Zooming in a bit on Los Angeles

A previous post showed a large drop in housing starts in Los Angeles at the start of a large downturn in the housing market. Here is a look at what single family sales did (both new construction and existing) as reported by NAR:



The data is fairly rough looking, but I think it is reasonable to conclude the drop in sales from 1989-1991 was roughly a 2 year warning before median prices started tanking in 1992-1993.
Here are single family housing sales today:



If this 2 year pricing lag is accurate today, then 2007 should not see median price declines.