The curent state of affairs

Here we are, at the dawning of a new year, and what the heck is going on.
The Real Estate Market continues it's downward slide, and while this is a terrible time for those of us with Option ARM's and Interest Only home loans (loans that are quickly becoming upside dowm), it's a great time to get your first home, or to purchase that investment property.
There are some really great deals to be had, and although the unfortuanate fact is that they come at the misfortune of others, now is the time to buy.
I am asked again and again when will we hit bottom: I wish I knew. It all depends on who you listen to. I've heard that recovery is just around the corner, and we should see a rebound by the end of the year; I've also heard that the recovery is several years away, and that a lot of people still have to lose their homes before all of the mortgage lending fiasco finally corrects itself.
The fact that Federal Reserve Bank President Ben Bernanke stated in his Economic Outlook speach on 1/10/08 that the Fed will aggressively cut interest rates to help slow any economic slowdown is a good sign for all of us.
Indications are that he will again cut the Federal rate .5% at the next meeting on the 30th of this month. This will help all aspects of the economy, specifially anyone with an Equity Line of Credit, who should see an immediate drop in their payment as interset rates adjust downward.
Let's hope that we are bouncing at the bottom of the economic downturn, and mearly slowing as we near the crash landing. I remain an optimist (as foolish as that may be) and I look forward to a better year in 2008 than we had in 2007.

Current facts:
Calif. median home price - November 07: $488,640 (Source: C.A.R.)

Calif. highest median home price by C.A.R. region November 07: Santa Barbara So. Coast $1,075,000 (Source: C.A.R.)

Calif. lowest median home price by C.A.R. region November 07: High Desert $262,650 (Source: C.A.R.)

Calif. First-time Buyer Affordability Index - Third Quarter 07: 24 percent (Source: C.A.R.)

Mortgage rates - week ending 01/03: 30-yr. fixed: 6.07%; Fees/points: 0.5%; 15-yr. fixed: 5.68%; Fees/points: 0.6%; 1-yr. adjustable: 5.47%; Fees/points: 0.5% (Source: Freddie Mac)