and of course, the least desirable spots are getting hit hardest, just like everywhere else in the country.

my point was that even in “middle class” areas like Mountain View, the “blue collar” engineers rolled around w/ a million plus in the bank, and were still very middle class.

in other words, this is not your average place, nor your average wealth destruction.

still, the most beautiful place to live in N. America. lucky you.

During the housing boom, builders started to build further and further out and people were entering lotteries to buy.

One of my friends lives in a 4000ft square box that looks exactly like all the other 4000ft boxes in his neighborhood (except his actually has someone living in it), miles from anywhere and was on the market for over a year without a single visitor. Gas prices were blamed at the time – “who wants to live 30 miles away from civilisation when gas is over 4 bucks a gallon?” – but gas coming down doesn’t seem to have helped. In the meantime, the house across the road from us just sold after 3 weeks on the market for 14% less then it was purchased for in 2005. 14% loss on a house is hardly a reason to celebrate, but relative to the rest of the market it held in well.

The house we bought in 2000 doubled and we sold in 2005 to buy our current house. Overall, it’s a wash and the amount we are “underwater” in this house is about the same as the profit on the hold house. It *really* sucks for first time buyers, but what the hell are first time buyers doing in 600k houses? I have no mortgage, but apparently I’m going to be helping a lot of other folks pay theirs. In the meantime, I drive a camry with 110k miles on it while the underwater houses have HELOC financed hummers and escalades parked outside. Go figure.

Underwater, anyone who bought in the last 12-18 months. I know my neighbor is at least a $100,000 under water on his mortgage, he moved in at the peak (job relocation), most of us on the street have been here awhile and are in no trouble. But if I had to guess 10% of the houses changed hands in those 12-18 months.

I am not trying to make a judgment on these areas.

The general point is that the more well-to-do areas are doing best and gradually as you move down the desirability scale there is a greater percentage of homes under water. The 40-60 areas are places that most do not want to live but choose to as the housing market ran away from them. It is not that they are not nice areas, some are okay but that they are suburban tract homes, chain stores, the same as any other cookie cutter community anywhere in the US. If you want that life then move somewhere that home prices are reasonable, it always seemed pointless to pay Bay Area prices and live somewhere that is indistinguishable from suburban Texas (I lived there).

40-60 = Solano County (BFE), Santa Rosa (BFE – this is not the Bay Area), and the strip mall, car lot areas of Hayward Union City and then Pittsburgh and Antioch (BFE & Industrial)

30-40 = Overbuilt areas of Contra Costa, some very, very nice but massively overbuilt mainly between Pleasanton and Livermore. Some areas around Santa Rosa (BFE), and the last resort areas of the East Bay, such as Oakland (not the hills), San Leandro, Hayward and Union City.

20-30 = Slightly better areas but still decidely blue collar (in the traditional sense). Less desirable areas Richmond (Murder Capital), San Pablo (Refineries), Daly City, San Bruno (Airport), Martinez, Concord, Redwood City and the overbuilt areas of Napa and Sonoma.

10-20 = These are all the middle-class to upper middles class areas, high desirable areas but not in the City: Walnut Creek, Danville, City of Alameda, Lafayette, San Ramon, Los Gatos, San Rafeal.

0-10 = High End areas: San Francisco better neighborhoods, Berkeley Hills, Orinda, Piedmont, Los Altos, Hillsbourgh, Marin, Palo Alto, elite areas of Napa and Sonoma.