What I keep wondering is what impact falling prices will have on the long term holders of property. During the last five or six years the attitude has been, “Mom, don’t sell the house, it’s the greatest investment. I know it’s too big for you now that Dad is gone, but please keep the house. It’s a gold mine.” But now the attitude is probably going to change to, “Yeah, there really isn’t much point in continuing to live in the house now that Dad’s gone. If you want to sell it and move into a retirement center, go ahead and do it.”
The problem is that I have no idea how much this psychological shift will translate into an increase in the number of people who want to sell. I’ve been watching La Jolla for several years now, and I can tell you that there are lots of retired empty nesters still living in their houses. But how many will actually change their thinking and put their houses up for sale? Will it be just a couple or a bunch? No idea. I can see it going either way.
