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Bakersfieldbubble - > Bakersfieldbubble -> BAKERSFIELD BUBBLE MARKET CALL - The bottom is in!
BAKERSFIELD BUBBLE MARKET CALL - The bottom is in!

Former housing bubble BEAR and the man (ME) whole predicted this financial mess says the following:

I am officially calling a bottom in the local housing market and saying its a good time to buy a house, IF  you can afford the payments (no more than 30% of monthly income), put down at least 10%, have good credit to afford a low FIXED RATE interest loan and have 6 months of cash reserves (to cushion the blow of the unexpected, job loss, medical bills, etc..).

Will the house prices continue to drop...probably another 5-10%. But if you put down 10% you will be able to cushion the blow.

Right now median house prices are less than 2.7 times median income..during the boom we were at 8.1 times, clearly unsustainable.

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posted by Bakersfieldbubble on Wednesday, May 6, 2009 at 08:11 AM
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posted by jfrancais on May 6, 2009 at 04:55 PM

BB, you seem to be the local subject matter expert.  Your predictions were way more reliable than what was on MSNBC in 2006/07.  Kudos to you for knowing your trade (I'm assuming you're in real estate).

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posted by donmason on May 6, 2009 at 04:51 PM

Hi BB,

 Thanks for the post.  I noticed you left a new post on your BB blog.  A lot of us have missed your insight and commentary.

Please continue when you have the time to spare. 

My sincere thanks for your efforts.

You always got it right.

 

Regards,

Lone Ranger   ; )

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posted by Bakersfieldbubble on May 6, 2009 at 08:56 AM

I will admit I dont see market prices going up. Also, anyone buying for appreciation will be very dissappointed.

The other metric I look at is the rental equivalent...we are near 109 (115k median to 1050 rental)...we were near 275 during the peak.

I will also agree that job losses will continue and I will also agree that there are 10+ years of "paper lots" ready to build on...both of these will put a lid on prices for a quite a while.

One other thing I am looking at is price per square foot, has reverted back to its long-term trend line:

http://www.kerndata.com/ind...

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posted by randomfactor on May 6, 2009 at 08:52 AM

I suspect we haven't seen the bottom yet locally.  But I'm not in the "biz."

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posted by witbee on May 6, 2009 at 08:50 AM

I hope you are right.

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