The foreclosure crisis has hit Modesto's housing market hard in the last few years, driving down home prices. It had the fourth highest rate in the nation according to a July report from RealtyTrac.
The housing bubble had inflated home prices far out of proportion to income in the Central Valley city. Once the bust hit, prices dropped by about two-thirds from their late 2005 peak, putting mortgage borrowers in jeopardy.
The continuing flood of foreclosures coming onto the market has kept home prices at bargain-basement levels, and Modesto homebuyers are reaping the benefits.
