on Wall Street is how can Wall Street overcome the perception by main street that the system is NOT fixed.

    Why do you think the government created all the retirement accounts? So the little guy has a way to participate in the markets. Who benefits most? The market makers at the top.

  4. Vegas,
    see you in march 7-11

    The Winners are: intermediaries, wall street investment bankers & depository lending institutions
    The Losers: borrowers/tax payers (Americans)
    Since the Government stepped in to help the America People
    The new Winners: Banks-their paying off their wall street investors.

    The market is now a Ponzi scheme, the only risk from wall street is if the government doesn’t believe them when they say your going BK, unless you bail us out-then we’ll lend. Works every time.

    Before the little guy had a retirement account government or private.

    The debt or securities are insured so where is the pay off for these dead assets????


  5. […] Het probleem waar het allemaal mee begon, dalende huizenprijzen, is nog lang niet voorbij. De daling van de huizenprijzen in Californie gaat heel snel.. bron: […]

  6. If there is 12.1 Trillion Dollars in outstanding mortgages, with 1 out of every 10 homeowners with a mortgage deliquency of 60 days or more(10%) or there are 4.6 million homeowners deliquent, both deliquent quotes came from Moody’s and NAMB in an article dated 1/09, so lets assume the fiqures are correct.

    Now in an earlier statement around 10/08, Moody’s estimated that 1 out of every 5 homeowners was near or already underwater. Using the same fiqures of 46 million mortgaged homeowners equals 20% or 9.2 million homeowners are underwater and half of them have trouble paying the mortgage already. The reason I said already, is there is still alot of adjustable mortgages waiting to re-set.

    If we just use the total outstanding mortgages of $12.1 trillion dollars times the 20% that are underwater and persuade/force/mandate the banks to give a principal reduction of 50% , it would only cost them roughly 1.21 Trillion dollars.

    Heck, they paid more than that in 2007 in bonus to 600 executives.

    600 executives versus 9.2 million homeowners

  7. Hello again,

    Let’s be fair, according to some posters, about half of the outstanding mortgages have no reason to worry about being underwater, just about having their equity disappear.

    Lets say the half of the outstanding mortgages were taken out in the last 5 years, thru purchases or used as an ATM, roughly 6 trillion dollars.

    If we wanted to use the same 50% reduction fiqure that would equal 3 trillion dollars,

    ***a little more than one third of what the taxpayers have already extended to the banks with funds, usuage of funds or guarantees, excluding AIG and Citibank.

    But again to be fair, a homeowner who purchase or refi 5 years ago would not receive the same reduction percentage as a homeowner who purchase or refi 3 years ago. (reduction would be to the current fair market value)

    To reduce every underwater homeowner to the current value of the area, taking into consideration different areas decreases, lets average out the percentage to 40%(still high) would equal a loss of 2.4 trillion dollars to the banks and investors.

  8. All modifications and even the proposed cram downs(bankruptcy 13 changes) only affect the deliquent borrowers, if they can prove they couldn’t pay the previous mortgage payment, nothing to do with having negative equity

    I will agree that the modifications and the proposed bankruptcy 13 changes will delay the foreclosures, extending the time of the housing decline.

  9. Admin:

    According to my plan, if the above chart was correct and verified by appraised value, the principal reduction would go to $242,000.

    If the median income was %59K as stated, more than half of your neighbors would be ok, if fact they would be better than ok since the principal and interest payment would be $1299.11 at 5%.
    ( it wouldn’t matter even if their first mortgage was a 1% POA, the payment still would be lowered due to the loan amount)

    Real estate was location derived when they purchased, refinanced, or want to sell, that is why different areas of similiar type homes sell for different amounts, regardless of who WANTS to live there, it was always based on affordability.

    Loans that are current do not need to be re-underwritten unless you want to get rid of no income check loans entirely. They are already offically dead, but there are a number of them on the books that pay.

    I thought the object of your web site was to show how the banks increased the values as a result of their actions and how the values are decreasing also as a result of their actions.

    Translation–defective mortgages , think about it

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