DataQuick: Sacramento Unsold Repo Inventory Increasing

From Bloomberg:

Home prices fell in four out of every five U.S. cities in the third quarter, a record spurred by distressed foreclosure sales across the country. The median price of a U.S. home declined 9 percent from a year earlier....

The steepest price declines were all in California. The area surrounding San Bernardino had a 39 percent fall in its median home price to $227,200. Sacramento saw a 37 percent decline to $212,000, and San Diego had a 36 percent drop to $377,300. The U.S. median is $200,500.

From CNN Money:

"We're clearly seeing a broadening, as well as a deepening of the declines," [Mike] Larson [a real estate analyst at Weiss Research] said. "That indicates we've moved past the time when price drops were fed by bursting of real estate bubbles to one in which the broad economic downturn, marked by job losses, is taking hold."

From the Sacramento Business Journal:

Homebuyers snatched up repossessed homes at an impressive clip this year, but that doesn’t mean the Sacramento region’s housing troubles are easing. That’s because lenders might be foreclosing on homes faster than they can sell them.
...
[T]he inventory of foreclosed homes isn’t dropping. The backlog of unsold repossessed homes has actually grown in the past year, to about 5,000. That number includes homes repossessed over a two-year span prior to Aug. 1 that didn’t sell by Oct. 20 (allowing a reasonable period to spruce up and market them for sale). The backlog has increased from about 3,300 at the same time last year, DataQuick said.
...
Not all repossessed homes make it quickly to market. Only about 3,100 foreclosed homes were listed for sale through MetroList as of the end of October, even though the backlog of unsold foreclosures is 5,081 homes. Those homes will eventually make their way to the market.
...
At least one national bank is looking to rent some of its repossessed homes rather than sell them. HomePointe Property Management, a Sacramento company that typically manages rental properties, just signed a contract to rent out “a handful” of foreclosed properties throughout the region.

From the Sacramento Bee (hat tip patient renter):

Sacramento County's lowest-income neighborhoods continue to take the toughest, most destabilizing punches of the region's two-year foreclosure crisis, says a new report from the Sacramento Housing and Redevelopment Agency. And it's getting worse. "Foreclosures are continuing to increase," said Joel Riphagen, SHRA redevelopment analyst.
...
Now, many of the region's lowest-income neighborhoods have seen huge spikes in sales as home prices have fallen. Investors are snapping up homes formerly occupied by owners with intent of renting them.

From the Sacramento Business Journal:

I think they [lenders] had continued to underestimate the problem up until very recently. The other part of it is, I go in with a reasonable approach. What I’m hearing from people I know at lending institutions is that the number of people asking for modifications, some sort of help, is somewhere around 80 percent of their customers, but the number of people who actually qualify for that help is closer to 30 to 35 percent.
...
Some people with a fixed-rate mortgage read about modifications being available, so they would like to see their interest rate modified downward. There’s not much the bank can do for those people.

From the CVBT:

Residents of the Central Valley are frustrated and angry that so little impact has been seen from the Wall Street bailout, says U.S. Rep. Dennis Cardoza, D-Merced, who is criticizing Treasury Secretary Henry Paulson of foot dragging.
...
Mr. Cardoza says he “reluctantly” supported the $700 billion banker bailout only after guarantees were included in the legislation that taxpayers would be protected and the foreclosure crisis would be averted.

From the CVBT:

The thousands of homes lost to foreclosure and the resulting depression of home prices are beginning to make California bit more affordable...The Sacramento region and Stanislaus County were the second- and third most-affordable metro areas in California with 59.9 percent and 59.7 percent affordability, respectively.
...
The building industry argues that today’s relatively high affordability levels are likely to be a short-lived phenomenon after the market correction is completed as underlying demographic trends point to rising prices in the future once the large supply of foreclosed homes is sold. “The increase in affordability is great news for people who are looking and who qualify to buy a home in the current market, and we definitely encourage those people to do so and take advantage of the low prices while they last,” says Robert Rivinius, CBIA’s president and CEO.

From the Sacramento Business Journal:

The rough and tumble economy did not spare Sacramento-area banks in the third quarter despite the more cautious nature of community-owned banks. Only three of 11 area banks earned more through the first three quarters of the year than they did during the same nine-month period in 2007...In the aggregate, locally based banks earned $12.9 million through the first nine months, down 52.6 percent from earnings for the same period last year.
...
In a normal market, people pay off a home-equity loan because they could otherwise lose their home. In the current market, people have already lost their home, and there is little or nothing for the bank that made the equity loan to recover.

From the Manteca Bulletin:

Closing schools to weather the deepening budget crisis is among 100 ideas being scrutinized by Manteca Unified...The double whammy of declining enrollment due to the foreclosure crisis coupled with the state's mid-year deficit projection that has ballooned to $28 billion has opened the door to such a move.

From CBS13:

No too long ago, Elk Grove was booming with growth. In fact, it was fastest growing city in the country at one time. Tonight, it's forced to pay the price for the nation's faltering economy. The city took a big hit today with another dealership closure. Customers who bought at Elk Grove Saturn came back for a tune-up today to find their dealership closed.

From the Sacramento Bee:

AAA said gas fell another penny in Sacramento on Monday to $2.24 a gallon, the cheapest it's been since May 2004...If prices hold, that translates into savings of more than $2.5 billion a month across the state. But that's more than offset by the fallout from the housing crash. So-called "equity extractions" in California – the dollars generated by home equity loans, refinancing or outright sales – have fallen by $41 billion this year, according to researcher MDA DataQuick.

Not surprisingly, Californians aren't suddenly reopening their wallets. "We're doing the same things that we did when gas was almost $5," said Marty Walter of Orangevale during a stop at a Union 76 station in Roseville on Monday. "We're getting into the pattern of saving – let's not do anything unless we have to." Cori Brown, pumping $15 worth of fuel into her 1996 Ford Explorer at a Chevron station on Richards Boulevard, feels the pinch. Until food and rent decline as much as gas, "it doesn't make a whole lot of difference," she said. "This is a depression, and I'm living through it."

Sacramento Real Estate Market - November 2008 Water Cooler

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"California's Central Valley Cities Are Faring the Worst"

From the AP:

Speculators, who swooped up between 30 and 40 percent of the homes sold [in Mountain House], have bailed in droves, leaving empty houses selling for half of what they cost two years ago.
...
The latest report from Zillow.com, a housing valuation website, found that out of 163 metropolitan areas, foreclosure-plagued Stockton, Mountain Houses's next door neighbor to the east, had the highest percentage of homes with negative equity. In Stockton, 70.5 percent of all homes bought within the last five years and 45.9 percent of all homes in the city cost more than there are worth.

Amy Bohutinsky, a spokeswoman for Zillow.com, said by whatever measure firms use, California's Central Valley cities are faring the worst, followed by southwest Florida. "I don't know what the future holds for these towns," she said. "It's a very bleak situation when you're looking at your home value having to double just to break even.

From the Sacramento Bee:

"I don't think there's anyone in the world that's been going through what we're going through now," San Diego home building industry consultant Tim Sullivan told struggling Sacramento-area home builders Tuesday. Many builders are focused on their survival in a capital-area market where bank repos rule.

From the Sacramento Bee:

The developer of the oft-delayed Elk Grove Promenade shopping mall says it's in danger of going out of business, raising fresh doubts about the Promenade. General Growth Properties Inc.'s worsening financial condition was outlined in a filing Monday with the Securities and Exchange Commission. Retail experts said they're convinced the Elk Grove mall will be opened, either by General Growth or a successor. But the opening, set for fall 2010, could well slip.
...
Though the exterior to the 1.1 million-square-foot mall is done, the opening was delayed in July by a year, to the fourth quarter of 2010, because of the weak economy. Elk Grove has been especially hard hit by the downturn in the housing market.

From the Sacramento Bee:

CalPERS disclosed a $3.2 billion decline in its housing portfolio Wednesday, the latest major setback for the big pension fund. The California Public Employees' Retirement System said an exhaustive appraisal of CalPERS-owned homes and lots across the United States revealed a 35 percent drop in value in a few short years, testament to the horrific collapse in the nation's housing market.
...
CalPERS has been investing in housing since the 1990s, the bulk of its funding came between 2004 and 2006, consultant Le Plastrier said...CalPERS' investments include the site of developer John Saca's ill-fated twin tower condominium project in downtown Sacramento. CalPERS, after spending $25 million, took over the property when the project faltered last year.

'Nobody has any proof that we’re at bottom'

From the New York Times:

This town, 59 feet above sea level, is the most underwater community in America. Because of plunging home values, almost 90 percent of homeowners here owe more on their mortgages than their houses are worth, according to figures released Monday. That is the highest percentage in the country. The average homeowner in Mountain House is “underwater,” as it is known, by $122,000.
...
Even relatively recent arrivals are feeling a pinch. Kenny Rogers, a data security specialist, moved into Mountain House last year, buying a foreclosed property on Prosperity Street for $380,000. But the decline in values has been so fierce that he too is underwater.

From the Sacramento Business Journal:

After sitting out much of the housing slump, investors such as [Ethan] Conrad lately have been drawn back to land by steep discounts as banks foreclose or homebuilders dump their holdings. Not everyone is convinced land has hit bottom, but Conrad likes the prospects. “I’ve watched values plummet by a pretty shocking amount,” said Conrad, who bought 267 lots from homebuilders William Lyon Homes and JTS Communities Inc. in the past few months, spending about $11 million on assets that cost those homebuilders $45 million. “All of the signs are of a healthy market coming back.”
...
Some real estate brokers, however, have yet to see clear signs of a recovery. Guy Spitzer is a vice president at Cornish & Carey Commercial who concentrates on land and investment properties after a career with builders Renaissance Homes, Lennar Homes and Centex Homes. He is much more cautious about the state of the market, saying it’s possible that private investors have leapt too soon because they can’t reap profits until homebuilding is profitable again. “I have been a homebuilder for 25 years; I’m the guy who had to buy those deals,” he said. “Nobody has any proof that we’re at bottom. Our country is going into recession and that’s going to cause additional pain in California — it’s just a tough, tough time.”

From the Associated Press:

From department stores and convenience chains to call centers, managers who only a year ago had to scramble to fill holiday jobs are seeing a surge in the number of seasoned applicants — many of them laid off in other sectors and desperate for a way to pay the bills.
...
David Ortega, a training store manager at the 7-Eleven in Citrus Heights, Calif., that got more than 100 applications, noted that many applicants have management experience — including those who even owned their own construction business. The store in a suburb of Sacramento, which has been hard hit by the housing slump, usually saw candidates who came straight out of high school, he said.

"This year is playing out like one of Aesop’s fables"

From the Sacramento Bee:

In a vivid example of the Wall Street financial crisis hitting home, development plans for a Placer County golf course community called Bickford Ranch crashed Friday in federal bankruptcy court. Bickford Ranch, a 1,942-acre residential project in the Sierra foothills between Penryn and Lincoln, collapsed after its sole source of cash – Wall Street investment bank Lehman Brothers – imploded in September, developers said.

From the Sacramento Business Journal:

New Faze Development Inc. had ambitious plans to build housing in Sacramento’s struggling neighborhoods, from hip, urban projects to those aimed at fixed-­income seniors, but lately the company has had struggles of its own. Three New Faze subsidiaries have filed for bankruptcy protection, actions the company says were necessary to avoid foreclosure by lenders that were unwilling to rework loans and, in some cases, unwilling to even return phone calls.

The latest New Faze company to seek protection was Alchemy at R LLC, which built a signature project of the same name on the 2600 block of R Street aimed at the trendy set looking to live in midtown. It filed a Chapter 11 petition to reorganize on Oct. 31 after lender PFF Bank & Trust sought a foreclosure sale of the eight condos and 15 apartment units. The project now sits empty even though the company found willing buyers for some of the condo units, said Terence Kilpatrick, in-house counsel for New Faze.

From the Appeal Democrat:

Yuba City may use a pot of redevelopment money to get into the real estate game by buying foreclosed homes...The City Council briefly talked about the idea at Tuesday's meeting and directed the city administration to look into it. Council members all said they favored the idea. [Kash] Gill said the city could use money to take distressed homes off the market, helping the housing market and increasing the city's stock of low-income housing. And because its a buyer's market for homes right now, the price would be right. "Right now is a perfect time, it's definitely a buyer's market," Gill said at the council meeting.

From the Manteca Bulletin:

Dori Beck [a mortgage planner with Guild Mortgage Co.] was singing the praises of the City of Manteca's first-time homebuyers program...."For some families who are lower income and working, this could be the last time they can ever afford to own their own home in Manteca," Beck said of home prices that have dropped off as much as 50 percent in some segments of the local market.

From the Sacramento Business Journal:

Beth Harrington, president of Benefit Resources Inc. in Sacramento, also has seen an increase in 401(k) hardship withdrawals. “I have two on my desk right now,” she said, referring to hardship distribution requests. “Some are people who got home equity loans, maybe three years ago, and now they have no equity in their home. Unfortunately, these people are moving their stock out into cash at the bottom of the market. This will have a tremendous impact on their retirement goals, so it’s disappointing.”

From the Sacramento Business Journal:

When times get tough, the tough go to thrift shops...“We’re just overwhelmed,” said Judy deCesare, manager of All Things Right & Relevant in Davis. “We’re taking in so much merchandise, and better quality merchandise. Things that people might have held onto, they’re giving up.”...People have been bringing in so much stuff to sell, deCesare said, that she has had to cut down the hours the store will accept merchandise.
...
People buying “Tuscan-style, cookie-cutter homes” during the housing bubble, especially people in their 20s and 30s, seemed to have an appetite for new furniture, [Scott] Schneider said...[W]ith the impacts of recession hitting home, more people are walking into...Taber Furniture...to sell pieces they bought brand-new, Schneider said. Frequently, those people are trying to recoup the price they paid when the furniture was new, and the prices they demand are too high. Schneider said he’ll advise people to try selling their wares on eBay or craigslist.org, and they’ll tell him they’ve already tried.

From the Sacramento Business Journal:

For some of Sacramento’s local banks, this year is playing out like one of Aesop’s fables. The banks that didn’t lower their standards were laughed at during the subprime lending spree. Today they are feeling perky while their party-going competitors are nursing financial hangovers.

From the Sacramento Bee:

The Sacramento City Unified School District has arrived at a threshold that other urban, slow-growth districts have crossed recently: closing schools, consolidating campuses and renting out district property. The budget crisis, built-out neighborhoods and stagnant enrollment have pushed the district to explore how to cut costs and get more out of hundreds of millions of dollars' worth of property.
...
In the past six years, San Juan Unified School District's declining enrollment has led it to close nine schools. Don Myers, San Juan's director of facilities and planning, said the suburban district is now discussing additional closures. Enrollment dropped another 1,000 students this year and Myers said the decline hasn't hit bottom.

SRRI: Sacramento Region to Lose 13,000 Jobs by September 2009

From the Sacramento Business Journal:

The Sacramento region can expect an estimated net loss of 13,000 jobs by September 2009 as the hard-hit housing market, credit crunch and low consumer confidence continue to pound the region’s economy. Analysts with the Sacramento Regional Research Institute expect the six-county region, which has already seen a net annual loss of 2,425 jobs for the year ended in September, to lose an additional 1.4 percent from October through next September, according to a report [pdf] released today...“Things have only gotten worse, and that means we expect it to get even worse in the next 12 months,” said Suzanne O’Keefe, associate professor for the department of economics at California State University Sacramento.
...
The six-county region is expected to suffer a 2 percent year-over-year loss of jobs in first-quarter 2009. By comparison, the early 1990s, at its worst point, saw a 2.1 percent year-over-year loss of jobs.

So far, SRRI's predictions have been overly optimistic.

From the Sacramento Bee:

The annual real estate forecast season is on, and Sacramento-area home builders caught a fresh earful of unfriendly predictions Thursday. The consensus of economists, consultants and home-building executives regarding 2009 is the same as they all predicted in November 2007: This numbing housing slump has a long way yet to run.
...
Folsom building industry tracker Greg Paquin had these predictions: Builders will sell 5,300 homes this year in El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties and perhaps 10 percent more next year. That's if the economy improves in the second half....New home prices – averaging $374,000 across the region – are about as low as they can go. He said, "We feel we're getting real close to the bottom in the Sacramento market."
...
This year's North State Building Industry Association forecast seemed to find builders bleaker than ever about immediate prospects. Bank repos are killing sales, and the economy is worsening. Hopes are largely pinned now on a distant future when inevitable population growth again stirs demand for what they build.

From News10:

Registrar of Voters Austin Erdman said he noticed a trend that would have an impact on the election. "It actually happened in the February election, when we got 37 tubs of information (voter guides) back from voters. We found the houses are empty," said Erdman. The number of registered voters in San Joaquin County is 268,476. In 2004, it was 276,939.

From the Sacramento Bee:

The day after Barack Obama was elected president, at least 33 more bankruptcies were filed in Sacramento. Foreclosures continued their assault on the region's housing market...[F]or all of Obama's campaign talk about using the power of the government to revive the economy, it's a near certainty that he'll be unable to reverse the downturn quickly.
...
What's clear is that the Sacramento economy won't improve meaningfully until the real estate market recovers. Obama has talked about taking steps to help homeowners, including a 90-day foreclosure moratorium and legislation to give bankruptcy judges the right to reduce the amount a debtor owes on his house.

On Wednesday, Gov. Arnold Schwarzenegger proposed a similar 90-day moratorium, plus a loan-modification program that would ensure that mortgage payments don't consume more than 38 percent of homeowners' incomes.

'In Survival Mode'

From the Sacramento Bee:

[Mike] Wood is the [Sacramento police] department's lead investigator of real estate fraud, a position created three years ago and partly funded by a county grant to deal with an influx of financial crimes that came with the boom in the real estate market. He is one of only a handful of real estate fraud detectives in Sacramento County.

With the economic downturn, new forms of fraud, scams and schemes in the real estate world have emerged, keeping Wood busy. As more homes go to foreclosure, for example, "professional squatters" move into vacated bank-owned homes, pretend to lease out the properties and abscond with renters' deposits.

From the Sacramento Bee:

Already struggling, Sacramento's commercial real estate market is getting hammered by a fresh wave of retailer bankruptcies, including Mervyns, Linens 'n Things and Shoe Pavilion...Garrick Brown, research director at commercial broker Colliers International's Sacramento division, said the vacancy rate in the region's major shopping centers rose to 8.8 percent in the third quarter, up from 7.6 percent in the second quarter. It was 6.7 percent in the first quarter. By the first quarter of 2009, when Mervyns closures and others take effect, the vacancy rate will top 10 percent, he said.
...
"Mervyns' demise quickens the shakeout in the Sacramento retail property market and, in the short term, creates a little panic for landlords and tenants," said Heath Kastner, a vice president with commercial broker CB Richard Ellis. "The Sacramento area right now is in a tough spot for retail. A lot more people are closing their doors compared to new businesses opening."

From the Sacramento Bee:

The meltdown finally finished off the Melting Pot in Rocklin. The 3-year-old fondue restaurant on Lonetree Boulevard in Rocklin opens at 4 p.m. today for the last time after more than a year of fighting declining sales and dwindling crowds. "I've done everything I could. I've looked at all the options," owner Mike Frampton said earlier this week. "But the last two months were just too much." His restaurant's demise is a window into how recent wild swings on Wall Street and the credit crunch have pinched retailers and restaurants: Nervous customers spend less. Nervous banks lend less.
...
[Frampton] open[ed] his restaurant in November 2005. The region was booming. In December of that year, the median price of an existing home peaked at about $505,000 in Rocklin's two ZIP codes, according to real estate researcher MDA DataQuick. Last month's median price: $325,000.
...
Frampton saw much of it coming, "although I didn't realize how bad things would be – I don't think anybody did," he said.

From the Sacramento Business Journal:

The local Small Business Administration district and nearly 100 lenders are still making loans, but fewer people are seeking them, said Jim O’Neal, district administrator of the Sacramento SBA office. After years of breaking records for the number of loans made, the Sacramento SBA office approved only 912 loans in the year ended Sept. 30 — a decrease of 37.5 percent from the record 1,460 loans made the previous year...“It is easy to say the bankers are not lending, but the businesses are not seeking money either. Their customer base has shrunk, and they are being cautious,” O’Neal said.

From the Sacramento Business Journal:

For years, Inter Flora kept so busy selling its artificial plants for homebuilders’ model homes that its owners had little time to cultivate other types of customers. Then came the housing bust, and nearly the bust of the two-decades-old wholesaler. The new owner of the now-leaner Rancho Cordova company is reinventing Inter Flora and himself, and vows never to depend on homebuilders or any other single type of customer.

From the Stockton Record:

"We've had more transactions through September this year than I've had in the prior 10 years," said Jerry Abbott, president and co-owner of Grupe Real Estate, Stockton. "We're having a boom year, but the prices are 60 percent or less what they were at the peak of the market" several years ago...San Joaquin County's median sales price slid...41%...declining from $325,000 a year ago to $192,000 last month, TrendGraphix reported.

From Reuters:

Last week, Wachovia Corp said borrowers with its "Pick-a-Pay" ARMs and living in or near Stockton and Merced, California, owed at least 55 percent more on their mortgages, on average, than their homes were worth.

From the Modesto Bee:

During the first nine months of this year, Stanislaus County issued 408 new home building permits. Compare that with the 3,670 permits issued during the first nine months of 2005, according to Construction Industry Research Board statistics. That's an 89 percent decline in new home construction. "There's so few of us builders left," said [Modesto home builder Mark] Wilbur, estimating that about five locally owned companies still build subdivisions in Stanislaus County. "We're just in survival mode now. We're not going to be profitable for another couple of years or so."

From the Press-Telegram:

Rep. Laura Richardson provided documentation Friday showing that she is up to date on the previously delinquent home loans that earned her national attention over the summer. "What I wanted to show you is everything is currently in order and has been resolved," Richardson said during a meeting with a reporter and editor at the Press-Telegram.
...
As for the Sacramento home, she said she plans to list it for sale or rent in December.

From CNBC:

[N]o matter how far we go in modifying, restructuring, writing down principal on loans in order to stop foreclosures, the bottom line is that most of the borrowers in trouble had no business being in the homes they bought in the first place. You can modify their loans for five years, but they will probably lose the home anyway.

Is that mean? It’s not meant to be. I just think that in order to set the market right we need to let prices fall to where they must and start over again with mortgages, buyers and homes that make sense. We’re all losing money here, but that’s because so many people took advantage of free money during the housing boom (and don’t get me started on how those who didn’t take advantage of that free money still get screwed). I understand the need to restore the credit markets and stop the crash in housing, but keeping folks in homes that are way beyond their means is just prolonging the pain of the inevitable.

From the Wall Street Journal:

Just as in the 1930s, there is no evidence that the policy makers have any understanding of what they are doing. They need to make way for the natural forces of repair. They need to let housing prices fall. They need to let firms go bankrupt. They need to let firms that are healthy thrive. They need to let healthy firms buy the sick firms. It is time to let the imprudent fail and the prudent pick up the bargains.

A recession is coming (or has already arrived) no matter what happens in Washington. The question is whether the attempt to forestall it is going to make it worse and turn it into another Great Depression. By acting without rhyme or reason, politicians have destroyed the rules of the game. There is no reason to invest, no reason to take risk, no reason to be prudent, no reason to look for buyers if your firm is failing. Everything is up in the air and as a result, the only prudent policy is to wait and see what the government will do next.

Bee: Sacramento Real Estate Market Bottoming Out?

From the Sacramento Bee:

Is Sacramento's woeful housing market bottoming out?..."We might be hitting that bottom … but we might be at that bottom for a while," said Dean Werhli, a vice president in the Elk Grove office of market researcher Sullivan Group Real Estate Advisors. "We could be skidding along this bottom for quite some time."...Even if the economy worsens, "it's going to be difficult for prices to go much lower," he said.
...
Consumer advocate Paul Leonard offered a bleaker prognosis: The foreclosure crisis could worsen over the next year, and the state's faltering economy won't help. "It's certainly good to see that there is new (sales) activity, but there are still a number of factors out there that suggest that this problem is going to be with us for a while statewide, particularly if you look at the Central Valley," said Leonard, director of the California office of the Center for Responsible Lending.
...
The region's economy has a lot riding on this. The bursting of the housing bubble caused considerable harm to the economy in Sacramento and across the state. As home values plunged, equity "extractions" – cash generated by refinancing, home equity loans or outright sales – fell by 34 percent last year in Sacramento, according to MDA DataQuick. That took $2.1 billion out of the region's economy.

From the Sacramento State Hornet:

As the effects of the housing crisis and the international economic crisis ripple through everyday life, students and faculty at Sacramento State are forced to change lifestyles. For some, this means driving less; for others, the changes are more severe. Many students are finding they have to spend less to survive these days. Matthew Harris, undeclared freshman, said his spending habits have changed recently. "I don't spend money at all anymore," Harris said. "The only things I spend money on are school and food, and only when necessary."...Harris said he feels it is likely the U.S. will enter into a depression in the near future. [Student Anthony] Gragg said he feels the country is not quite to the point of worrying about a depression, but it is getting close.
...
[Kristin] Van Gaasbeck [associate professor of economics] said many professors are likely being affected heavily by the burst of the housing bubble. "Many instructors were recently hired at Sac State, and many, myself included, probably bought homes in the area during the housing run-up," Van Gaasbeck said. "I suspect that some of them are in a better boat than others, but depending on how much they were gambling on property values increasing, they might get stuck."

From the Tracy Press:

What developers had hoped would be the first retail-office-industrial anchor in Mountain House has folded under the weight of a foreclosure-saturated housing market and the national credit crisis. Chapter 11 bankruptcy of Pegasus MH Ventures I LLC forced parent company Pegasus Development to cancel plans to build a business park on 140 acres of land along Interstate 580 and near the Alameda, Contra Costa and San Joaquin county lines.

From the Sacramento News & Review:

In Folsom, home of the prison, the factory outlets and the historic downtown, the local economy will be the incoming city council’s No. 1 priority. As the election approaches, evidence of the downturn is everywhere you go in this city of 70,000 people just east of Sacramento. Reality is setting in, and it’s looking grim.

The number of foreclosed homes is growing, and property-tax revenues are shrinking. Several commercial areas in town continue to thrive, but elsewhere businesses have disappeared, leaving gaping holes in silent strip malls. Vast swaths of new commercial development lie vacant. The housing bubble has burst, the boom is over, yet the ideal of perpetual growth lives on. An enormous new shopping center continues to rise north of Highway 50. Plans for residential and commercial development south of the highway are proceeding...The city faces its bleakest budget crisis in years, and the city council will have to figure out how to fill all those empty businesses and homes....