Think of it this way. You want to buy a house, and so do x number of other people. You also know what you can reasonably afford, as do others. When a market is in decline you gravitate towards the best area you can afford. Areas worse off in terms of general desirability have to “compete harder” to attract buyers. In simple terms those areas need to lower their prices ever more in order to pull in buyers.
At a certain point when prices have fallen a large enough percentage, buyers stop considering these lesser areas altogether, regardless of price. This also assumes that the buyer pool has shrunk enough that not all units can find a buyer at almost any price.
If they can afford Del Mar, CV probably isn’t really an option at that point. Then the competition is between a much smaller group of sellers for a particular buyer.
