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CoronitaParticipantI don’t think dz’s problem started out with lack of affordability. It seems like more extreme self inflicted pessimism and self imposed sky is falling that resulted hesitation to buy when things were affordable…and subsequently missing the boat…. at this point, I would probably wait for a correction too, or if doesn’t happen, move to Utah.
CoronitaParticipant[quote=deadzone][quote=Coronita]
Who cares. For some there’s little to low mortgage. And for the others they are locked into a historical 30 year between 3-4%….during that 30 years they have the opportunity of arbitraging their money elsewhere while not worrying significantly about higher living costs especially with inflation..it probably would cost them close to the same monthly to rent, if not more. I don’t envy people trying to find a rental close to Sorrento Valley, especially if some of them now need to return back to work in a hybrid model. There’s close no inventory for purchase or rent. And even rentals are ending up in a bidding war. Too bad I can’t convince myself to be a dick landlord or I’d be jacking up rent every year.[/quote]
Outside of your own selfish/greedy interests, don’t you think society would be better off with more affordable housing, less inflation, more affordable education, less reliance on debt, etc.?
SDR is always whining about the current runaway inflation as if it is a bad thing. Well the solution to inflation is to let the bubble pop and market crash/correct.[/quote]Yes, I do think more affordable housing would be nice. but that’s not my problem to solve, that’s government and builders problem. also, Debt is part of our America culture that will never change, but there is a difference between good debt and bad debt imho.
Also, I don’t think their is anything wrong with tech people getting compensated well for the work they do, especially if it encourages more people in this country to spend the time and energy to be in STEMs. And for those that choose not to, that’s also not my problem to solve….the only thing I can do is to support people young and up and coming in my field so they can have better opportunities than we did….so I spend both time and money l, some of my rental income, to support robotics andscience STEM funds. more money than most single corporate grants from 1 large company, that typically only donated a few hundred or low thousand per fund/team…. If it grows the next generation of highly skilled technical people, that’s good for the next generation of youth who will have better opportunity than us, and good for our country who have more qualified domestic workers..
If other people in different professions are getting left behind that’s someone else’s problem to solve.
CoronitaParticipant[quote=deadzone][quote=an][quote=deadzone]And yet you keep deflecting the fact that RE is on fire all over the country. Do you really believe that San Diego is somehow immune to the bubble bursting? Yet so much of the wealth and RE gains in San Diego are a direct result of the bubble inflating?[/quote]
So, when do you expect this bubble to pop like 2008?[/quote]Who knows when it will pop. But a hell of a lot of signals are pointing to the fact that it is leaking serious oil, right now. If you can’t see them you are blind.
Fed publicly stating since Nov that they will begin tightening their balance sheet and raise interest rates starting in March. Large public RE companies getting absolutely ass pounded in the markets. I tried to point out Zillow but the usual excuses that the problem was isolated to Zillow, as if they don’t know what they are doing. Well obviously that’s bullshit. I told you guys to watch out that their competitors would soon follow. Today Redfin and Opendoor both set 52 week low in the stock market. Investors are sure seeing the end of housing bubble.
So the signals are there and they keep getting stronger.[/quote]
Who cares. For some there’s little to low mortgage. And for the others they are locked into a historical 30 year between 3-4%….during that 30 years they have the opportunity of arbitraging their money elsewhere while not worrying significantly about higher living costs especially with inflation..it probably would cost them close to the same monthly to rent, if not more. I don’t envy people trying to find a rental close to Sorrento Valley, especially if some of them now need to return back to work in a hybrid model. There’s close no inventory for purchase or rent. And even rentals are ending up in a bidding war. Too bad I can’t convince myself to be a dick landlord or I’d be jacking up rent every year.
CoronitaParticipant[quote=deadzone]And yet you keep deflecting the fact that RE is on fire all over the country. Do you really believe that San Diego is somehow immune to the bubble bursting? Yet so much of the wealth and RE gains in San Diego are a direct result of the bubble inflating?[/quote]
I don’t think there is a bubble. There’s an unfavorable pricing issue for those that chose to sit out buying …. if there is any downturn some people will have a hard time paying their mortgage. But I think there will be plenty of other people to take their place….unless we have a huge meltdown….but then if that happens, I doubt you would be able to take advantage of it since you would probably be unemployed just like everyone else.
CoronitaParticipant[quote=deadzone]And yet real estate has been and continues to be on fire throughout the US since Covid. In some cities more so than San Diego. This suggests that Covid policy (i.e. Fed money printing) is a far larger influence on this red hot RE market than the so called “unicorn” companies in San Diego. I’m not suggesting that SD isn’t growing and in better position than many other cities. But let’s be realistic here. The Covid market is on fire due to Covid policies.[/quote]
So now you’re deflecting and arguing SD housing demand isnt growing due to job expansion despite what reports says about job expansion in SD.
Interesting.
Um ok.
I’m really curious though… If you’re expecting a lot of higher compensated people suddenly are jobless , what makes you think you won’t be and would be in a better financial situation then them.
CoronitaParticipant[quote=an][quote=Coronita][quote=sdrealtor]https://sandiegolifechanging.org/blog/unicorns-are-real-san-diego-startups-to-watch/[/quote]
I didn’t know ShieldAi and Drata are unicorns. Oops. Interesting . I know a couple old colleagues from Carlsbad tech community went to both when they were still in their Series A, some ex-GoPro folks too.
Seismic is also on that list. They’ve been around for some time. I think one of my old neighbors was a founding member ….I forget what they do.
ClickUp was one of the Bay Area startup that moved here to SD.
I think also Kandji is close on this list. They got their Series C round of investment back in November. $100m or something like that. Mac OSX MDM player.
Kandji pulls in $100M Series C on $800M valuation, up 10x since last year
It will be interesting to see if Apple buys them or squeezes them out. I think the latter since Apple does that to small companies.
Show me.the money.[/quote]
Yep, Drata is blowing up quick! Their ARR growth is phenomenal. Between them and ClickUp, I think they’ll be big for the San Diego scene. Not to mention Apple, Amazon, and Google are all hiring here with the first 2 is dramatically hiring. I know Amazon is trying to poach from Intuit and Apple from QCOM. Will be fun to watch from the sideline as they push up the SD’s salary band.[/quote]
….and housing and rental costs…CoronitaParticipant[quote=sdrealtor]https://sandiegolifechanging.org/blog/unicorns-are-real-san-diego-startups-to-watch/[/quote]
I didn’t know ShieldAi and Drata are unicorns. Oops. Interesting . I know a couple old colleagues from Carlsbad tech community went to both when they were still in their Series A, some ex-GoPro folks too.
Seismic is also on that list. They’ve been around for some time. I think one of my old neighbors was a founding member ….I forget what they do.
ClickUp was one of the Bay Area startup that moved here to SD.
I think also Kandji is close on this list. They got their Series C round of investment back in November. $100m or something like that. Mac OSX MDM player.
Kandji pulls in $100M Series C on $800M valuation, up 10x since last year
It will be interesting to see if Apple buys them or squeezes them out. I think the latter since Apple does that to small companies.
Show me.the money.
CoronitaParticipantOh my god. This is hysterical….
CoronitaParticipant[quote=deadzone]Regarding commercial real estate, since we are focusing on Tech industry in this thread why don’t we watch Qualcomm as a barometer since they are the largest tech company in San Diego.
So what are their plans for bringing employees back to the office? Or if they are seriously going full remote on permanent basis, then they should be jettisoning a lot of their office space. Is this happening? Anyone know?[/quote]
It’s hybrid. 2-3 days at work, exceptions can be made. Qualcomm never had plans to go full remote…ever…
Again, you are arguing with yourself here in cirles. Not sure what you are trying to get at.
Are you saying because a bunch of Qualcomm people are going back to the office, the demand for real estate here will suddenly drop off?
If so, that makes no sense.Whether Qualcomm is going back to the office or not doesn’t matter. Qualcomm is based here SD. so if people need to work in the office, they need a home here SD. If they were working remote, they still need a home here in SD. So how is Qualcomm being fully remote or hybrid or fully on office matter to the local SD housing market?
The only difference would be a employer not based here in San Diego allowing people to work anywhere.Like tenant that signed a 2 year lease. Both are in marketing and work remote. She has to show up every so often to either the satellite office in OldTown or meet quarterly in LA. But other tha that they will stay down here and send their kids to school on DelMarUnified for $5000/month for 2800 sqft versus previously spending $5000/month for a 2/2 apt in Culver City with Culver City schools…
So, there are some transplants.And there’s a lot of job growth here in SD where new people have new high paid biotech/life sciences job..That also means people need housing.
So why does.a few large companies saying they are doing a hybrid model make a signficant difference in the SD housing demand?
There appears to be 3 different categories of people living and working here and the remote workers is only one of those 3.
BTW: hybird model works if the job is in LA or OC. If one only.needs.to show up for work 1-2 days, so.e people dont mind taking the coaster to OC for example. I had a patent attorney friend that did that years ago…
CoronitaParticipantThanks for sending the report… So what a lot of us has been saying is true….San Diego has significant job growth in tech and life sciences… Not that I doubted it…
CoronitaParticipant[quote=sdrealtor]The vacant office space in SD is predominantly downtown. Suburban office space is doing much better[/quote]
I’m guessing most of us don’t understand how commercial RE works…
It’s not a simple, well a lot more people are working from home, so offices must be closing or vacant….
Sounds to me that there are a lot more jobs here in SD now, whether it’s remote or not remote.
Which is why I don’t understand’s DZ’s facination with some companies are now asking people to return back to the office in San Diego thinking that will cause real estate to crash by itself….
If we did have job growth in SD and a good portion is in life sciences and biotech, then lot more people now earn a lot more in SD….since I don’t know too many biotech scientists that are paid peanuts ..
CoronitaParticipant[quote=deadzone]
Again, show me examples of large companies selling off all their office space and property and I’ll believe they are going fully remote permanently.[/quote]Um… Most companies don’t own their own offices anymore but….
https://www.globest.com/2021/09/20/san-diego-office-vacancy-heads-up-again/
“San Diego Office Vacancy Heads Up, Again
In the second quarter, office availability grew 30 basis points to 20.7%, the highest since 2011.”BUT….If you read the article though. life sciences/biotech is one area where there’s huge demand.
And it probably makes sense. Life sciences/biotech usually requires an onsite lab facility. It’s not conducive to work at home…. .
“While tech and life science companies aren’t saving the market, they are driving the bulk of the leasing activity, thanks in large part to venture capital investment. In fact, demand for lab space increased 280% since March 2020 and office demand has already surpassed pre-COVID levels, according to research from JLL. This will likely support most office leasing activity and help to improve the metrics into 2022. According to JLL’s Tim Olson, senior managing director, the demand is driving both leasing and investment activity in the market.”
And we do know that here in San Diego, the investments in life sciences and biotech has been significantly expanding. $2.5 billion invested in San Diego.
https://www.costar.com/article/1595642948/biotech-investment-is-booming-in-san-diego
Here’s another article about how demand for life science facilities is actually in short supply…
Biotech Firms in Hot Race for Space – Demand Outstripping Supply in San Diego, Other Top Markets
“emand for new life sciences space is outpacing speculative construction among the top 12 U.S. life sciences hubs, including San Diego, according to a new report from CBRE.
Life sciences companies, rapidly expanding amid a race for new drug development, collectively sought nearly 23.8 million square feet of new laboratory space in those markets in the third quarter.
That exceeds the amount of lab space under spec construction – meaning space being built without a tenant already signed – by nearly 2.8 million square feet. The gap has widened steadily since last year – even as construction has ramped up considerably, growth in demand continues to outpace it.
The San Diego research and development lab vacancy rate currently sits at 2.2%, tighter than the Bay Area.”
So perhaps, simply put, none of us understands how the commercial real estate market works. Maybe not all commercial real estate is the same, and some buildings cannot simply be repurposed easily for the in-demand life sciences facilities….
It sure sounds like for SD, remote work friendly or not, that’s not entirely driving demand for housing locally. There might be a component to that. But it sure sounds in addition to that, there’s also a lot of companies setting up shop here in SD now… And maybe what we have is a perfect storm of both factors is why housing is in such short supply (that and builders not building enough)…
Speaking of heavy SD investment….it’s not just life sciences/biotech investments are pouring in….
https://www.sandiegouniontribune.com/business/story/2021-10-14/sd-fi-sandiego-venture-capital
“In rare twist, San Diego tech startups outmuscle life science firms for top money deals”
I mean, let’s think about this. When that new MM 3Roots community started taking waitlists for new home buyers, there were 14k+ people on a waitlist for 200 homes, and that’s before they stopped taking additional people on the wait list….
Think about that… That’s a 70:1 ratio….
How bad does the real estate market have to get to knock off demand when it’s a 70:1 ratioCoronitaParticipant[quote]
With real estate as valuable as it is why would anyone sell off all their real estate holdings?
But if you try sometime, you just might find you’ll get what you need.[/quote]
To move to Utah I guess. I look at my real estate as my retirement pension.
oh funny story sdr. Remember that tenant that cancelled his lease because he went on vacation for 2 months and didn’t want to pay rent while he was on vacation? He called me yesterday and asked if my place was still available. I was like dude,.I rented it out less than 10 days after you moved out for almost $300/month more, and there were like close 40 applicants… And then he went on a mini rant that he can’t find a anything 1/1 less than $2k/month and that single rooms in houses were going for $1500/month…. I was kinda dying laughing inside and tempted to say I “told ya so, you idiot, I was trying to talk you out of it for your own good” and rub it in…but I just kept to “well good luck to you finding something
….”I think if I were to bring each place to current market price for rent, I’d bring in about $10.8k/month , which a few years ago I would not have thought would be possible without purchasing 1+2 more rentals.. but I won’t be greedy and jack up rents unless..the next tenant that doesn’t want to pay for rent when he goes on vacation and moves out over it…lol
Interesting thing that also happened….One of my friends put a MM rental on the market…The rental turned into a bidding war. Where tenant prospects ended up paying above asking for rent. It ended up about $250/month than asking. I hadnt seen that except in the Bay Area rental market. Welcome to Bay Area housing dynamics.
CoronitaParticipantDay off from work again to post here, dz? Lol…
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