[quote=no_such_reality]You forgot the tickle down expectations issue. AKA, settling for less.

From 2010 – 2015, detached housing in San Diego county grew by just over 8800 units.

In that same period, households in San Deigo county making more than $200K/yr grew by 15,400 households. Household making $150K-$199k grew by 8900 households.

During that period median income was essentially flat moving from $63K to $64K.

And with 606K SFRs in the county, not really a dent. However in the same time period of 2010 to 2015, total housing in San Diego grew by 26K units of all types while the population grew by 128,000 or roughly a housing need of 48K units of all types at historical owner/renter mix rates.

Finally, in 2010, homeowner vacancy rate was 2.6%, in 2015, it has fallen to 1.5%. Rental vacancy has also fallen from 4.9% to 4.1%.[/quote]

So basically supply and demand. I get where you are coming from, but I think that it would affect rental rates much more, which some would argue increases the $ threshold in the rent vs. buy decision. The only counter I would have to that would be the down payment requirement. Although people do like San Diego because of the weather, at some point if wages do not increase to match living costs with a little cushion to save; San Diego will end up like other places like Santa Barbara, or Hawaii which cater mostly to upper middle class retirees who are not reliant on a 9-5 job.