Friday linkage

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Last week I posted a link to New York Times economics reporter Edmund Andrews’ tale of his own home mortgage default. Now, the Atlantic reports Andrews’ wife had filed for bankruptcy -- twice. That makes their story more complicated than a couple caught up in the mania of the housing bubble, details that were omitted from the Times article and Andrews’ upcoming book. (Thanks to a well-read LA Land reader for the tip.) The Atlantic report says Andrews did not return calls seeking comment.

Back in August, I posted an item titled ‘Any More Bubble Left to Burst ?’ featuring a house whose owners were trying to sell because they were upside-down. I thought then the house was a good test case for how high-end prices would correct -- slowly, but inevitably.

At that time, the 2,300-square-foot Pasadena house was listed for $875,000, down from an original list price I think was over $1 million (I’m not an agent, and thus don’t have access to MLS past listing data). Its owners had paid $898,000 for it in 2006.

The agent said the owners were facing a rate reset they couldn’t afford, and had to get out. A few months later, the bank approved a short sale, and the house was listed in the high $700s. The house had $920,000 in loans.

Now we’re done with Act 2: It was foreclosed on two weeks ago, sold back to the lender at $650,250. Who knows what it will be listed for when it returns to the market. It did not sell at its recent high-$700s list price, but its short sale status may have been a deterrent. Zillow still lists its estimated value at more than $ 1 million -- which the market has repudiated.

By the way, two months after posting about that property, I bought a house just a short walk from that one. Some commenters here say my reporting is biased by my home purchase. Perhaps -- we all have biases.

But believe it or not, some of us take pride in doing our best to squeeze those biases out of our journalism. Given the financial state of newspapers these days, that pride in the quality of our work is something we cling to dearly -- it’s one of the few things we as reporters can control.

So we do things like disclose potential sources of bias (i.e. my home purchase) and report as honestly as possible. That’s why I report on tanking home prices and distressed properties, even when they’re in my neighborhood.

-- Peter Y. Hong