San Diego was the first city in CA to see double digit price gains, and is considered by one national housing analyst the “canary in the coal mine”. I read this in various articles, too, that SD is the city to watch, since it had the run-up in prices first. The thinking is that if other CA cities are overvalued also, they will follow the trail of San Diego. So basically, what is happening here, will happen in LA, SF, OC…, delayed as long as was the run-up. So if your double digit appreciation lagged ours by 1 years, so will your downturn lag by 1 year.
UCLA Anderson Forecast said Orange County will get hit hardest, because of the high employment base of exotic lending, and there will be massive layoffs in that industry.