Near the '02 price in Laguna Hills

The OC Register is reporting that by S&P-Case/Shiller methodology the current real estate bear market has caused greater price declines in 15 months than those seen during the entire 71-month downturn in the 1990s.

Today's property is evidence of the accelerating downward trend of property values in the area. It's a short sale in Laguna Hills that is asking far closer to its June 2002 sales price than the amount "paid" in 2006.

The real estate bubble is long gone.

16 Carriage Hill Ln, 92653
Asking price: $399,000
Asking price/ sq ft: $212
Income requirement: $99,750
Purchase price: $635,000
Purchase date: 8/25/06
Size: 3 beds, 3 baths, 1,879 sq ft (built in 1982)
MLS: S520441 (142 days on Redfin)
ZipRealty price tracker: Price Reduced: 2/05/08 -- $590,000 to $535,000
Price Reduced: 3/03/08 -- $535,000 to $499,000
Price Reduced: 3/31/08 -- $499,000 to $465,000
Price Reduced: 5/04/08 -- $465,000 to $449,000
Price Reduced: 6/06/08 -- $449,000 to $399,000
Zillow Zestimate: $557,500
HOA dues: $240 + $32
Type: Single Family Residence
Style: Contemporary
Stories: 2 Levels
Lot size: 4,000 sq ft
From listing: One of the largest private lots in The Indian Creek Homes Community. This home offers a spacious floor plan with a living room and formal dining room and an abundance of light with all the windows. Peaceful backyard with a weatherproofed deck, lighting and sprinklers. Kitchen has been upgraded granite countertops and new appliances. Lowest priced home in this community...you wont be disappointed!


The owner financed the entire purchase price using a $508,000 first loan and a $127,000 second. The original asking (wishing) price was $590,000. No go. Now, the property has been reduced by $191,000. It's still on the market.

Here is the sales history:

Aug 11, 1988: $195,000
May 04, 1990: $249,000
Jun 10, 2002: $375,000
Jul 24, 2002: $359,000
Sep 27, 2004: $575,000
Aug 25, 2006: $635,000

Between 1990 and 2002 (around the beginning of the 1990s downturn to the beginning of the last housing bubble) the property appreciated by $126,000. That's a total of 51% over the course of about 12 years. Not bad at all.

From 2002 to its sale at the peak of the bubble in 2006, the property sold for $635,000. That's an increase of $260,000 or 69% or in just four years. When compared to some of the other escalating property values around South OC, this is actually a relatively modest appreciation.

Assuming a sale can go through for the current asking price, the lender would lose $259,940, including 6% sales costs. It would also mean a depreciation of 37% in less than two years, not including any sales costs.