If homes in my neighborhood (which rent very very quickly) dropped to 1998 prices they would be cash positive by more than $1000 per month based upon current rents. At 2000 prices they would be cash flow positive by more than $500 per month.

The thing is, by the time they drop to 2000 prices, rents will drop as well. They will be dragged down by local recession and massive oversupply of housing. Your lawyer/exec buddies will contribute to that by buying properties and putting them on the market.

If you wait for it to get to 650-700, then someone else will own it instead of you. If you like it at this price, get it. Chances are it won’t drop down to those levels.

Let’s put it very simply.
The only reason to get it now for 800 is if you believe that
1) Encinitas as a whole is not going to drop to 800
2) this is the last good deal before the rebound