From the Realty Times:

However, a growing number of buyers who purchased homes at peak price periods in 2005 may now be living in homes worth tens of thousands of dollars less than their mortgage. That’s more likely if they used heavy leverage financing tools like no-money down and piggyback loans or interest-only and payment-option mortgages — as an increasing number of buyers do in Silicon Valley’s expensive market.
It’s not just Silicon Valley’s housing market feeling the pressure. Santa Clara County’s neighbor to the north, San Mateo County, has a housing market that lopped more than $100,000 off its median single-family home price since it’s peak in early 2005.

Anyone who claims that it’s impossible for housing prices to drop in San Francisco (just 20 miles north of San Mateo) is not only ignorant, but irresponsible.
Silicon Valley Inches Toward Buyers Market [Realty Times]
Gravity hits home values [bizjournal]

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