Quite simply, I’ve become more reluctant to buy right now. Or maybe it would be more accurate to say, more willing to wait.
I expect to buy in an expensive neighborhood. (La Jolla) I have cash in treasuries. While I make crummy interest on my principle, I haven’t lost principle in the last year. But during the course of that year, other potential buyers have seen things get much rougher for them. Loans are much harder to get, more expensive (we’re talking jumbo here, not conforming) and if they had money in the stock market, more than likely they’ve lost money. So why not wait? I figure things are going my way, and most likely will continue to go my way. Or put another way, I suspect that many buyers of high end housing in San Diego are slowly getting pushed out of their price range. Plus some of those retires who just had their retirement funds vaporize might need to sell their houses now! Thus I expect significant price drops in the coming year for high end areas. So why not get comfortable and wait?
