That's precisely what Ron Paul said & I agree.
Here in Sacramento, we have an additional problem with our housing market. Thirty percent of the people in our area work for the State, and the State of California is failing, laying off people in record numbers. So, in addition to the all the other economic woes both for California in general and for the country, we have that added weight pulling things down.
We went to a July 4th barbeque last year at some friends' house. They live on a cul de sac and of the roughly ten homes in sight of their house, four were already foreclosures -- and that was a year ago.
It's a hard time and the new normal will not have that much upside. FWIW, if you can get out even you're way ahead of the game. The CA. mkt is toxic. The state is so poorly run jobs and population are leaving and the schools are declining.
Financially the state is a mess and the govt is run by the unions so don't expect any real reform.