A report from the Orange County Register in California. "Unaffordable home prices coupled with rising mortgage rates are expected to create 'a weaker housing market in 2019,' according to a statewide real estate industry group. A forecast by the California Association of Realtors estimates house sales across the state will fall to their lowest level since 2014. Buyers waiting for price drops, meanwhile, will be disappointed."

"The forecast marks a dramatic shift from the red-hot housing market of the past four years, which saw steady demand and price gains fueled by bidding wars. This year, however, the market shifted. California’s home sales, for example, have been down in five of the past eight months."

"Asked in an online poll last month if now is a good time to buy a home in California, 78 percent of respondents said no. Where are the buyers going? 'They’re on the sidelines waiting. They’re going to see what’s going to happen,' said CAR’s Chief Economist Leslie Appleton-Young."

"With fewer buyers, sellers are cutting their asking prices. Nearly 40 percent of California sellers reduced their asking prices in August. The median price drop was 4.3 percent. 'Would I call this a buyer’s market? No,' Appleton-Young said. 'But are we moving in that direction? Yes.'"

"Only one in four households will be able to afford the median-priced home in the Golden State, the forecast says. 'The low rates are what kept mortgage payments reasonable,' Appleton-Young said."

"With rates rising – hitting 7½-year highs on Thursday – more people are moving to more affordable parts of the state — or out of state entirely, CAR economists said."

"Twenty-nine percent of California home sellers this past spring moved out of state, up from 19 percent in 2013, a CAR survey of its members showed. More than a third of Southern California and Bay Area homebuyers moved to more affordable counties."

"'Where are people that leave Southern California going? They’re going inland, to the Inland Empire, and they’re going to other Western states,' Appleton-Young said. 'Where are people in the Inland Empire going? They’re going out of state. They’re going to Arizona and Texas.'"

"When will prices actually stop going up and start dropping?"

"'I think you’ll start to see some softening next year. I think we’ve already seen it at the upper ends of the market, … the $1 million and more properties,' Appleton-Young said. 'At the lower end of the market, I would expect people to start jumping in as they see more inventory and more concessions in price. We’re just not seeing it yet. The shift is in process.'"

The Mercury News. "Economists for the California Association of Realtors on Thursday offered a somber forecast for the state housing market in 2019, expecting rising interest rates and a lack of affordable housing to push more prospective buyers out of the market."

"'Home ownership is becoming a luxury good in California,' said CAR chief economist Leslie Appleton-Young. Across the Bay Area, the strong economy coupled with a lack of new housing has led to record prices. 'There is no quick fix.'"

"Although the market still favors sellers, economists also see signs it has begun to turn. About 40 percent of recent real estate listings have dropped prices this year, and homes have begun to spend a few more days on the market."

"Jeff Barnett, regional manager of Alain Pinel in Los Gatos, said the Santa Clara County market has shown signs of slowing down. The inventory of homes for sale doubled this summer, and the number of homes selling for more than $5 million has increased to a six-month supply, he said."

"The market is still historically strong, but Barnett believes its heading back to normal. 'It’s healthy,' he said."

"The association also surveyed about 1,500 agents to gauge what’s driving supply and demand. Agents reported sales to international buyers at their lowest levels in a decade. More first-time home buyers are moving outside of their county to find cheaper homes."

"'Are we at the peak of the cycle?' Appleton-Young asked. 'I think we are.'"

The San Diego Metro. "Sales of previously owned homes saw a significant drop in September, according to housing statistics compiled through the Multiple Listing Service by the Greater San Diego Association of Realtors."

"Single-family home sales dropped 25 percent in September, compared to August, and were nearly 22 percent lower than the same month last year. Condominiums and townhomes similarly saw an 25 percent decrease last month, and are down about 23 percent from September of last year."

"'I’m hopeful that residential sales will continue along a mostly positive line for the rest of the year,' said SDAR President Steve Fraioli, 'but it’s possible that rising prices and interest rates may factor into many home purchase decisions.'"