Housing decline good for some folks

When you look at the prices of homes in California, it's important to remember that old Paul Simon line.

"One man's ceiling is another man's floor."

A few years ago, at the peak of the housing bubble, the median price of a home in the Golden State reached $580,000. Affordability was at an all-time low and wealth -- at least on paper -- was flowing to people who owned homes.

Many of them took advantage and refinanced their mortgages to pay for remodeling, new cars, vacations and other luxuries. They figured if the bills came due, they could always refinance again or sell their homes at a profit.

Then the bubble burst.

The economy fell apart, unemployment went up and the state budget incurred massive deficits. And in the process, all that wealth disappeared. In April 2009, the median price of a home in California was $256,700. That's a drop of more than 55 percent from the peak, and there's no guarantee that the bottom has been reached.

Bad news, huh?

Not for the people who couldn't afford houses before and have seen them drop into their price range. They may still have trouble getting loans with the current tight credit market, but when it starts to loosen, there will be many new homeowners.

And that's certainly not a bad thing.