With its beautiful geography, lower prices, and proximity to jobs, residents from expensive Southern California cities escaped the high cost of living by moving to the Inland Empire.
Click on map to enlarge
Riverside and San Bernadino Counties were among the largest population gainers between 2000 and 2006, according to the Census Bureau. They also have now the highest rates of foreclosure (see map above). As people moved into the Inland Empire, demand for homes rose. Speculators entered the market in response to rising prices, and builders rushed to fill demand. Prices rose ever higher, and those desperate for a home resorted to I/O loans and Option ARMs to finance their homes. Other refinanced from that "home printing press" and basically are now paying the price.
As this bubble has unwound, sales have plummeted, and the housing sector is in horrible shape. The Inland
Empire seems to make it onto almost every national list of "the worst of...", such as having the highest foreclosures and lowest affordability.
The chart on the right, an example of what you will find in premium content, shows sales since 1988, and inventory and months supply since September 2005. Months supply is around 4-6 in a healthy market. Under 4, prices rise too fast, such as what happened during the boom. Above 4, prices will fall, and that is what we see now.
Read a free sample of premium content, which includes the above chart and one on median prices, here.
What is in store for Riverside County? 
Will people keep moving here, keeping up demand for homes?
Will Riverside keep leading CA's foreclosures?
Can prices drop in half?