Anyone that is buying downtown is really going to feel the pain in the next few years. What is the intrinsic value of a small box with a view of other buildings? I may be crazy but I could see some of these going for $50k – $100k. Please explain to me what the true value is in a downtown shoebox? $100,000 is a lot of money and people have grown accustomed to throwing around terms of hundreds of thousands of dollars. This will all change soon. Banks are becoming concerned and borrowing at some point will be a lot harder to obtain. Think about this, if there were no such thing as ARMs, do you think 3/4’s of the borrowers out there would be able to afford anything? I think not.
I’ve already heard nightmare stories of people that have bought a shoebaox and for some reason or another are trying to get out but can’t. Also had a conversation with a prominent realtor in San Diego and he is absolutely scared of downtown and would never recommend a client to that area.
