"Southern California's high housing costs have become a big turnoff to investors...who have fled for more affordable pastures.
Many analysts say that's a good thing. Although the falloff of speculative activity probably means Southland home prices won't surge soon, it also could keep home values from tumbling â€" and lead to a much more desirable 'soft landing,' or flattening of prices.
Too much speculative activity from investors hoping to turn a quick profit is perhaps the biggest sign that a market â€" whether real estate or stocks or any other asset â€" is in an overpriced 'bubble' condition, economists say. Too many speculators drive prices too high, and when they sense that the market is topping, they tend to sell all at once, sending prices into a free fall."