[quote=profhoff]Yeah, flu, the Qualcomm price correction everyone waited for…
Yet, in SF, rents are going down and there is definitely talk of a bubble. VC money is tight and the housing blogs suggest price increases in real estate are already starting to slow down…
In LA, rents are going down, too.
And incomes certainly aren’t going up fast enough to keep pace.
So there are some definite clouds on the horizon in California!
My own theory is that there are a lot of aging boomers in NCCSD and there is no reason for them to leave. Plus, there are a lot of boomers on the younger end moving in – maybe buying that retirement place ahead of time so they can lock in the tax base now instead of 5-10-15 years from now, not to mention crazy low interest rates where jumbo is less than conventional and pretty close to 3% – and that’s putting pressure on inventory and pushing prices up.
But how high can it go? And as prices keep going up, are there really enough people with that much money?[/quote]
The way i look at is, where is the money source from and how likely is it to disappaer.
In SF, wealth is significantly tied to stock options, and pretty much everyone gets them.
In SD, companies aren’t so generous to everyone, especially less experienced/lower level people. So the question is in SD where is the money from? Probably more to do with “old wealth” and/or other highly compensated professions.
So, assuming we have a stock market correction, I’d say the hit to the bay area will be a lot more than probably here.
Not sure where the money from LA or SD comes from. But apparently many people have it.
Also, the inventory is low in SD simply because builders aren’t building.
And probably most homeowners aren’t in a hurry to sell, especially if their mortgage payments is ridiculously low.
