Sdrealtor, you’re absolutely right that San Diego is historically a leader rather than a follower in the pricing trend. History also bears out most metropolitan areas move more or less together over time. We will have to see which historical precedent wins in this case. I think the strength of the national downturn will trump this time.
Also the median sales price and the case shiller index (to a slightly lesser extent) are sometimes exaggerated by market conditions. The peak of 2005, for example, was overstated upward due to a lack of sales at the lower end. Similarly, the low of 2009 was overstated downward due to both a lack of sales at the higher end and the high volume of sales of inexpensive garbage on the lower end.
A normalized market (historically normal amount of sales among all tiers of housing) “only” returning to the 2009 lows would still be a significantly lower market overall.
