The Union Tribune reports on the San Diego housing bubble. "San Diego County's housing market was a quiet place last month as prices slipped in some areas and settled to an overall median of $505,000, DataQuick reported. The figure, off the all-time peak of $518,000 set in November, was only $1,000 more than in March and up just 4.3 percent from a year ago."

"Resale houses and condos both had a dip of $5,000 in their medians from March to $555,000 and $395,000, respectively. More telling were sales totals, down 30.7 percent from April 2005 to 3,705 transactions, marking the steepest year-over-year drop since activity began sagging in mid-2004."

"While sales were off sharply, the San Diego Association of Realtors reported a continuing surge in listings. That number stood at 18,225, which was 75 percent ahead of last year's level. More than 35 percent of the listings carried prices that had been reduced from the original price."

"Ross Starr, an economist at the University of California San Diego, said yesterday's increase in short-term interest rates announced by the Federal Reserve means that buyers will be inclined to take out 30-year loans and settle for little if any appreciation for the foreseeable future."

"'It is shocking to say that houses are places that you live in, not places that you trade like Monopoly cards,' Starr said, adding a caution forgotten by many in recent years: 'It is not a universal law of nature that real estate prices go up.'"

"Kristian Cabuago hopes to spend his first night in the first home of his own, a 950-square-foot top-floor condo in the Gaslamp Quarter. It cost him $550,000 and he thinks he timed his purchase just right when he signed a sales contract earlier this year. 'At that time the news was forecasting condos in downtown and everywhere were suffering,' Cabuago said. 'I thought that was a perfect time to buy.'"

"He negotiated the price down from $591,000. and considered it a bonus that his homeowner association fees will be $250. 'For my age group, there's no way I can lose,' he said. 'You can't ask for more.'"

"As for sellers, they're pestering their agents to schedule more open houses, advertise more to attract potential buyers and take all available steps to get their properties moving. After a few weeks, many take their agents' advice and cut prices."

"Peter Dennehy, who advises builders on how to position their projects, said many are boosting incentives, reducing prices and expecting it to take longer to sell out. But would-be buyers can't sell their homes fast enough, sales manager Pat Setter said, to commit to buy at Bougainvillea Walk project in La Mesa, where all 16 homes are completed but only seven have been sold. 'That's our biggest issue for prospective buyers,' she said."

"Prices range from $583,990 to $690,990 for 1,911 to 2,093 square feet, and a project sign was recently changed to reflect lower prices, but that was because some homes offered were on less-desirable lots, Setter said. Of more than 90 ZIP codes in the county, all but nine posted median prices last month that were lower than their peaks set in the last few months, according to DataQuick."

"Jan Havern, who is trying to sell her 3,900-square-foot house for between $900,000 and $1,050,000. The home on Vista Arroyo has been on the market 45 days with no offers submitted to date. 'I'm as nervous as anybody else since I'm trying to sell,' she said, adding that she and her husband have already bought a replacement home in Bend, Ore."

"Her advice to fellow sellers: 'They have to sit tight and maybe take a little longer,' she said. 'You've got to be realistic.'"