This could be the most poorly constructed case you’ve ever come up with.
So high prices here are a problem but $800K there is not?
Have you been here lately? The economic expansion going on is mind boggling. Drive around the economic cores of SD (Golden Triangle, Downtown and College area) and things are booming. There are so many massive construction projects going on you cant count them all. There are cranes everywhere around UCSD, UTC and Sorrento Mesa. The airport expansion is masive and remarkable! Those who have not driven up to terminal 1 past what will become the new airport are in for a shock. It is massive! SDSU is expanding all over the place too.
If you see a 25K builder price reduction on houses like yours what you are not seeing is at least another $50K decline hidden via interest rate buy downs, free upgrades and more. The absolute last thing they do is drop prices! Things must be even worse than I thought!
The average working family buying in MM is working at UCSD, a tech company or in the life sciences core. They are buying a modest size home remodeled to current standards on an extremely valuable piece of land. When prices rise here it is the land component that appreciates not the house. In St George for a house to appreciate 250K where land is abundant and virtually unlimited they are paying that extra for a rapidly depreciating house. That is a horrible situation for someone that “I’m sure has heard of the idea that supply and demand determine prices” It is a recipe for a crash of the worst magnitude
The best paying jobs Jobs there are building homes which is entirely unsustainable. When that slows look out below. There is no long term economic engine there. Its just not economically viable
Sure we are losing some residents due to high prices but that pendulum always swings back here because we have a location people covet and a massive economy fueled by the most vital and sustainable industries (tech, medicine, biotech, telco etc) and the military!
People dont need 3200 SF. They dont need forever views of emptiness. They need a livable home and good jobs the later of which SG lacks.
Finally, you mention our property prices will stay high because we have so much more demand than our limited supply. Even if you want to live there its just not prudent to invest in such a fragile situation with endless supply. Its not a safe investment. Diversification!
