Obviously the lower end houses are going to be hit HARD. To estimate how far they will drop, just go back to 1999-2001 timeframe and see what they sold for, then adjust for inflation. This is a rough starting point.
The bottom line, any house selling for 400K in San Diego today is either a condo or a single family house in the ghetto. Once inverstors are out of the picture (happening now), and later when the lenders stop offering exotic mortgages (going to happen shortly), there will be nobody willing or able to pay this much to live in a crap hole.
Ultimately prices of lower end properties will have to be based on actual income because there will be no significant investor influence to create false demand. If the median household income is 63K, this qualifies you to pay around 200K more or less.
