Stockton, California

I use to ride my bike through nearby neighborhoods and say "Thou shall not covet they neighbor's house". I wanted a house so badly. A place I could paint the walls if I wanted. Pull up the grass if I wanted. Years ago so many people told us we needed to buy and buy now. Don't wait. And it began to feel like we missed it and would never own a home of our own. When we were ready things just didn't go right.

Now I drive down the freeway and see all of those houses and sad people. Sad sad people. In homes they cannot afford. Driving hours each day just to make the payment that is late.
As this continues and prices fall ( the house across the street has come donw $70,000 from the asking price in just one month!) I begin to have more hope than I ever have had before.

This article is about Stockton a town maybe 20 mintues from where I live. I drive there for my night class. It's very sad in deed.



From YAHOO/AP News.

STOCKTON, United States (AFP) - A town in central California has become ground zero in the wave of foreclosures plaguing the US housing market in the wake of the sub-prime lending crisis.


With a population of nearly 300,000, Stockton has acquired the unfortunate distinction of having the highest foreclosure rate of any US city, with one in 27 households left counting the cost of the credit crunch, according to Realtytrac, an online marketplace for foreclosure sales.

Stockton's Weston Ranch neighborhood, a 15-year-old subdivision of modest tract homes, has the worst foreclosure rate in the area, according to ACORN, a national advocacy group for low and moderate-income families.

"It's not the CEO of Intel who lives in Weston Ranch, but the guy who details his car," Geri Taylor, broker at Weston Ranch Realty for twelve years told AFP. "They just were not prepared for this."

Adjustable rate mortgages offered to sub-prime borrowers, hopeful homeowners with shaky credit, lured families into houses with inflated prices, said Taylor.

"Many financed one hundred percent of the price, and some even financed the closing costs," she said. "They got in at a teaser rate thinking this neighborhood would be commutable and affordable, and then the rates went up."

Sign-after-sign beckon to potential buyers on the Weston Ranch streets. "American Dream Realty -- Reduced Price!" reads one placard spiked into a brown lawn.

"People are just walking away," said Taylor. "We've seen houses with food still on the table from when the sheriffs have come knocking."

Lupe Dominguez washed his car in his driveway two doors down from a shabby bungalow with a front window covered in a yellow and black poster announcing a public auction with a fifty thousand dollar starting bid.

"That house has been empty for nine months or so and the sign has been there for two," he said.

A friend who lived down the street lost his house to foreclosure and then rented a house that he had to vacate because it too was foreclosed, he said.

Gloria Johnson, another broker in the Weston Ranch area, has increased her volume of "short sales," as a method to help homeowners avoid foreclosure and wrecked credit.

In this arrangement, the borrower provides evidence of financial hardship and the lender agrees to assume a loss and sell the house below the amount owed on the mortgage.

"It is almost like begging, but I am doing everything I can to help these people maintain their dignity," she said.

Taylor too has modified her business practices, shifting her focus from home sales to rental property management, advising clients to wait out the market. She manages fifty rental homes now, properties that she hopes to sell for clients when buyer interest returns.

"There are just are no buyers out there right now," said Taylor.

Houses are sitting on the market three times as long as in 2006 and the average sale price has dropped by 10 percent, she said.

"We've got 350 homes for sale in this neighborhood right now and at this rate, that is five years of inventory," said Taylor.

"Nobody has a crystal ball, but I don't expect to see an improvement until 2010."

Potential homeowners must be better educated about the market, said Lance Hill, a housing counselor with Visionary Homebuilders, a Stockton non-profit whose goal is to extend homeownership to low-income families.

"To be mortgage ready, they need to know what adjustable rates, refinancing, and pre-payment penalties mean, and we must make sure that they have a certain education level," he said.

Stockton has had 8,000 foreclosures so far in 2007.

"Home ownership is a great thing," said Taylor, "But only if you can afford it."