January 4, 2007 at 9:43 AM #8158daney143Participant
How is San Diego going to deal with the increase in internal growth? Although more people left San Diego last year than migrated here, the birth rate of the county continues to rise. Not to mention the growth of undocumented people. This means that we can’t measure our growth through migration anymore because the majority of the county’s population is going to come from within.
I get this felling as long as housing doesn’t keep up with internal growth, housing in this city will always be over priced, because, just like in China, it will take a smaller percent of the population to maintain the market because of the lack of inventory. Although only 8 or 10% of SD can afford a single family home here. Maybe 270,000 people (9% of the population of San Diego County) is enough to keep the market going in a strange way. Yeah, that 270,000 will focus on buying a SFH before they think about getting into a condo. So where does that leave things? See you later condo conversions and downtown SD.
The thing I believe people need to keep in mind is the scale of the economy and the fact that this world, globally is venturing down a path that it has never been down before. The fact that we are reaching a global population that is unsustainable and the sad American mentality of old where we all get a little piece just won’t exist anymore. This housing bust/boom is the start of a harder life for us here in the USA. So my feeling is that you can take all you economic models and throw them out the door and focus on the reality of hard times ahead. Just face it, there is going to be an American generation at some point that just won’t have what their parents had (we could be it).
So keep worrying about the percent of the housing deflation and how much it’s going to fall.. Even if the median home prices falls to $375k, it doesn’t mean that it will be any more affordable for you or I because we’ll probably be one without a job and we’ll have bigger things to worry about. I can’t wait until this blog site turns into a, why is America outsourcing all it’s agriculture to other countries and now, just like the middle east has done with oil, south America is doing it to us with food. Where is the bacon mom? Or why is Milk $22 a gallon mom?January 4, 2007 at 5:25 PM #42723poorgradstudentParticipant
Some interesting points, although I disagree with you on a lot of your conclusions.
The US has one of the highest birth rates of any industrialized country, largely due to immigration. It’s quite hard to project how those trends will continue or change in the near and distant future. It’s well documented that recent immigrants have more children than 2nd, 3rd, etc generation citizens of industrialized nations.
If San Diego’s growth does come from immigrants, it’s unlikely they’re going to drive up housing prices. Stereotypically they’re willing to live in much denser homes, and aren’t usually going to make the kind of incomes to afford homes. Also, in the case of illegals, they’re not going to be able to have the paperwork to get the big loans needed.
If 9% of individuals can afford the median home, it doesn’t necessarily mean only 9% own. 50% of homes cost less than the median, and you’d imagine that those are being bought by people below the median income. Still a problem, but not QUITE as dire as 8-10% makes it sound.
Agriculture and entertainment are two industries the United states has huge advantages in and is unlikely to outsource. The reality is the US has a low population density for an industrialized nation (Easy to forget when you live on the California Coast, but when you’re from the midwest you know what most of the country looks like). We have a lot of arable land, and as a consequence have some of the cheapest food in the world. The government actually buys excess dairy products to prop up the price to keep farms in buisiness. There’s a cost factor too: with the rising price of oil, transporting food long distances isn’t very practical.
I tend to believe the economy drives housing, and not the other way around. I also believe in cycles. We’re headed for a downcycle, though the exact timing is tough to predict. Regardless, we’re living in the richest period of history to date, and it’s hard to imagine that technology won’t continue improving.January 4, 2007 at 5:42 PM #42725blahblahblahParticipant
We also have the some of the best agricultural technology in the world. That’s one of the reasons we have so many illegals, when NAFTA passed, Mexico got flooded with our cheap produce and it put all of their farmers out of work. Now they’re bussing tables at Applebee’s.January 4, 2007 at 7:45 PM #42730PerryChaseParticipant
If our agriculture weren’t so good we wouldn’t be so fat and our health care cost might but not be so high. On that note, I wonder what the Iraqis eat. The Iraqi people we see on TV are pretty chubby for a country at war.
Pretty much all industries in the America economy have undergone great changes. Houses, however are still built the same way they were 50 year ago. If we have better technology (standardization, manufacturing, assembly, etc..) then housing prices could be held in check.January 4, 2007 at 8:51 PM #42731TheBreezeParticipant
I wouldn’t be concerned about a food shortage any time soon. The U.S. government, through the Conservation Reserve Program (CRP), pays many, many farmers to hold their land in reserve. This land can only be used to grow diffeent types of grasses. No livestock can graze on the grass and the grass cannot be cut and fed to livestock.
I’m from the Midwest and know several people that participate in this plan. I would estimate that there are at least 1000 acres of this land within a 10 square-mile radius of my parents’ house — and that’s just the CRP land that I know about. I don’t know how many acres are in the CRP plan, but I wouldn’t doubt if it is in the millions. Couple the CRP land with the fact that most fatass Americans eat about 3x as much as they should, and you have a population that is a long way from facing a food shortage.
By the way, things may seem crowded here, but in the rural Midwest, things are a little different. You can drive miles on I-70 in Kansas and not see a house. In many places, if you exit the interstate, you end up on a dirt road in short order. If you want space, move to the Midwest.January 5, 2007 at 7:05 AM #42746blahblahblahParticipant
Having the best agricultural technology simply means that we can produce food more cheaply and in larger quantities than just about anyone. That said, if you want to eat healthy food here in the US, you’ve got plenty of choices. Of course this is a free country, so if you want to eat unhealthy food, that’s your call too. I’m not a big fan of mass-produced US beef, but it is cheap and there’s something to be said for a country of 300 million (!) people where almost everyone can eat a hamburger whenever they want. Not that eating hamburgers is good for you, I’m just saying we’ve made them really, really cheap, so I wouldn’t worry about losing our food supply to foreign imports.
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