The California press is also digesting the latest numbers. "Home-buying activity across California perked up in March but sales lagged behind the record pace of a year ago and price appreciation continued softening. Inventory is still expected to outpace the levels of the past two years."

"Realtor Mike Somers said the supply buildup is prompting some of his sellers to reduce their asking price. For example, he initially listed an 1,800-square-foot home in Winnetka for $619,950 but didn't get too much action. The would-be seller soon dropped the price to $599,950, then on Monday reduced it to $589,950."

"'The inventory is up substantially. With that much more to choose from, common sense says prices will level out a bit,' he said."

"'A lot of people are just kicking the tires right now,' said Jack Kyser, chief economist with the Los Angeles County Economic Development Corp. 'They're trying to figure out what's going on with the market, whether it's still going up or whether they should wait to buy.'"

"With prices like $682,500 in Norco, $612,500 in San Dimas, $610,000 in Upland, $570,000 in Chino Hills and $567,500 in Diamond Bar, it's pretty clear that Southern California's 'affordable alternative' is no longer as affordable. 'Affordable housing now means the High Desert, places like Victorville and Apple Valley,' Kyser said. 'In Los Angeles County, it means the High Desert around Lancaster and Palmdale.'"

There is a slowdown in San Diego. "San Diego County builders took out 41 percent fewer housing permits in the first three months of the year compared with the same period last year, putting the area on track to have the lowest output of new housing in 10 years."

"Typically, the first quarter in San Diego County represents 25 percent to 32 percent of all building permits for the year. If 2006 follows that pattern, then homes permitted for the year might fall between 8,900 and 11,400 units, the lowest since 6,868 were approved in 1996, at the end of the last real estate market downturn."

"Besides cutting production, San Diego area builders have begun offering incentives to would-be buyers. The inducements range from pitches for free homeowner association dues until next year at Verano La Jolla to $20,000 incentives to buyers at Treviso, an attached-home community in Santee."

"Newspaper advertisements carry tell-tale code words that signal the softening market: 'spring clearance' (there are deals to be made), 'immediate move-ins' (the home is finished), and '4 percent broker co-op on select units' (real estate agents are welcome). The most prevalent incentives, said one analyst, are rebates of $7,500 to $10,000."

"When sales are brisk, it's a lot easier to make a living in real estate. But when inventory grows, part-timers and newcomers are often the first to find another career. Veteran real estate professionals expect that many newcomers to the business will seek out easier ways to make money."

"'When the market is hot, agents come out of the woodwork,' says Diana Lusk, a San Diego, Calif., real estate practitioner. 'When the market cools down they go back to what they were doing before.'"