>>In my neighborhood a 1200 square foot house built in 1960, with termites, goes for over $900,000. SICK!!!
>
>That's insane... they sell realestate out there by the square inch!
>I remember a while back that the realestate market in south Flordia (Miami and such) tanked. Perhaps that will happen out there. I sort of *assumed* since the .com bubble-bust that maybe realestate out there had become more practical...I guess not. For 900K, pretty much anywhere else in the USA you'd get a dream house - not a 45 year old 1200 sq ft place...geeze.

It's already happening. Real estate prices have declined all over in the past six months, especially in the most hyperventilated markets like NYC, Boston, and the Bay Area. Sale prices down over 10%, time on the market up sharply.

Prices are still insane in the Bay Area. A friend in Sonoma who knows the market very well told me the house I bought here six months ago would have cost at least triple there, probably more. And it's not like I am living in downtown Detroit where I am. Insanity.