San Diego - Ground Zero

San Diego seems to be ground zero for the housing bubble. Other hot areas that could burst early (or they are already burstin) seem to be Miami, Vegas and Boston. I was reading today on the Ben Jones site that some feel that New York City properties might have some sort of built in immunity from sharp price decreases. The rationale behind this line of thinking is that co-op boards are stringent about making sure the buyer can actually pay for the apartment, and often require more than 20% down payments. This would make sense, however, co-ops have always existed before, and its not like NYC housing prices have never collapsed. Basically, despite tough co-op board rules, property values were still haircut substantially when the apartment market fell apart in NYC in the late '80s.

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"Home prices have accelerated at a rate far faster than household income and this has increased concerns there may be a bubble out there," said Greg McBride, Senior Financial Analyst at Bankrate.com. "The fact that homes may take longer to sell and the fact that mortgage rates may go up could throw cold water on what's currently a very hot housing market."

Entire article...