Why Is California's Housing Market So Volatile?

Nineteen years ago, I made the trek from a small, industrial city in Ohio to Orange County, California, to take a job at a large daily newspaper. Oddly enough, my friends in Ohio thought I was crazy to head to California, and my wife still sneers at me for accepting the post without having a conversation with her about it. What was there to discuss? In hindsight, the only real hurdle in building a life in California involved housing. In most places here, you need a hefty income (or trust fund) and down-payment to buy even a modest place.