Wednesday, August 29, 2007

Over-valued real estate #19 - San Franscisco

San Francisco started enjoying a bubble before most cities. Things took off in the mid-1990s and got a little out of hand with the internet bubble. Prices calmed down after the dot.coms exploded, but accelerated after the Fed started to cut interest rates. Over the last year or so, prices have been increasing almost vertically. However, San Francisco has been through it before. The 1980s bubble finally burst in 1989, and prices fell for about five straight years.

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