My wife and I over the past year have been keeping an eye on two different price points (Mira Mesa / Clairemont vs. Del Cerro / Mt. Helix). The first areas are in a price-range that is very easily affordable and the second areas would be at our upper limit. Although we definitely like Del Cerro and Mt. Helix better, we are leaning more and more to getting a house in Mira Mesa or Clairemont especially as housing costs with 20% down there approach rents.

We would be happy in either area but feel that by buying at the lower price point next year where prices are closer to fundamental levels, we would be protecting ourselves from large possible price declines in the higher end areas. If prices do come down significantly in the nicer area, we could rent out the Mira Mesa / Clairemont house, and then buy in one of the nicer areas. If prices don’t come down significantly in the nicer areas, we could evaluate from there to see if it is worth it to pay the prices that are being asked for those areas.

So, in response to the OP, it seems that we are less likely to splurge for housing.