Yes, it’s raining (in the first week of October!) but according to this article in today’s Chronicle, “Prices in San Francisco, Marin and San Mateo counties will rise about 3.6 percent a year for the next two years even as home values in the East Bay slip, according to a Moody’s Economy.com report.”
There is another perspective in the article, too: “Christopher Thornberg, a principal in the Beacon Economics consulting firm, which has an office in San Rafael, said that while he agrees that a precipitous drop is unlikely, San Francisco is due for a correction.”
Inventory is up in San Francisco, but we’re not in a situation like Las Vegas where speculators built and built and filled in open space with spec houses. SF is pretty much built (except for the development slated for Mission Bay) and we don’t have huge subdivisions of empty houses begging for owners.