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I took another tour of the sprawling communities east of Los Angeles this weekend. I drove south from Fontana on highway 15, past acres and acres of warehouses. Then came Norco and Corona, which reminded me of my trips to suburban Las Vegas a few years ago. In Corona you see a dozen small office towers along the highway, almost all of them filled with real estate related tenants. There were builders, mortgage companies, title companies, real estate agencies.
I wondered how these buildings could all stay occupied given the bust. That’s when I passed one—formerly the home of Pardee Homes—with big signs on it that said the entire building was for lease.
Next on the tour was Lake Elsinore, a resort town with actually quite a pretty lake nestled amidst the mountains. One thing Lake Elsinore did not seem to have is any inherent industry—other than a few boat rental outfits and an outlet mall—and seeing as how it took me an hour to get to Anaheim and two hours to get back to Los Angeles even on a Saturday afternoon—I’m guessing the commute time to anywhere but Corona is brutal.
Highway 91 is a toll road but you have to have secured your EZ Pass-like payment card in advance. I would have gladly paid the $2.80 advertized price in cash to get out of that traffic on Saturday.
I stopped in one of Lake Elsinore’s many new home developments—this one run by Castle & Cooke. The 2,000 square foot, 3 bedroom homes still seemed a little pricey to me at $260,000, given the remoteness of the place. The saleswoman said they were having a big sale 10% off the list price and 6% more toward closing costs if you use their in-house financing arm. Sixteen percent right off the top before I have started to negotiate! I guess its easier for them to do that than to actually lowering their prices.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.