Budget cuts could hurt California real estate values.

California real estate could still hit some unknown bumps before full recovery. The on going California budget crisis could send some more bad news for some parts of the state in relation to real estate values. As if this was not bad enough, the state now faces a large lawsuit that would only deepen the deficit. Many jobs could be on the chopping block.

With many families already running on thin budgets and on the thin ice with their mortgages, one can only speculate how many more homes could hit the market in the form of REO inventory bringing values down one neighborhood at a time. Commercial real estate projects could take just a little longer to be completed or up to full occupancy adding even more possible price declines in the form of lack of services.

While this could be good news for seasoned investors that know how to act quickly. the over all balanced could tip more in the direction of a more negative outcome for the entire state. After all less values, less taxes more budget problems.

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