Flyer, why do you think a downturn is more likely than another bubble?
We still have a growing population and economy with extremely low new construction. Tech is the world’s most important industry, will continue to gobble up a larger share of world GDP, and its immovable center is the bay area.
The amount of wealth there is so huge it is crazy prices aren’t even higher. So many people worth $50+ million with only 5% of their net worth or less in real estate, when the American norm and tradition is more like 20 to 50%.
Even at their current high prices, the Bay Area isn’t that expensive compared to Manhattan, London, Dubai, Hong Kong, etc. And incomes are higher when you consider the value of stock options.
Related point: San Diego prices have gone up less on a percentage basis not just than SF/LA, but also less than cities like Denver, Austin, Seattle, Portland, Miami, and DC.
While we still aren’t cheap, there is no longer much of a premium in San Diego compared to other tier 2 cities.
