Currently, there are nearly double the number of homes for sale then there were three years ago at the height of the market. And that does not include the new homes available. Supply and demand is going crazy and not in a good way. Obviously, when supply is up and demand is low, then prices drop accordingly. And that’s what we see in the Riverside, Corona, Moreno Valley and the rest of the Inland Empire.
Experts believe foreclosures are expected to increase at least 25% this coming year. Add to this the continued tightening of requirements for qualifying for a loan and we just might see the supply skyrocket and demand plummet.
As the economy continues to stumble, there are several factors affecting us. The writers strike is costing the California economy $5 million dollars a day, the dollar’s value is decreasing and oil prices are increasing. But looming in the near future could be yet another overlooked danger: the labor market meltdown. The current labor forecasts are somewhat bleak, however, if they weaken even more, many more workers than originally expected may find themselves without a job. This might force even more homes onto the market for sale, leading to an even bigger price decline.
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