Prudent Investing 101

Foreclosures Actually Dropped (If You Don't Count Five States)

A few thoughts:
1) FL, CA, AZ and NV had values outstrip incomes. They had the most room to go down due to affordability of existing population.
2) The above 4 states had a HEAVY chunk of investment $$$ chasing properties. That artificially drove up demand and everyone who wanted to be in a house went into a house during that time frame. Now we are having supply/demand equalize and it is painful....
3) The above 5 states represent a BIG chunk of total originations due to population. CA and FL are probably 15%-20% of total originations alone. Then, factor in higher property values in those states and you get a disproportionate potential exposure to bank BALANCE sheets, which is what this is really all about....Are firms properly capitalized and financially viable? Some clearly aren't.....WAMU is going to get killed as values continue to erode in CA (my 2 cents)