90s r/e downturn was almost entirely due to unemployment resulting from defense industry downsizing from Reagan years. LA r/e indeed was hammered worse b/c of defense industry concentration there. If unemployment stays ok then housing market will experience only moderate declines from here. It’s all about employment.
At this point in the game I think it’s more that SD overshot on the upside than that LA is “lagging”.
Question: Why was SD the leader in the recent r/e runup?
Answers:
– larger businesses moved in and others (ie Qualcomm) finally reached a critical mass in SD (along with its more affluent workforce to bid up homes)
– compared to other major SoCal locales SD prices were lower to begin with so double digit increases were easier to achieve earlier on
