UCLA: No Decline in Prices

This slower market is not a sign of a recession because the Southern California and national economy is strong and there is no "vulnerability" in the job market. The speculative demand got way out of hand, which drove prices up even higher, but the speculative buyer has departed the market. Speculators enter and leave the market suddenly, since they lack the emotional component about their properties that the usual residential seller has.
So the bottom line is: "We do not predict a recession, nor do we predict a substantial decline in average nominal home prices," said Ryan Ratcliff, a UCLA economist. "The forecast is based on two arguments. There is not enough vulnerability in the usual sources of employment loss to create a recession, and the historical record suggests that average home prices do not usually fall without this kind of job loss."