Industry NewsMarkets & Economy

No bottom for California city’s home prices?

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"Negative absorption" in Santa Maria Santa Maria, Calif., a city in northern Santa Barbara County, is facing five years of negative absorption for residential real estate, meaning it will need fewer homes as people leave to find jobs elsewhere, CalculatedRisk reports, citing a local land developer as a source. The blog also cites a Los Angeles Times story detailing a couple's purchase of a $412,000 home using a stated-income loan. Homes like it are now renting for $1,300 to $1,600 a month -- putting the house's current value at between $157,000 to $192,000, CalculatedRisk estimates. "There is almost no bottom for prices in an area with negative absorption. Just ask the residents of Detroit," the finance and economics blog opined. --CalculatedRisk Fed official: Banks must raise capital faster In testimony before the Senate Banking Committee, Federal Reserve Vice Chairman Donald Kohn said he expects to see weaker bank earnings and continued write-d...