Median home prices in both communities have dropped sharply over the last year, declining 33.6% in Corona and 30.3% in Ontario, according to DataQuick Information Systems. In Corona, the median sales price fell nearly $200,000 from May 2007 to May 2008, dropping from $565,000 to $375,000.
The question is, why was these homes in Corona and Ontario ever worth $565,000? They had no particular view. They had no particular location. They had no particular culture. They weren't in short supply.
So why the $565,000?
And the answer is..... because the builders could get it.
And why could the builders get it?
And the answer is..... because the bankers would loan it.
And how could the bankers loan it?
And the answer is.... through subprime loans that they knew they could get rid of.
So you take a bubble market, tie it to a money source that has no responsibility and you have.... a disaster.
Why is anyone surprised??
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