Struggling To Unload Homes
CBS
Transcript
[Music] Homeowners in California are learning about the market the hard way as we hear from Bill Whitaker. I really love the high ceilings which are in all When Christina Rossy bought this condo in Orange County for $440,000. It was like buying her piece of the American dream. I felt like this is an amazing opportunity for me. I actually own property in California. not just a great first home, but a great investment, too. Everybody's doing it. You buy it and you sell it in two years and you know, you make a profit on it and you move on. But three years after buying in, her plan isn't panning out. Then she had to fight off a pack of buyers and managed to grab the condo just 5 days after it hit the market. Now, it's been languishing on sale for months for about the same price with not one offer. What is going on? Why isn't anybody buying? Sellers across the country are asking the same question, says Mark Xandandy of Moody'seconomy.com. This is not the time to be out there trying to sell your home. Why? It's a simple matter of supply and demand. The Mortgage Bankers Association reports there were more foreclosures at the end of last year than any time in almost 40 years, pushing more houses on the market, pushing down prices. Remember those risky subprime loans that lured buyers with initial low interestonly payments? Well, on many the honeymoon period is over. Monthly payments are mushrooming, forcing many new homeowners into default, which means many more houses might soon be flooding the market. And that means that all sellers are going to have to cut their pricing to be competitive. And that means prices across the board will be weaker.