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There actually is a real estate market outside of your little "Bay Area" and it is hurting:

Foreclosures up in 75 pct of top U.S. metro areas Thu Jul 29, 2010 2:05pm EDT

Foreclosure actions up in 3 of 4 large metro areas. Hardest-hit markets improve but well above U.S. averages. Job creation needed to stem foreclosures, boost prices.

By Lynn Adler
(Reuters) - Foreclosures rose in three of every four large U.S. metro areas in this year's first half, likely ruling out sustained home price gains until 2013, real estate data company RealtyTrac said on Thursday.
Unemployment was the main culprit driving foreclosure actions on more than 1.6 million properties, the company said.
"We're not going to see meaningful, sustainable home price appreciation while we're seeing 75 percent of the markets have increases in foreclosures," RealtyTrac senior vice president Rick Sharga said in an interview.
Foreclosure actions, which include notice of default, scheduled auction and repossession, in the first half rose in 154 of the 206 metro areas with populations of 200,000 or more.
"We're not going to see real price appreciation probably until 2013," Sharga said. "We don't see a double dip in housing, but we think it's going to be a long painful recovery for the next three years."
Nine of the 10 metro areas slammed hardest by the foreclosure tidal wave improved from the first half of 2009, suggesting a peak at rates that are still up to five times the national average, RealtyTrac said in its midyear 2010 metropolitan foreclosure report.
Cities with the 20 highest foreclosure rates were all in Florida, California, Nevada and Arizona.
Las Vegas had the country's highest metro foreclosure rate in the first half of the year, with 6.6 percent of its housing units, or one in 15, getting a filing. The number of properties getting a notice, however, fell 9 percent from the same period last year.
More than 3 million households are seen getting at least one foreclosure notice this year, and this record will be surpassed slightly at the peak of next year, RealtryTrac expects.
Banks will take over at least a record 1 million mortgages this year, RealtyTrac estimated earlier this month, noting that more than 5 million loans are seriously delinquent and face foreclosure.
FORECLOSURES TRACK HIGH UNEMPLOYMENT
All of the top 10 metro areas with the highest foreclosure rates, except for Phoenix, also had unemployment rates above the national average of 9.5 percent.
As long as unemployment hovers near 10 percent and unrelenting foreclosures hang over the market, prices cannot stage a lasting comeback. Home prices are about 29 percent lower, on average, than peaks set four years ago.
"If unemployment remains persistently high and foreclosure prevention efforts only delay the inevitable, then we could continue to see increased foreclosure activity and a corresponding weakness in home prices in many metro areas," RealtyTrac Chief Executive James J. Saccacio said in a statement.
Home prices rose in May for the second month, still propped up by the crush of demand for homebuyer tax credits that ended April 30, according to Standard & Poor's/Case-Shiller indexes. For details see [ID:nN27260375]
But that momentum will not last, economists agree.
Unemployment and wage cuts are chipping away at confidence and could slice average prices as much as 10 percent before a gradual climb resumes, many housing experts predict.
Sharga said the recent nominal price increases suggest that lenders so far have managed the distressed property flow well and buyers are bidding for those houses when they do get listed for sale. (Reporting by Lynn Adler; Editing by Jan Paschal)

#housing