This excellent Calculated Risk post details how some parts of MA have experienced year-on-year price declines, and how people are leaving CA because they cannot afford a house there. My wife and I have decided to leave MA, but have not decided where to go next. The cost of housing was a factor -- let's face it, if you're going to pay through the nose for housing you might as well get better weather and better food.
In any care, we are an example of a marginal buyer who is now a non-buyer for sure, although we'll remain in the state for several more months. There may be a lag between when people decide to exit the market and when they physically do.
I would also add that one of the most obviously bubble-like features of the current real estate run up is the yawning gap between rents and prices. The families described leaving CA for KS in the NYTimes article were leaving because homes were expensive to buy not expensive to rent. Rents have been flat to declining for the past 5 years and certainly in CA and MA people can comfortably rent places they could never afford to buy. Mind you, friends that bought in 2002 (when I thought prices were too high) have done extremely well, so what do I know?
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