How low will home prices go? Do you really want to know

When the real estate market was in full boom, this two-bedroom, shoebox of a bungalow on Portia Street once boasted a price tag of more than $400,000 and a fire-engine red BMW sedan parked in the driveway. The shock of how much our new Echo Park neighbors were paying was usually followed by the question: “How could they afford that?” We never bothered to answer the question because we (homeowners, I mean) instinctively began re calculating our own property values: “Well, if that runty house sold for more than $400,000, then my house (bigger, further away from Dodger traffic, fewer abandoned sofas on my block) is $600,000 easy.”

Now the real estate boom is suddenly over. The same Band-Aid colored house is now empty and in foreclosure The BMW and its owner have not been seen around in a while. The bank’s asking price: $265,000 “Hardwood flooring! Gated! Light & Bright! Cute! Don’t miss!,” reads the listing. News of the stunning price cut now prompts the questions about the sanity of our former neighbors: “What were they thinking?”. But as for our property values, we are not asking any questions and would rather not hear the answers.

Photo from MLS CLAW

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