Here in CT the large houses that were expencive have lost their value the most but houses in my neighbourhood have stayed constant. Most of us have been putting money in our homes.... Replacing windows, roofs, adding/extending rooms & such.
My region has seen huge declines in property values, but they were incredibly, artificially inflated. In large part due to Bay Area buyers buying 2nd, vacation homes with adjustible rate mortgages. In the Bay Area a 300K house was nothing. So the same house, with land
I'm in the Greater Vancouver area and we are still in a bubble. Someone did up a powerpoint presentation that was going around email saying "spot the crackhouse"...and it was 1M homes intermixed with crackhouses. I missed quite a few!
I live 20 mins from Vancouver but it's not much better here. DH and I had $500K to spend on a home and all we could afford was a townhouse. That was in 2006, now we could probably get a really old fixer-upper but it's still too high for wages. I am wondering how folks are affording these homes! I worked 3 jobs throughout my 20s and it still took some lucky picks in investments to get us here...
What pops the bubble though? If it's survived this long, there has to be that needle/prick to pop it...what would that be? High gas prices reducing household budgets? Increased unemployment from reduced exports?
I don't know if Vancouver has ARm's, adjustible rate mortgages. But that is part of what popped our bubble. People would get into more house than they could afford, with an ARM. They would get a low fixed interest the first 3, 5 or 7 years, with the idea that they would refinance before it adjastible, but things didn't happen as planned. They would be living in a 300K house, making $750 a month payments, then the payments would adjust to double or triple that. Then someone would lose a job, they couldn't qualify for refi at a fixed rate..... they couldn't afford their 3K a month payments, foreclosures and shortsales began.......