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O Foreclosure Pioneers!

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The New York Times looks at all the different ways that cities and suburbs are reacting to the economics of the housing crisis. In cities like New York and San Francisco, the paper describes the market as a frozen, meaning home prices haven't come down that much, nor is anyone selling. On the other hand, sales in the suburbs are up, but the bulk of those transactions are foreclosures or short sales. More via the paper: "The further you get from the city, the more prices have declined, and that’s where we see sales increasing,” said Glenn Kelman, chief executive of Redfin, a real estate brokerage firm. “Eighteen months ago, the city was the only place where people were still buying homes.” The paper also trots out the same hypothesis (but doesn't follow much up on it): California could be the model for the rest of the country in terms of recovery, ie, we hit bottom first, and we'll be the pioneers, lead the way in terms of being the first out of mess. Meanwhile, the paper also points out a recent survey that says: 1. Los Angeles area is closer to the bottom than New York and 2. Home prices will hit bottom in 2010, after falling another 15 percent in 2009. [NY Times]