The LA Times Blog had a bunch of numbers that shed light as to what is happening here. Click here to read it.

In a nutshell:

Homes sold in 2007 dropped 34.9% from 2006 levels.
Sales of single-family homes in December 2007 were down 51.6% from a year before.
Median price of homes sold in December ’07 was $480,000, a decline of 14.3% from the December ’06 median of $560,000.
Total 2007 sales, of 6,271 single-family homes, is well below the previous low — 7,774 in 1992. Annual Valley sales in this cycle peaked at 13,878 in 2003.

Of course this gets a few people into doom mode but it really isn’t doom at all. We had unsustainable growth rates for a few years, now it’s the counter swing. As with anything in life, the swing to the right is equal or less to the swing to the left.