Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Money and Main Street

The Bust is a Boon

From California to D.C., falling home prices and cheaper mortgage rates are making dream homes possible.

1 of 9
BACKNEXT
Madera, Calif.
Madera, CA
See More Views:
1 2
Purchase price: $155,000
Price change from peak: -48%


Despite getting laid off from his banking job on Christmas Eve, Armando Avila has retained his optimism. The long-time loan officer believes his job skills and experience will be much in demand as steeply falling prices fuel a big upturn in the number of homes sold in California's Central Valley, where he and his wife live.

"It's going to be a good time to be a loan officer," he said.

Christmas week was quite a time for the Avila family. First, Armando was laid off on Wednesday - and a Merry Christmas to you. Then, he and wife, Elizabeth, closed on the house on Friday.

The property is in Madera, a mid-sized city near Fresno, where the housing market has been on a rollercoaster ride. But the plummeting prices gave Armando and Elizabeth, an administrative assistant with a contracting company, a great buying opportunity.

The house was a bank repossession of more than 1,800 square feet with four bedrooms, two baths and two living rooms on a nearly quarter-acre lot. They paid just $155,000 for a house that last sold for $364,000. That's not unusual in Madera. Prices are half what they were at the top of the market and have dropped 30% through the first three quarters of the year, according to Zillow.com.

"It's really a good time to buy here," said Armando. "You're able to get a good house in the good side of town for an affordable price."

A big component of their bargain buy was that they were able to get a great rate on their mortgage - just 5.625% on a 30-year fixed rate. That pegged their monthly payment to just over $700.

"We're only paying $38 more a month than out current rent," Armando said. - L.C.
NEXT: Castle Rock, Colo.
Last updated June 15 2009: 10:24 AM ET
Email | Print | Share  |  RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
More Galleries
Google's logos through the years Google changed its logo for the fifth time in 17 years this week. Here's what the old ones looked like. More
How much you should have saved for retirement right now Joe is 50 years old and makes $70,000 a year. He should already have $364,000 saved for retirement. Are you on track? More
The stock market's wild week in 6 pictures It was the wildest week in stocks in recent memory. Here's photos and CNNMoney's tweets of reactions to the panicked selling on Monday and Tuesday, which gave way to a mad buying scramble on Wednesday and Thursday. And then...a selloff on Friday again. More

Special Offer