For one sign, the Government has finally made California a higher priced state, like Hawaii and Alaska, by increasing the loan limits for "conforming" loans - those that offer lower interest rates, and somewhat easier qualifying, from the former $417,000., to $729,500.. ( They do usually require at least a 10-20% down payment on a purchase, or 20% equity left, after a refinance, so they shouldn't add to the current sub-prime mortgage mess.)

      The effect this will have remains to be seen, but one plus factor should be this: Current borrowers, paying on an adjustable rate loan that has had its payments increase considerably over its life, might be able to more easily refinance out of it, with better current rates, and much lower payments - in many cases staving off a foreclosure, and enabling them to keep their houses, rather than be forced to sell them or lose them to their current lender. This will most likely happen in the next month or two, hopefully in time to save a bunch of distressed owners, from losing their houses.

      Another positive result from all this good lending stuff now emerging, is the ability to purchase one of the presently low "good buys" that I've been talking about, before they are all snapped up.  This snapping up process has already started but there are still some excellent buys out there.  Most of them are short sales, lender repossessions, or corporate relocations.

      If this is truly the bottom of the market, as I personally see it, most of the good buys will be gone within a month or two, and then we will settle ( by this summer.)  into a fairly normal market, with buyers and sellers being more equally poised - neither having a big advantage, but FAR from the buyers market that has been in place for the past 2 years.

     To the seller's advantage, there should be fewer foreclosures, and lender owned properties to compete with.  To the buyer's advantage, there will still be a good number of houses to choose from - and play against one another - just at slightly higher prices than some properties that are currently available.

     I realize some of this "news" may be contrary to articles you're seeing in today's newspapers, or on the Internet.  Here are a couple of huge reasons why:  First, most media is reporting data that is MONTHS old - at least 2, sometimes much more.  By comparison, I am reporting based on things that are happening right now - this week, last week, etc., much more up to date.

     The second factor that helps the media misinform you is that in the vast majority of cases they are using data that is statewide or even nationally based - not the least bit relevant to South Orange County.  Do YOU care that the vast majority of California foreclosures are taking place in the Inland Empire, Stockton, or Sacramento? ( or those in Detroit, for that matter.)  Again, it isn't really relevant to what is happening locally.

      The opinions that I'm sharing with you are based on local information, from someone who has been working in this area, selling local real estate for over 31 years.  Not a stock broker in New York, perhaps jealous that housing doesn't whip-saw up and down like the stock market, or some disgruntled snow bound economist based in Minneapolis, wishing he lived HERE, instead of where he's "stuck".

       The housing market doesn't "whip-saw" like the stock market because people LIVE in their housing investments.  If they didn't, when the bad news began to hit the housing market there would have been a stampede to sell, just like what happens when people find out they own a stock like Enron, Bear Stearns, or similar "investment", that is rapidly losing value.  The majority of homeowners merely hold on to their home, riding out the storm. 

      When the dust settles ( again, probably by this summer.)  from this current housing "crisis", values in South Orange County will probably have gone down somewhere between 10 and 20% from their highs in the spring of 2005, but no where near the 40, 50, even 60% drop predicted by some experts, whether local, or national.

       I found it intriguing that in a recent Register article ( 1/27/08.)  a survey reported that 41% of respondents thought there would be higher prices in 08, and 55% predicted lower.  A similar survey just a few months ago predicted far more doom & gloom.  It seems that more and more people ( insert the word: buyers.)  are becoming convinced that the market is about to turn around, and NOT go down further, if at all.

      When I say turn around, that is not to say that prices will start going up again, or that we'll go back to a seller's market, anytime soon.  What will probably happen though, is that prices will firm up, making today's few "good buys" look like absolute steals.  I personally expect to have a fairly flat market, with a good equilibrium of buyers and sellers for the next couple of years - before prices start to go up again - which has always happened, ever since I began, 31+ years ago.

       If you, or someone you know, is sitting on the fence, waiting for the bottom to "magically" appear, I implore you to get serious.  When the bottom does come there is not going to be a bell ringing to announce it.  It will ONLY be obvious when it has long passed.  By the time the media proclaims a "bottom", it will be 2 or 3 months after the fact, and much too late, to take advantage of.

       If you look for the signs, and take what the media is saying with a huge grain of salt, it will become quite obvious and clear.  The bottom could very well be here, right now, and the good buys of today might be the lowest prices you'll ever see.  If I'm wrong, prices might go down another 4 or 5% ( Maximum! )  this year, but if I'm right, you could be in that preferred investor's position of buying low.  Only time will tell.

       If you ARE a prospective buyer, I have an exciting new program to share with you - directly from the MLS.  It's the latest method of looking for houses, with little assistance needed from your Realtor.  You can tweak parameters to your heart's content, for properties pretty much anywhere in California.  It is far better than programs you may have been using up to a month ago - like I said, it's new, improved, and easy to deal with.  If you would like to check it out, visit http://coto.listingbook.com/?node=3 to set up your own account, or drop me a line and I'll be happy to set one up for you.

       If you are thinking of buying or selling real estate in South Orange County, it would be my extreme pleasure to be at your service.  Drop me a line or give me a call.  Bob Phillips, of ReMax, at (949) 643-2100, or at BobPhillips@Remax.net.  Thanks for reading.