A $270K price reduction in Downey

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Dr. Housing Bubble watches listings like a hawk, and when he finds a doozy he writes it up. This one is a doozy: A 3-bedroom in Downey that sold in 2006 for $905,000 and was priced as low as $635,000 at one point last year. The price has since been bumped up again, the doctor reports, to $715,000.

The home sold for $285,000 in 1997, and $905,000 in 2006. The good doctor is incredulous: ‘A 3-bedroom home in Downey approaching 1 million? Where the hell is Ben Bernanke so I can take him for a drive around Southern California and see if he still thinks raising caps is a smart move? By the way, for all you math junkies that is $620,000 in appreciation over 10 years or $62,000 a year. Why work when you can sit in your home and let it make more money than an average hard working family nets over a year?’

Good points. I’d love to hear Bernanke’s analysis of the Southern California housing market.

Your thoughts? Insights? What do you think the house will ultimately sell for? (It’s 3 bedrooms, 2 baths and 2,197 square feet). E-mail story tips to peter.viles@latimes.com.