The Bay Area, and especially the Peninsula real estate market is so strong that it takes 2 or 3 events to cause it to stop appreciating, and in some areas and locations go down. Currently, we are 7 years into the normal 7-10 year long-term real estate cycle and the appreciation phase may be ending for the cycle. The mortgage correction is happening. Oil is skyrocketing. The dollar is falling. The economy is stalling. In other words, there are enough negative events happening to turn the market if they persist.
I am always surprised when others are surprised about real estate values potentially going down. Like any appreciating asset, real estate goes up and down as it appreciates over a long-term seven year cycle. The current cycle began in 2000 and will end…???…soon I believe.
Hope you all had a happy Thanksgiving! We have much to be thankful for- especially having the opportunity to live in an area with the climate, geographic and cultural attractions, and economy that the Bay Area has. This ain’t Detroit folks!
- Jeff Stricker
