Some very solid points about the market in general, but I wonder how several of these points (particularly the points about oversupply, baby boomers, etc.) appl

Some very solid points about the market in general, but I wonder how several of these points (particularly the points about oversupply, baby boomers, etc.) apply to places like SF or Manhattan. SF, in particular, seems to be extremely young (though that could be observational bias on my part), well-monied, in sharp undersupply of housing, with rent matching or in some cases exceeding the cost of a mortgage. Historically, it's been a boom-and-bust sort of town as far as housing prices are concerned. And there are always places like the East Bay and the Peninsula to capture some of the demand. But it's not as if the Peninsula is cheap these days, so Oakland seems the more likely candidate to take on the burden (which then raises a thorny question of where all the low-income Oaklanders go when the gentrification accelerates). But it's conceivable that SF basically becomes the Mahattan of the Bay Area, a playground for the rich, while everyone else gets pushed into the outlying boroughs and beyond. In such a scenario, where money is little object to the buyers determined to own in SF, what happens to pricing? I don't know anyone who owns a home in SF right now who doesn't think the current prices are insane. (Anecdote: one friend just bought a condo in a new building, and three months later, the closing price for a lesser unit in the same building was $200k higher than what he'd paid for his). But are they actually going south anytime soon? Also: while mortgages and interest rates are great indicators for the housing market in general, SF seems to have an unusually large supply of cash buyers. In conclusion: I'm not disagreeing with the article, nor am I bullish on the local housing market. I don't fully understand why it's behaving the way it is, and that's never a great sign. But superficially, it seems to be the sort of "microclimate" that doesn't track the aggregate US market very closely. How many of these enclaves of wealth does the US have, or will it have, that seem to have a low to zero beta w/r/t the overall market? And if it's a significant amount, when will speaking in aggregate terms start to lose a bit of meaning? On a related note, I'd love to see a comparison of urban vs. rural vs. suburban areas across the US. I suspect that concentrated urban centers are obeying very different laws of physics, so to speak, than suburbs and semi-rurals with their huge tracts of overbuilt housing inventory. Example: I used to live in LA, and when the press spoke about how hard-hit LA was during the housing crash, they painted with a pretty big and sloppy brush. The surrounding areas (Inland Empire, etc.) got the plague, but housing in LA proper barely registered a slight cough.