New IPO Rich

There will be over 10,000 newly minted millionaires this year in the Bay Area, assuming at least half of the major IPOs that are scheduled to happen happen. Uber, AirBnB, Lyft, Pinterest, Slack, and Postmates are all set to go public, converting hundreds of billions in paper gains into real money. That money will need to go somewhere, and no better place than houses. This article is the talk of the town in the real estate world, with brokers everywhere not so subtly mentioning, “so uh… did you see the article?” expecting everyone that is on the fence to jump into the market before the new rich kids start buying. I’m not sure how big of an impact it will actually have, but it seems hard to me to find the catalyst for home prices to cool off here. Which means I could easily regret renting a new place this month instead of buying… call me in a few years and remind me that I wrote this. Marina homes are trading at ~$1,200/sf, so seeing a 1000sf 1br/1ba condo going for $2.4mm in a few years seems crazy, but then again so did $1.2mm not too long ago and here we are.