You have no legal recourse against the developer and builder of your home if the next phase in the development have homes selling for significantly less than what you bought your for. Unfortunately, the reduced prices for new construction are the sign of the poor economic times in the real estate market.The decline in your home's value is not the result of problems with the home from a structural standpoint. Rather economic conditions have devalued your home. In California, if a home's decline in value is due solely to economic conditions the property owner has no claims against a developer , builder or former owner for damages.If you can afford the payments on your home, continue making them and hope that real property values in California stabilize and increase.