Others that recently shifted forecasts to include home price declines in 2023 are Capital Economics, an international economic research firm, and John Burns Real Estate Consulting in Irvine.

In May, John Burns started forecasting that both national and Southern California prices would decline next year, in part because the firm sees a recession as increasingly likely.

In 2023, the consulting firm expects declines in the mid single digits in Los Angeles and Orange counties and for prices to fall in the high single digit range in the Inland Empire.

The firm forecasts prices will drop at a somewhat smaller rate in 2024 both locally and nationally, before rising slightly in 2025.

Mark Zandi, chief economist at Moody's Analytics, said prices could fall even absent a recession.

If rates don't jump "meaningfully over 6% for an extended period" and the economy avoids a recession, Southern California home prices should be largely flat over the next few years, though some communities that saw dramatic pandemic booms could see declines.

But if rates rise to around 6.25% or 6.5% and hold there, Zandi said, Southern California prices would probably fall around 5% without a recession and potentially as much as 10% with a recession.

He said the most likely scenario is flat prices, but if he were an odds maker he'd say there's a 40% probability of Southern California home prices falling at least 5% from peak to trough, up from a 25% chance in May.

He and other experts said it's extremely unlikely home prices would collapse like they did during the Great Recession.

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In large part, that's because many current owners don't like to sell for less than their neighbor did a few months ago, which experts predict will limit price declines.

Things were different last time around. Risky lending during the early 2000s housing bubble caused a wave of foreclosures and sparked a financial crisis, sending Southern California prices down 50% from 2007 to 2009, according to numbers from DQNews.

Now, most economists think any recession would be mild. Tighter lending standards also mean those buying their homes during this boom could largely afford them and far fewer people will be forced to unload their properties, experts said.

Plus, there's a large cohort of millennials in their early 30s looking to buy a home for the first time.

"There won't be as many foreclosures and distressed sales, which is what you need to get prices way down," Zandi said.