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Most likely to recede The PMI Risk Index measures the likelihood of a price decline over the next two years. Metro area  Risk for decline*  Boston, MA  53%  San Jose, CA  53%  San Francisco, CA  48%  San Diego, CA  43%  Providence, RI  40%  Sacramento, CA  37%  New York, NY  36%  Los Angeles, CA  36%  Riverside/San Bernardino, CA  32%  Detroit, MI  27%   * Percentages are rounded.  Source: PMI Mortgage Insurance

SALEM, Ore. (CNN/Money) – As the great real estate bubble debate drags on, markets in California are most often singled as those ripest for a fall.

But if California falls, will other markets go with it?

Already, Californians wield unprecedented influence on real estate throughout the West. Flush with home equity made from huge price gains in their own state, they're staking their claim on Oregon ski towns, fueling bidding wars in Arizona golf communities and doubling down in Nevada.

"Probably 60 percent of our residents over the past 10 years have been from California," said Cary Krukowski, director of marketing at Lake Las Vegas a resort community about a half an hour outside of Las Vegas. In downtown Vegas, roughly half of all buyers in the Newport Lofts are from California, according to the Newport Beach, Calif. developer Seegmiller & Partners. Home prices in Las Vegas increased about 50 percent last year.

"We call it the echo effect," said J. Lennox Scott, CEO of John L. Scott, a real estate company with 126 offices in Washington, Oregon and Idaho. "People move to California for work or the weather and then eventually they travel up the West Coast."

And eventually buy property. Recently, between 40 percent and 50 percent of Seattle buyers who work with John L. Scott's relocation division came from California.

"I'd say that about 75 percent of my clients on the buyers' side are from out of the area, and about half of those buyers are from California," said Bryant Green a real estate agent with The Hasson Company in Bend, Ore., a mountain town in the central part of the state. Some are relocating, he said, but in many cases they're buying a second house, typically paying for it with cash-out refinancing or a home equity line of credit.

"The prices in California are so high for the typical house they can take out $200,000 from their home equity and come down here and pay cash for a house," said Dennis Alaburda, a broker with Arizona Best Real Estate in Scottsdale, Arizona, where prices have increased more than 20 percent in the past three months.

Some are buying property for personal use, he said, but many are pooling their resources and buying up inexpensive "first-time buyer" homes purely for speculation. "All of those houses are being swallowed up by California investors," he said. "All of them."

One of the reasons Californians are influencing other housing markets is, of course, because there are so many of them. One out of every eight Americans lives in California.

Some are house rich and enthusiastic about "diversifying" their real estate portfolios. Others, priced out of their own communities, are leaving California in search of more affordable housing.

"There is this 'Go East' mentality in California," said William Frey, a demographer with the Brookings Institution, citing U.S. Census statistics showing a net loss of domestic residents. The reason: high housing prices. "Even people who have lived there most of their lives, when it comes time to retire are cashing out and leaving."

The median home price in Los Angeles, now $446,400, is up 54 percent over the past two years, according to the National Association of Realtors. In Riverside and San Bernardino counties, the median price, $296,000, has increased 69 percent over the same time.

Few economists believe that California home prices can continue appreciating at that pace. David Stiff, a senior economist with Fiserv CSW expects that home prices will increase less than 10 percent in the coming year.

Title insurer First American Corp. is predicting that prices in Southern California will flatten, with small increases and even small declines in some areas.

According to mortgage insurer PMI Group's risk index of housing markets, six California metropolitan areas rank among the 10 markets most likely to see price declines.

"Hawaii's home prices suffered in the 1990s because of economic trouble in Japan," said Dean Baker, co-director of the Center for Economic Policy Research. "If home prices in California reverse, it will have ripple effects."

Soft prices in California could dampen enthusiasm for real estate in surrounding areas, said Stiff. To what degree depends on whether California buyers are shopping for property in earnest or looking to make a quick buck on real estate. Again.

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