Westsiders Feeling Pinched by Dropping Prices - NBC Southern California

Westsiders Feeling Pinched by Dropping Prices

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    The luxury home market is sinking.

    Today's LA Times looks at Westside real estate prices, comparing home prices in Beverly Hills, Santa Monica, Venice, Culver City, Malibu, and other Westside neighbors and discovers that home prices dropped anywhere from 11.7 percent to 27.5 percent in the fourth quarter of 2008 compared to the fourth quarter of 2007. (Brentwood and Malibu both saw gains, but both neighborhoods have dropped significantly from their peak.) As an example of the falling Westisde, the Times uses the case of Shelley Conn, who listed her Santa Monica house for $2.3 million, but was forced to drop the price to $1.9 million. Oh, the horror. More via the paper:

    Though few seemed to remember it even last year, the Westside has suffered in previous real estate downturns. At the peak of the 1980s housing boom, for example, the Santa Monica house that the Conns recently sold went for $920,000. But in 1993, it sold for $600,000 -- a 35% drop. The Conns bought it for $825,000 in 1997, still 10% below its 1989 price.

    And while one expert tells the Times that the Westside is less sensitive to mortgage issues, it's worth pointing out today's Wall Street Journal story on the rising delinquency rates for jumbo mortgages, which suggests that "mortgages taken out by the affluent and wealthy, or at least the aspiring or former wealthy, are deteriorating at a faster rate." Asks the Wall Street Journal: "What if the high end actually does worse than the rest of the market?"

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