What was Hahn thinking? He wasn’t—just like so many people and that was the problem.

In Jonathan Lasner’s (O.C. Register) interview with Walter Hahn, on Wednesday November 14, Lasner asks Hahn, a longtime market watcher, (over 40 years)  why he didn’t pick up on the huge Real Estate downturn and sub-prime crisis.  Hahn, just  two plus years ago, predicted that the O.C. median price would hit $1,400,000 by 2014.  Hahn’s answer was that he had had a blind spot, and that the housing market boom from 2003 to 2006 was caused (according to Hahn) almost exclusively by the introduction and pushing of low teaser rate loans.  Then of course, Wall Street provided the money to fund the loans by packaging the loans to support financial instruments that they sold to bigger “suckers”.  Hahn says, “Shame on Me” for having my head in the sand and (not) paying attention”.  Even the group, Earth Wind and Fire knows that “What goes up, Must come down” and so many of us in the Real Estate Industry knew that the market was not going to continue going up.  From May through December in 2004 there was a huge spike in inventory in comparison with units sold.  Anther indicator that the market could not continue in an upward fashion is that incomes were not keeping pace with sales prices. There are some reasons why Orange County will be less affected that other So Cal counties and other metro areas around the U.S.—we have little undeveloped land, a desirable weather climate and business climate, and we are not grossly overbuilt.  About 20% of the zip codes in Orange County have relatively few loan defaults and foreclosures.


Lesslie Giacobbi


Lesslie Giacobbi



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