ARMs are only .01% of the SD market, but they are 50% of the resale market, and the resale market sets the price for all homes. So the 30,000 homes sold in San Diego this year set the price for the other 1 million homes that are not for sale.

It doesn’t matter if the other 1 million have their homes paid off.

See powayseller’s explanation at this post, 3/4 of the way down.