San Francisco has been a boom and bust town since the beginning, with countless "doom loop" stories. The reality is that it's a desirable city. If we're in a true bust, prices will begin to drop--and those places are quickly filled up with people who can now afford to live here (again). We're not witnessing a drop in demand per se, we're witnessing a decreased demand at the high-end (this is a good thing! it's run out of control for the last decade.) combined with commercial real estate investment that won't lower leases because it devalues their properties and puts their RE investment underwater. (Ultimately, their hands will be forced, of course, which will lead to much lower cost commercial real estate in a highly desirable city with better affordability for homes... again, this is a good thing.)
The problem in Detroit was there was no price low enough to get people to live there when there were so many places with similar amenities and better quality of life nearby. In SF, the second housing prices fall, they're scooped up instantly. People move across the country/world to live in SF even when the job market has been terrible in the past. (There's a lot more to SF than a job.) I'm not saying San Francisco could never fall, but we're nowhere near that reality.
While I think the people who think this is a good thing are out of their minds, Detroit had entirely different issues, and probably is not a good example for what could happen to SF in the worst case.
1. Detroit has none of the natural advantages SF does.
2. Detroit was hollowed out largely because of the white flight that drove the tax base to the suburbs.
3. Detroit was uniquely built as a highly car friendly city, which meant that once the jobs were gone, there was no good reason to be within Detroit itself.
4. Detroit had no political power at the state level, and if anything, was held up as a punching bag for the rest of the state. This is unlikely to be the case for SF, which is likely to have political support at all levels.
I'd say the worst case scenario for SF is probably a city like Philadelphia, which also went through bad years, but has rebounded and has become a pretty great city in many ways, even if it doesn't have the cachet of its past. And I'd imagine that would be the worst case scenario for SF, and the more likely case would be something much better than that, even if all the wealthiest people left SF.
Exactly. The reality is that San Francisco has lost a lot of people over the last decade, even though our population has grown. We've displaced people through a crisis of (lack of) affordability as wealthier folks have flocked to the city. If we view SF's success purely through population growth, that looks like success, but in practice, it has been a truly devastating decade for so many who loved this city. The demand to live in the city may be just as high today, but the demographics may look less rich. As housing prices slowly come back down to something vaguely closer to earth, some of those people come back -- and new residents eager to take advantage of the quality of life SF offers at a lower price point move in. It's a cycle that's a microcosm of American boom/bust mentality, but SF always comes through with being a beautiful/unique/storied/creative/walkable/dense city.
The problem in Detroit was there was no price low enough to get people to live there when there were so many places with similar amenities and better quality of life nearby. In SF, the second housing prices fall, they're scooped up instantly. People move across the country/world to live in SF even when the job market has been terrible in the past. (There's a lot more to SF than a job.) I'm not saying San Francisco could never fall, but we're nowhere near that reality.