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How could prices in states like California soar like they did when 1+ million people left that state just this decade?
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Greed.
A lot of speculative investors buying homes in the hopes of flipping for a profit.
I have a lot of friends whose neighbors have multiple families sharing a single residence home. People are still coming though.
The Bay Area is highly saturated with immigrants from everywhere .. all wanting the American dream and for many people, homeownership is their number one priority.
Unfortunately, many lenders took advantage of that and got them into horrible loans that are now adjusting to levels that they can't maintain..
Cycle started a few years ago, listings saturated the market, homes weren't selling, people couldn't make the payments, foreclosures, bank sales brought down the value finally equalling lower prices.