Californian Home Prices Are Over-Valued By 35-40%

So says the title of a Goldman Sachs report (the overpaid rocket scientists at GS could've found out the same thing a year or more ago by reading Calculated Risk or the Irvine Housing Blog or any one of a number of other sites).

Anyway, highlights include:

• CA prices as 35-40% overvalued.
• The madness started in 2004.
• National prices are 13-14% overvalued.
• Countrywide (CFC) and Washington Mutual (WM) have high exposure (45-50%) to CA.
• While housing prices have been "surprisingly resilient", a downturn is "imminent".
• Subprime adjustable mortgage resets peak in March 2008.
• Pay-option adjustable mortgage resets peak in June 2010.

We are nowhere near a bottom in housing.