Prices won't really go down unless people are forced to sell.

That said, I have sympathy for the LinkedIn engineers who were holding all their stock for a down payment. That's gotta hurt.

Both kinds of demand could easily be clamped down upon by raising property taxes - the victims of which would be wealthy foreign investors and people who have sat on one of the largest increase in property values in history.

Likewise, supply could be increased if local government were at all interested in doing so just by building 10,000-20,000 low income apartments.

If the government announced both, the cost of San Francisco housing would plummet within days.

We have this problem in Boston right now. We're building and it's doing nothing to the rents because it's being snapped up by foreigners.

Also, sales are open record - you might look at buyers with Chinese surnames that lack Americanized first names.

We've been here before: back in the 80s, Japan was buying up most of the real, tangible assets in the U.S.

http://www.businessinsider.com/japans-eighties-america-buyin...

The cause was the same: strong export products, an undervalued currency, and easy-money policies. The first signs of trouble were the same: high inflation, crony capitalism, and poor transparency in the market. Let's see if the rest of history plays out the same way.