sdrealtor, I agree completely with you. The perception of SD as a living/vacation destination has changed considerably over the last 15 years. SD is now considered one of the handful of U.S. “glamour cities,” for better or worse. That’s why I think prices may not go down here as much as some think (or would like), although I still think there’s a long way to the bottom from here, like another 20%-25% or so, depending of course on how you’re measuring where we are (which is a different topic entirely). But I don’t think we’ll see properties changing hands at 10x rental equivalents. The bar has been raised a bit over the last several years. I think we’ll see out-of-market buyers emerge once prices start to decline in earnest; wealthy buyers that either want to retire here or want a second home but are waiting for prices that aren’t completely insane. Having said all that, I still think the RE market is going to look and feel pretty ugly over the next few years.
