While Tom at The Real Estate Bloggers is certainly correct that it's very, very difficult to add new housing inventory to the San Francisco market (which may well be why we have high-rises on the brain lately), we think he's overestimating the corresponding insulation from a housing price downturn. Partial insulation, surely—but there many more factors to be considered. One that springs to mind is the new world of securing loans. Institutions are being far more—perhaps even overly—responsible with loan products and the lending of such. Fewer buyers with less money to spend doesn't sound like a recipe for appreciation or even treading water.
We'd like to be optimistic and agree with TREBs that prices won't drop significantly overall (particularly with a place on slated for market shortly). Sadly, our sunglasses are not rose-colored. A realistic goal on an individual level is probably modest appreciation, earned with a lot of time and effort. But on a market basis? You tell us: what do you sharp folks see as the most significant defining factors for housing prices as the market continues to transition?
· Why Housing Prices in San Francisco Will Always Remain High [The Real Estate Bloggers]
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