My original input into this thread was merely to weigh in on whether to “rub it in” to current property owners as to the cooling real estate market. My point made was that there is nothing to “rub in” to the folks like me who are hundreds of thousands of dollars on the plus side and have locked in the lowest interest rate seen in our lifetime. Again, I would not trade my position with someone who is sitting on the sidelines cheering for a disasterous crash and who in fact needs a disasterous crash to occur to allow them to get in the game. That’s it.

As for my thoughts on the future of San Diego real estate, I believe prices will continue to pull back throughout 2007 and possibly into 2008. It’s impossible for me to generalize by what percentage as SD is made up of far too many micro-markets. I do know the 3 areas where I own property (Mission Beach, Pacific Beach and Bay Ho) and I believe in the end I will see comps down about 15-20%. Just a guess. I don’t pretend to have some magical superhuman insight.

At this time, several of the major factors that can really impact real estate seem to be lined up against major-crash theorists. Builders are out in front of this thing and have dramatically scaled back or ceased production. Interest rates remain extremely low. Unemployment remains low. The stock market has performed extremely well (particularly since some folks proudly announced they were going to cash last summer). None of this helps the crash theory.

Over the long haul, I am very bullish on SD. I lived through the tough times of the early/mid 90’s and still recall many discussions with real estate investors then, who all opined that SD was eventually going to end up like San Francisco with respect to real estate valuation. I agreed with them then and still do. While SD real estate prices have run up too far too fast and will indeed pull back, over the long haul I believe the values are going up and we will maintain pricing that is among the highest in the nation.