Are signs of a So Cal bottom misleading?

UBS Investment research recently met with Bruce Norris, founder of The Norris Group & an expert on So Cal housing.

On May 27th, they reported the key takeaways: 1) recent signs of stability in this market were likely premature; 2) driven by the expiration of the foreclosure moratorium in April ‘09, they expect foreclosures this year to exceed ‘08 levels; & 3) efforts taken by the Fed gov’t to encourage loan modifications aren’t working in CA, as homeowners are too far underwater to make this viable. Accordingly, they expect prices to decline further through the remainder of the year.