Winter Is Coming
Will you be ready?
The view took my breath away. The apartment was on the top floor of a building at the corner of 3rd and Folsom, with a killer sunset view looking straight out over Twin Peaks. The fog started to roll in, as I felt the cool breeze on my face. I could already imagine the parties I’d be throwing.
“If you take the apartment today,” the agent said, “I’ll give it to you for a $99 security deposit. And I’ll drop the price to $1100 a month.”
“Sold.” I said. I didn’t have a job yet so I needed to preserve cash.
The agent breathed a sight of relief. “You know, you got a great deal, during the boom, this place rented for over $3,000 a month.”
We both chuckled. Who would ever pay such prices? What irrational thinking!
It was 2002. By 2012 the apartment was renting for over $3k a month.
By then we’d saved enough during those low rent years to buy a small place. So here we are. We feel for everyone renting right now.
If you arrived in San Francisco any time since about 2008, you may have a hard time imagining the wasteland that was San Francisco during the bust. Perhaps the best way to illustrate that would be to tell you I could drive to the South Bay on 280 in 45 minutes at the height of rush hour.
If you’ve only ever seen San Francisco in the last few years: eating at gourmet restaurants, scotch tasting, premium coffee, all the food you can eat, and experiencing endless recruiting opportunities; you’ve been living in the Summer.
But Winter is Coming. Pretty much every major reputable financial indicator says so.
How to Prepare for Winter
- Stockpile. Those who can invest in a downturn stand to profit handsomely. If you can take a job at a lower paying startup during this time it may be a better option for you career wise. Otherwise you may be forced to leave the Bay Area as so many others did in 2001.
- Build your army. Stay in touch, authentically with the people who can help you. You don’t always know who that will be; so remember: Life is Long and the Valley Is Small. Here’s a good primer on one way to do networking.
- Find safe havens. Consider your investment portfolios. Either prepare to hold for several years or lock in your gains now, or a little of both.
- Sharpen your Sword. What skills do you need to have to stand out from the pack if the weather got cold tomorrow? Get started.
- Appreciate the Summer. For you don’t know how long it will last.
