So Cal Real Estate News

Pragmatists in the Bush Administration may be gaining the upper hand, according to “Bush Readies Mortgage Aid Plan,” in Saturday’s Washington Post.

According to the article, “The Bush administration is finalizing details of a plan to rescue thousands of homeowners at risk of foreclosure by helping them refinance into more affordable mortgages backed by public funds.”

The proposal targets at least some of America’s estimated 9 million “upside down” homeowners. Under the plan, the FHA “would encourage lenders to forgive a portion of those loans and issue new, smaller mortgages in exchange for the financial backing of the federal government,” according to the article.

This appears to be a modification of a proposal by Massachusetts Democrat Barney Frank, reminding us all that politics, indeed, does “make strange bedfellows.” (I’m available, Mr. Letterman. )

We think it could be a major step in the right direction–or a major disaster. As always, “the devil is in the details.” We just hope & pray that our employees in Washington (yup–we pay their salaries!) will finally put special interests, dogma, and party politics aside long enough to work for the common good.

In the meantime, if nothing else, it’s one more illustration of what we wrote last November in “How Low Will Prices Go?”–we’re in uncharted territory this time, and nobody really knows what will happen next! (If you predicted a Barney Frank/George Bush recovery plan, please let me know so I can get your input on my stocks & the Final Four next weekend!)

We’ve been getting some new visitors to our site recently, so please allow us to briefly reintroduce ourselves, to offer some insights into how we’re organized, and to ask for some help from our readers.

Who We Are

I’m Dave Emerson, the lead writer here, & I’ve lived in Southern California since I was born in L.A. in 1950. My wife and I started bought our first home in Lakewood in 1976, I became a Realtor in 1980 and a licensed broker in 1982. About that time we also bought our first rental, I started writing a real estate newsletter and I began teaching real estate classes for buyers, sellers, and investors.

My colleague, Blair Newman, is also an experienced Realtor and educator. He represents the younger generation. We have both won numerous awards over the year, and we share five “Agent of the Year” awards between us. Our goal on this blog is to give you a front-row view of what we see going on in the Southern California real estate “trenches” right now. We also try to link to and/or pass on information we find helpful or interesting, to respond to your comments or suggestions, and to give our perspective on what’s going on & what’s coming next.

Help Wanted

Our “challenge” (we never have “problems” in the real estate business) is that we know a whole lot more about real estate than I do about blogging. I’ve been deeply involved in real estate for over 30 years, and marginally involved in blogging for all of 4 months.

Hopefully that’s a good thing, because you came here to get helpful info on real estate, not on blogging. But if you know more about blogging than I do (and you probably do), then you’ll probably notice a lot of things I could be doing better. Please don’t hesitate to post questions, comments about how to do this better, suggested topics or links. . . or to tell others about our site. We appreciate your help, and respond here to every comment posted.

Getting Around Our Blog

This blog’s been up and running since last October, and we’ve gotten up a fair number of posts in that time. To help you find what might most interest you, we’ve got several “widgets” on the sidebar to your right.

At the top, we have a list of seven categories to help you find what you may be looking for quickly. Click on a category that interests you, and this left hand main column will change to display all the posts under that category, in chronological order.

Below Categories we’ve listed our five most recent posts in chronological order–just click to go directly to that post. Our “Front Page” (click upper left corner to get there, if you aren’t already) displays all our posts in chronologial order in the main, left column, so if you’re there you can also scroll down if you prefer.

Below the most recent you’ll find a list of top posts, the ones currently getting the most views.

Below that our archives widget lets you go back to any specific month, and below that we’ll be posting links to some of our favorite real estate blogs on our blogroll.

In 35 years of tracking the Southern California real estate market, I’ve never seen anything remotely like the mess we’re in right now. . . but the basic causes are as old as humanity.

Greed, stupidity, and a lack of integrity got us into this mess. But we’re not talking your average, run-of-the-mill greed or stupidity. We’re talking greed and stupidity on a scale unseen since. . . the late 1920s?

Like the rest of our blog, this isn’t the researched opinion of some economist in New York, but the personal perspective of an agent who watched this whole mess unfold from the So Cal real estate trenches.

We could start all the way back with Moses, who laid down some pretty straightforward rules that would have avoided the whole mess (See “Moses’ 10 Rules for Success“) But for time’s sake we’ll start where the last boom went bust back in 1991, which eventually led to another boom, . . .

A Boom that Lasted Way too Long

We’d just finished another furious run-up in prices, fueled by multiple offers and overbidding after a rough downturn (sound familiar?) Then the end of the Cold War led to massive layoffs in our So Cal defense industries, which rippled into the construction business and then through the whole economy.

If you’re over 30, you probably remember the stories of all the U-Haul trucks leaving the state as homeowners and renters followed the jobs across the country. 1991 – 95 were four dramatic years of price and sales declines, a classic overcorrection fed by a massive local recession. In the real estate business, the cry was “stay alive ’til ’95!” A few of us did. Barely.

In 1995 prices and sales finally started moving upwards again. By September 10, 2001, it looked like we were peaking & due for another correction. Things changed the next day.

Alan Greenspan took action to avert a post-9/11 depression, dramatically lowering short term rates. The long term bond markets, sensing a recession, cooperated & long term rates dropped too. Then the Fed dropped rates again. And again. And again. The real estate market cooperated & just kept moving up. And up. And up.

Late in 2002 Greenspan figured out things had gone too far, and belatedly began raising short-term rates. The long term bond markets, sensing that would cause a recession, failed to cooperate, and kept long-term rates low. Even lowered them a bit. Greenspan suddenly discovered the brakes on his economic sports car weren’t working!

So a correction that should have started in 2001 was put off even more. Eventually the brakes kicked in and real estate started slowing. Prices actually started dropping in the summer of 2004.

But then, for some unknown reason, prices began moving up dramatically in the spring of 2005. Every local economist except for Gary Watts was confounded. Cal State Fullerton’s annual negative Economics Forecast was beginning to look like a broken clock. (Just like a broken clock, it would eventually be right.) And more and more people forgot all about economic cycles and started believing that So Cal real estate really does only go up.

Insane New Mortgage Products

The unknown reason, it turned out, had a lot to do with creative new mortgage products. Creativity can be good, but creativity fueled by greed and aided by stupidity can–and did–create a monster.

Here are some of the parts that went into that monster:

No down: It used to be the only way to get 100% financing was to join the Armed Services or buy Robert Allen’s book, Nothing Down. Then someone figured out that a 13% mortgage for 20% of a home’s value could be “piggybacked” onto a more normal 80% mortgage to allow financing for a purchase with no down payment.

No mortgage insurance: These “piggyback” loans avoided loan review by those darned underwriters at the Private Mortgage Insurance companies by charging a higher interest rate and “self insuring.” But those PMI companies were the ones who kept everybody honest, because they were on the line if the loan went bad.
No documentation: It used to be you had to document your income to get a loan. If you were self employed, that meant tax returns. Which didn’t always tell the full story. So World Savings (I so miss all the old So Cal based S & Ls!!!!) (Pause for a moment of silence for World, Great Western, Cal Fed, Glendale Fed, Home Savings, & any others I forgot. If your old enough, picture those GW commercials with a cowboy riding past El Capitan as John Wayne intoned, “We’ll always be there.”)

Sob. OK, as I was saying, World Savings decided to allow self-employed borrowers with good credit scores and verifiable 20% down payments to get mortgages without documenting their income. “No doc” loans.

Lousy credit’s OK: Well, before you knew it, So Cal mortgage brokers like New Century and Argent were combining “no doc” loans with no down “piggybacks.” Then they decided you didn’t even need good credit scores if you would take a high enough interest rate, which won’t kick in for a year or two. All this after the market should have peaked.

Greedy rookie agents & brokers: At the same time two more trends appeared. The money was so good, everybody and her gardener went out and got a real estate license, which is way easier than getting a beautician’s license. (Some of them even got a broker’s license, because our beloved, “Blow Up the Boxes” governor vetoed a law that would have required real estate brokers to have two years experience as salespeople before getting a license.)

Disclosure about rookies: I don’t hate rookies. I was one once. Long ago, in a galaxy far away. . . .

Both new and experienced agents can be unethical and incompetent. But time does tend to weed out a lot of the worst agents. In a normal market, up to 90% of the newbies are out of the business within two years. In a booming market, they tend to hang around longer. And anyone who got into the business after 1995 did not experience the last big downturn. Some of them actually believed that “real estate never goes down.”

Agent/lenders: Lots of these brand new, do-anything-for-a-buck agents & brokers decided to double their money by acting as their buyers’ Realtor and mortgage broker. So the buyer didn’t have a Realtor looking over the lender’s shoulder, because the agent was the lender.

Bribes for selling bad loans: Interest rates were still low, and lots of people were excited to earn as much as 13% interest on these new “mortgage backed securites.” The investment banks like Bear Stearns that bundled and resold them couldn’t get enough of them. So they started giving bonuses to the brokers and agents for putting their clients into these loans–the higher the rate, the bigger the bonus. My boss says these Wall Street firms were the “pimps” of the whole operation.

Low “teaser” interest rates: Of course, those loans were advertised with their initial “teaser” rates as low as 1.9%. And the ad usually proclaimed “payment fixed for 3 years!” And nobody tried to undo the intended deception that confused fixed payments with fixed rates.

Ineffective or nonexistent disclosures: Of course, all this nonsense–even the negative amortization–was “clearly” explained someplace on the dozens of documents the buyer signed at closing. Whether the buyer spoke English or not. Oh, did I mention that it turns out that these newly minted agents often took the liberty of signing for their clients?

A culture of dishonesty. Unfortunately, lying is pretty much accepted as part of the business by many agents, lenders, sellers, and buyers. Actually, by our society as a whole. Nothing wrong with lying, as long as you don’t get caught, and the “good guys” don’t get hurt. Buyers lie to the lender about their income. Agents lie to the buyers about prices going up forever. Lenders lie to the buyers about the effects of the loan–or at least they neglect to tell the buyer. Investment buyers lie to their investors about the quality of the mortgage-backed security.

Actually, Moses told us not to do this. Over 3,000 years ago he laid down ten simple, straightforward rules for successful living. One of them was, “Don’t lie.” Of course, we’re such a smart, tolerant society that we stopped teaching that rule in public schools over 40 years ago. Too bad. A few moral absolutes would have prevented all this. Moses told us so.

Naive, trusting, desperate buyers: Not necessarily stupid, but unsophisticated. I think of Steve, an independent contractor for JPL who bought near the peak using 100%, no doc financing. We recently completed a “short sale” for him, where his lender absorbed a loss of over $100,000 so we could close the escrow. He simply couldn’t make the payments, which turned out to be $1,000 a month more than his lender/agent promised when he bought the home. “We just trusted her,” he told us.

Government Incompetance: Gee–who’da thunk! From Democrats who over-regulate to Republicans who under-regulate, to a Federal Reserve that drives the economy like my mom drove her car (slam on the accelerator–slam on the brake–slam on the accelerator. . .) nobody in D.C. seemed to be able to get anything right. For some excellent examples, check out SeekingAlfalfa’s excellent comment #1 below.

Let’s review: No down, no verification of income, bad credit, overvalued market, insane belief that real estate will never go down, desperate, naive buyers, brand new agents who got into it for the money acting as Realtor and lender both–and getting bonuses based on how bad the loan was for the borrower, non-English speaking buyers signing disclosure documents in English, everybody thinking it was OK to lie, incompetent government . . .

As my colleague and fellow Realtor Anthony Turner put it, “Any homeless bum could get a loan and buy a house.” And why wouldn’t he–especially if his 22-year-old Realtor cousin knew she’d make up to $20,000 if she sold him a loan & a home? Anybody see any problems with all this??

The Profitability of (Willful?) Ignorance

Jim T., a friend who’s been in the business even longer than me, did. At the time he was a wholesale rep for one of the big lenders. He tells me of pointing all this our to a rich young V.P. in his firm, who had no memory of the 1990′s crash because he was in 3rd grade then. “Relax, Jim,” Mr. V.P. said, “nobody’s ever lost a penny on any of these loans.”

He was right. Then. Because prices were going up faster than the negative amortization, so the houses were either sold for a profit or refinanced.

The biggest pyramid scheme since Social Security. another sad story that’s will eventually to unwind. (The N.Y. Times had an interesting page last year about mortgage backed securities, “Housing Busts and Hedge Fund Meltdowns: A Spectator’s Guide.”)

As long as everybody was making money, everybody had a financial incentive to be stupid. And ignorant.

And everybody in the food change was making money. The flipper or refinancing buyer. The real estate & mortgage salesperson(s). The real estate and mortgage brokers, who were supposed to supervise & train the salespersons. The loan underwriters. The Wall Street Bankers who packaged & sold the loans. Everyone who bought the 13% loans, from Deutschebank to little old ladies. Even the politicians, who bragged about the great increases in home ownership.

Conclusion

Greed, stupidity and dishonesty. A lethal combination. And, unfortunately, a natural product of our materialistic, me-first, live-for-today mentality.

There is a cure. Unfortunately, it’s often ignored. Even those who pay tribute to it often don’t practice it. (warning: the next paragraph could be construed as “religious”–feel free to skip it if you wish.)

Jesus expressed it as well as anyone: “Do unto others what you would have them do unto you.” “Love your neighbor as yourself.” Just treat others the way you’d want to be treated.

This is actually a real estate concept as well: The agent is supposed to be a fiduciary. That means she is to put the client’s interest above her own.

A little Golden Rule or fiduciary-mindedness at any step of the food chain might have kept us out of this mess. But right now we’re right in the middle of it.

For our thoughts on what’s ahead, check out our latest projections post, So Cal home price bottom near? as well as  what you might want to do about it.)

And, next time somebody wants ahead of you on the freeway, wave them in. Put them before your own needs. One small gesture for a man. One giant leap for mankind.

This one seemed to fly under the radar of most media, but C.A.R’s Chief Economist recently revised her 2008 projections from the figures released in Anaheim last October.

Total sales statewide were revised down a modest half a percent to 332,100, but her projected CA decline in the median price for a single family home was increased a whopping 50%, to a 9%! Leslie Appleton-Young also now projects that units sold will bottom this year, but with only modest improvement in 2009. Apparently her jury’s still out on when prices will hit bottom.

We like Leslie & have followed her reports for years, but you have to remember who pays her salary. Last October we indicated that it would most likely be worse than she predicted. Unfortunately, we were right then, & she’s still probably still a bit too optimistic.

Click here for The Register’s summary of Leslie’s recent remarks, and
here for a PDF version of the original, October report. Our most recent projections are here, and our thoughts on who should be buying or selling now haven’t changed from what we wrote in December, a classic piece on balancing market timing with your personal situation, even if we do say so ourselves.

Update added 4/7: Lots has happened since we wrote this post about two weeks ago, but it hasn’t resulted in any major changes to our projections. We did, however, release an updated projections post over the weekend: “A Change in Our Projections?”

The roller-coaster ride continues with this morning’s news:

1. Nationwide February resale closing numbers from the National Association of Realtors mirror DataQuick’s So Cal Numbers from last week: Sales up, prices down.

Why the sales increase “caught economists by surprise” is completely beyond us. January closings were the lowest on record, homes that went into escrow during the Thanksgiving to Christmas slowdown in a terrible year. They had nowhere to go but up as we move into spring.

We’ve been predicting the increase since we saw sales picking up in our market in January, & we also think March will reflect an additional increase in sales and possibly at least some firming of prices, maybe increases.

You read it here first–which is our goal, bringing you Los Angeles and Orange County real estate news from the front lines– not the ivory towers! Click for Blomberg’s reporting of NAR’s data.

2. Bear Stearns’ bad loans apparently weren’t as bad as originally thought, since Morgan-Chase this morning quintupled their bid from $2 per share to $10. Maybe things aren’t as bad as they seem? (Click here for our take on how we got into this mortgage mess & on Bear Stearns’ culpability.)

3. Stocks are up. But so are foreclosures. (For some insights into buying foreclosures, click here for our initial “Foreclosure Tips” post.)

This is just more evidence to us that we were right when we said last November that this downturn was wildly unpredictable. But we also told you What to do When Nobody Knows What’s Next.

Sellers, you may also want to review our summary of our workshop on “How to Sell Your So Cal Home for Top Dollar in 30 Days.”

That said, if you’re still intent on market timing to the exclusion of all else (that is, you don’t have a life?) we continue to expect a window of opportunity for sellers for the next several months, followed by opportunities for buyers through this winter. We still think there’s a significant chance (20%?) of a major price collapse of an additional 15 – 25% , but there’s also a possibility that the worst is behind us.

Sorry the picture isn’t clearer, but we’d rather tell you the truth than make something up. Feel free to post your comments, thoughts or questions, we try to respond to every one. Or call us if you want to talk further (562.430.0262).

Added 4/3: If you want to read excerpts from Ben Bernanke’s April 2 testimony to Congress about where he thinks we’re at and where we’re headed, check out “Bernanke Predicts Bottom Later this Year?!“

We even translated some of his remarks into English, for those of us who don’t speak economist. He pretty much agrees with us, except he’s a little more optimistic. But we think that’s part of his job. Being moderately optimistic, that is, not agreeing with us.

4/7: For our updated projections post, check out “A Change in Our Projections?

The federal government today took another step to help ease the housing requirement, reducing required cash cushions Fannie Mae and Freddie Mac by a third. That frees up over six billion dollars for them to make additional mortgages, which obviously helps real estate nationwide. Unfortunately, it also reduces the cushion they have when they might need it most (click for brief summary).

If it works, however, the need for that cushion might be reduced. To us, it’s more evidence that the decision makers in Washington are doing all they can to stabilize the real estate market. It may extend the spring mini-boom we’ve speculated about here in Southern California. It also might make this spring a good time for refinancing. Every little bit helps!

Today another chaotic day on the world’s various “Wall Streets” coincided with mop-up operations for me on a six unit apartment building. By the end of the day I was reminded that the basics work in any market.

As Solomon put it 3,000 years ago, “Be sure to know the condition of your flocks, give careful attention to your herds; for riches do not endure forever. . . .” (Proverbs 27.23-24).

Or, in my case, to the condition of your fire extinguishers. Today I figured out that my procrastinating on some fire prevention upgrades on this building may have contributed to the loss of four of the units and to making five families temporarily homeless. Fortunately, there were no serious injuries.

As I walked through the rubble with the insurance adjuster this morning, what saddened me most was the ruined possessions of the families that lived there. Ash covered family photos and drawings taped to the charred walls. A heart with a child’s printed “I love you” tossed in the rented dumpster. Clothing & furniture tossed, by residents I knew had no renters’ insurance to reimburse them.

Then came the conversation with the the resident who attempted to put out the grease fire on his neighbor’s stove. “If only we could have found a fire extinguisher, we might have been able to limit it to the stove,” he told me.

Ironically, three hours before the fire started, I was in a fire prevention store ordering fifteen fire extinguishers. Delivery is scheduled for next week. I’d intended to get around to it months ago. I thought we had some extinguishers in the office, but also thought we should try some wall mounts outside, in cases, to see if we could make them more accessible while minimizing vandalism.

I had been thinking about mounting one just outside the door of the unit where the fire started. A $60 expense that might have prevented a $100,000 loss. Solomon got it right–pay attention to the basics. Know what’s going on. Don’t get so caught up in what the market’s doing or in what’s new to neglect the basics.

We still need to keep up with current trends. We’re getting more resident leads from Craig’s List today than from newspaper ads, for example. But the basic, unglamorous things like fire safety, grounds keeping, resident selection and screening, cost containment, client satisfaction are still what will make or break any business. That goes for rental property and for home ownership.

Part of the problem is that the Urgent is rarely Important, and the Important is rarely Urgent. But that “stitch in time” still can save nine stiches later.

The city Fire Chief recommended 5 pound (net) rechargeable fire extinguishers with metal heads & spouts, rated ABC (trash/wood, grease, & electrical fires). Actually at least 2A10BC. Around $40 at Lowes, slightly less in quantity at Maintenance USA. Roughly another $35 for the safety case. You might want to pick up one to keep near your kitchen or garage at home. And at least one more for any rental properties you own.

The same principal applies to what’s much more important than possessions: Family, relationships, health, friendships, our walk with God. Pay attention! Don’t neglect the important for the urgent. Keep your priorities straight. Do some preventative maintenance. It’s easier to install fire extinguishers than to gut & rebuild apartments, but apartments can often be rebuilt much easier than relationships. It’s far easier to fix ruined buildings than ruined lives.

That’s not to say there isn’t hope for even the most hopeless situation. That’s just one of the many wonderful messages of Easter. Just today I passed a church with a sign, “Nothing is Too Hard for God.” Guess someone knew I needed that today. Just like eleven discouraged disciples 2,000 years ago, after their Messiah was arrested, unjustly convicted, and crucified. But, as one of my favorite sermons says, “It’s Friday, but Sunday’s coming!” God can redeem any situation if we let him.

But the first step could be to prevent the situation from getting any worse. Take it from someone who learned that lesson the hard way!

Earlier today we discussed the stats that showed median prices in Southern California as a whole were down 19% last month from their peak in July of 2007, also touching on our projections for the rest of this year (“So Cal Price Update”).

Frankly, in our primary market areas of West Orange County and Greater Long Beach, we believe prices actually peaked in the summer of 2006, based on comparable homes. DataQuick’s 7 county numbers were skewed by the huge foreclosure problems in the Inland Empire, as well as inherent flaws in their median pricing system. The Orange County Register’s Real Estate Blog has a good summary and explanation of 8 different indexes & their most recent reports for Orange County. DataQuick showed the greatest year-over-year decline (16% in O.C.), while the other indexes ranged from 15% to 6% drops.

Basically, we still believe we’re in uncharted territory & nobody knows what’s next, as we wrote back in November (”How Low Will Prices Go?”).

Our recommendation for Los Angeles and Orange County buyers and sellers is still to focus primarily on where you are in life, not where the market is. Since nobody really knows what’s next, don’t get too obsessed with what the future holds.

If selling makes sense, why roll the dice & wait up to six years (or more?) for prices possibly to just get back where they are now?

As for buying, if you can buy a home that works for you with a 30 year fixed loan, why gamble on rates or prices going up, or waste several years of your life gambling things will get worse before they get better. (see “What to Do When Nobody Knows What’s Next.”)

We’re not saying it’s time to buy for speculative reasons, and we certainly wouldn’t be trying to “flip” right now unless I got an extraordinarily good buy (and that does happen in market’s like this). I’m certainly not saying we’ve hit bottom.

We’re saying nobody really knows, because we’ve never seen anything like this. For example–we think the Fed caught just about everybody by surprise this week with their creative moves to enhance liquidity.

Who know what might come next? If some lenders were smart, they’d just shave $100,000 off the loan if needed to avoid foreclosure. They’d certainly drop interest rates or eliminate the obscene resets they have coming. (Of course, if they were smart, they wouldn’t have made 100% loans to subprime borrowers without income verifications when the market was obviously peaking, but maybe they can learn. . . .)

We’re saying nobody knows what the future holds, especially this time. So if you’ve always dreamed of a home on a lake in Lake Forest & find one that works for you with 30 year fixed financing, & if you’ve got a stable job & aren’t moving, why not make an offer & start living your dream? If it works, maybe you should let your life determine decisions, not speculation. Here’s a novel thought: think of it as a home, not a piggy bank!

Ditto to sellers. Forget what your neighbor got 2 years ago. Prices on your next home are down too, and so are interest rates. Maybe you can’t get the triple garage, but maybe you never would. If everything else works, give it a shot. You’re not getting any younger!

We’ve watched the market and buyers and sellers for 30 years, and we see some unique opportunities right now that may not last. And we see too many people making decisions based on ego or gambling in stead of getting on with their lives.

Feel free to call 562 822 SOLD or simply comment if you want specific input on your situation.

Today’s Los Angeles Times has DataQuick’s February closing statistics for the 7 county Southern California Region, & it’s exactly what we predicted: Sales up from January, prices down.

Unfortunately, what writer Peter Hong never seems to mention in the article is that this is old news, for 3 reasons: First, today’s March 14, & DataQuick’s reporting average closings during February, making the average sale date a month ago today. Second, that’s the date the sale closed, so those homes mostly went into escrow in late December and early January! Third, lots has happened just this week to address the underlying problems, most notably the Fed’s new program to increase liquidity.

The article does have a fair amount of quotes from a variety of experts, most saying this means things are a bit worse than they thought. Well, things were pretty bad in December, but they did pick up in January and especially February, so we still expect better news a month from now, when DataQuick reports March closings–which mostly opened escrow in January. And we’ll guarantee sales volume will be up. It’s really not that hard to predict what’s coming in on this month’s freighter if you talk to the guy who loaded it up!

We still think there’ll be a significant increase in closings through this spring, and quite possibly a modest increase in prices, but we also anticipate continued price declines as we move through fall and winter. The real bottom may still be a couple years away, but, as we pointed out here in our November piece, “How Low Will Prices Go?”, this is the most unpredictable downturn we’ve seen, and nobody really knows where it will end.

As Hong’s article eventually points out, DataQuick’s numbers are overly negative due to the preponderance of low end sales, where most of the foreclosures are. We’ve got lots more to say about this, and hopefully we’ll get more posted tonight. For now, I’ve got to get on the road and check on some units that burned last night. Now that’s a real “overnight” decline in value!

Today we’ll take a break from Southern California real estate to look at Easter, an inspiring event which helps Blair & I keep some perspective in even the craziest market.

Easter comes early this year, and 2008 is one year we could all use some inspiration as early as possible!

Jesus’ life, death, and resurrection provides hope, joy, perspective, and lessons in love, forgiveness, grace and endurance. Many Christians traditionally use the 40 days leading up to Easter Sunday as a period for prayer, repentance, and various levels of fasting. I think even folks who aren’t especially religious can benefit from contemplating the final weeks of Jesus life. (And any anti-Semites should remember all the main characters, including Jesus, were Jewish, but those who actually crucified him were Romans.)

In the weeks leading up to Easter, I usually try to read through and meditate on the Biblical accounts of the events of Holy week. Much of Jesus’ teaching related to trusting in God, dying to self, and loving God and others. In the last week of his earthly life, Jesus lived out these teachings magnificently. I’ve grown much from spending time reflecting on these events.

So, with 17 days remaining until Easter, may I suggest a mini-lenten series of readings on the life of Christ? Actually, a choice of two: A read-through of all of Mark’s fast moving Gospel, or of the last half of Matthew’s more detailed Gospel.

In either case, it’s a simple matter of reading a chapter a day, about the length of a sports’ columnist’s article. I do recommend a time of prayer before and of meditation, application, and prayer after. Can’t say I’ve ever used that approach with T.J. Simers’ column in the L.A.Times.

I prefer using a version of the Bible that’s in language I understand easily, which isn’t the King James Version in my case. Lately I’ve been using the English Standard Version, which is available online. If you click on this link, it will take you to a search page–just type in “Mark 1″ or “Matthew 12,” and the chapter will appear.

If you want an emphasis on action over sermons, I’d recommend the Gospel of Mark, which was written by a younger associate of St. Peter around 60 A.D., based largely on Peter’s first-hand recollections. (I majored in Roman History at UCLA, so that sort of thing is important to me.) If you subtract 8 from the date, you’ll read through all 16 chapters of Mark from this Sunday, March 9 (9 – 8 = chapter 1), through Easter, March 23, if you subtract 7, you can start tomorrow (Saturday) & will finish with the resurrection story the Saturday before Easter.

If you’d also like to pick up some of the lectures of Jesus too, then I recommend Matthew’s Gospel. Matthew was one of Jesus 12 closest disciples, and this is his first hand account, also written around 60 A.D. He was originally in the accounting field, actually a hated tax-collector for Rome who Jesus reached out to. If you want to end with the resurrection on Easter Sunday, just add 5 to the date and read a chapter a day (for example, if you start this Saturday, March 8, 8 -5 = chapter 12.)

If you’re a bit of a skeptic about how accurate the Gospels are, just click this link for a fairly concise summary. If you want to investigate the evidence for the resurrection of Jesus, click here, or here or here. If you prefer to consider the evidence in a “whodunit” format, you might want to check out Scott Hong’s “The locked tomb mystery.”

Regardless of your religious or non-religious persuasion, we wish you a joyful celebration over the next several weeks, and continuing growth throughout the crazy year ahead.