by Calculated Risk on 7/17/2006 03:26:00 AM

David Streitfeld writes in the LA Times: For San Diego Real Estate, the Skies Are Not So Sunny. Excerpts:

San Diego had the wildest run-up among major California cities, with prices tripling since the mid-1990s. ... The market also began to fade first in San Diego. ...

Whatever happens here, optimists and pessimists agree, will happen later in the rest of the state.

That's about the only thing everyone agrees on. The size of the coming hangover is a particularly contentious matter.

Most analysts and people in the real estate industry insist it will be mild. The housing bears say the bulls are either misguided, uninformed or shills.

Streitfeld relates some positive comments from a local real estate broker and then notes:

... the fliers taped to the window outside the office door tell a different story. "Huge Price Reduction," one says. Another says both "Reduced" and "$15,000 Credit."

In some cases, the prices are dropping faster than the fliers can be reprinted.

A two-bedroom town home has its price of $324,900 crossed out with a marking pen, replaced by $309,900. Another house, a four-bedroom in suburban La Mesa, has a printed price of $575,000.

Below that is handwritten $549,000.

Scribbled below that is a new minimum: $499,000.

I believe this is just the beginning.