Judging by the state of the present economy and viewing all of the available information re. the number of homes that have already been foreclosed, plus the likely future foreclosures from ARM resets over the next several years, etc, we may be looking at 1998 prices before the bottom is found. And I don’t meant 1998 plus any allowance for inflation. Inflation follows no rules or boundaries when it comes to bursting, housing bubbles. The measure will be the availability of loans, mortgage rates, number of qualified buyers in a given market, etc.
A good example of what could happen in San Diego is occurring right now is southern Florida (and other parts of FL, as well).
http://piggington.com/florida_luxury_home_market_shows_signs_of_wear

It’s your money…………………………… but if you fall for the hype that the housing market may be close to the bottom in 2009 and that you will only overpay by around 10%, you are seriously deluding yourselves and you’ll be paying all of that overpriced housing money back to the bank plus interest for a long time.