"How long will the pain last?" As the key question on the minds of the 50 real estate professionals attending the Rancho Financial Educational Luncheon entitled "Tired of Hearing ‘The Sky is Falling’?", Peter Dennehy of Sullivan Group Real Estate Advisers almost an hour examining the fears and realities of today’s southern California real estate market.

"There’s a lot of anxiety out there, and we felt it was important to address it with solid, quality information" says Rancho Financial president Craig Brown. With California’s home sales projected to be down roughly 12% this year over 2005’s record-setting pace, the full gamut of interested parties – buyers, sellers, financiers, agents and support service providers – are all understandably concerned with where the market is going in 2007 and beyond.

Dennehy examined the marketplace from national, regional and local perspectives, speaking knowledgeably and realistically of what to expect – warts and all. His examination walked attendees through a history of the marketplace, in-depth examinations of consumer and industry sentiment; and what the future has in store for San Diego County’s housing market. A few of the presentation’s highlights included:

Ø      Local consumer sentiment is 12 points higher than the country overall;

Ø      Builder sentiment has risen by a full one-third from its low six months ago

Ø      Local non-farm employment has grown in every quarter for the past 14 years

He also acknowledged there are problems in the market, including:

Ø      Resale prices have peaked and are softening

Ø      New building permits are currently at their lowest level in 10 years

Ø      Sales volume this year in southern California is down about 14% over last year

"It’s not as easy as it was a few years ago" said Dennehy. With San Diego resale time on the market up from 20 days to 63 over the past three years, no one in the room was arguing the point. However, when considering the market of 1992 – when resale took 94 days, he observed it could be much worse.

One point in particular caught attendee interest, though. The last four real estate downturns ran from 17-35 months in length from the top to the bottom of the market. The current downturn has seen the market drop 40% in 19 months, suggesting the worst may be behind us.

Mr. Dennehy believes the next 18 months will bring pain, further price reductions and additional drops in land values. Yet one needs look no further than the combination of 20% population growth that’s expected in
San Diego County over the next 13 years and the region’s shrinking pool of available buildable land to
anticipate a solid rate of growth once the current blip is overcome.

"Focus on the basics, provide good service and have a solid strategic plan in place to ensure your success."
said Craig Brown as the event concluded.

Known throughout the real estate, financial services and legal communities as San Diego’s premier full-service mortgage lender, Rancho Financial has spent 24 years cultivating its reputation for finding the best loan, giving the highest quality service, and delivering more than the customer expected. They are known for handling every type of transaction – residential, commercial, land, construction, refinancing and income-producing property acquisition.