NORTH COUNTY -- In one of the strongest signs yet that the housing market is cooling, San Diego County's inventory of unsold existing homes is fast approaching 16,000 -- twice the total one year ago and five times the number in March 2004, a local real estate agent said Tuesday.

Dennis Smith, a Realtor with Taylor Place Real Estate in Carlsbad who tracks inventory, said the number of unsold single-family houses and condominiums on the market reached 15,842 late Tuesday afternoon. Smith said that figure compared with an inventory of 8,449 on March 8, 2005, and 3,020 on March 15, 2004.

"We've gone up by 400 properties in the last five days," he said. "That's 80 properties a day."

At the same time, sales are declining sharply.

Still, analysts say the sales decline and inventory buildup do not signal a crash. They say it was inevitable that the market would chill following the its red-hot performance of recent years.

The inventory buildup comes on the heels of reports that countywide sales for January fell below 2,000 for the first time in years. The total of 1,876 sales for that month was down sharply from 2,297 in January 2005 and 2,599 in January 2004, according to the real estate listing service Sandicor.com. In January of each of the three previous years, sales totals exceeded 2,300.

In North County, sales of existing homes also fell sharply early this year, as the January total of 533 sales was 27 percent off the 2005 pace of 732, Cal State San Marcos economics professor Robert Brown reported last month. Brown compiles the North San Diego County HomeDex, a monthly index of housing prices.

The median January price in North County was $625,000, a modest appreciation of 5.9 percent from the year before. The previous January recorded a 20 percent year-over-year increase.

Analysts from around the region provided mixed views of what the growing inventory signals in the months ahead.

"We are just experiencing a soft correction," said Nicole McAllister, executive director of development for the University of Southern California's Lusk Center for Real Estate, noting she does not consider the buildup to be alarming.

"I don't think (the market) is headed for any catastrophic burst," McAllister said. "We're going to gradually see sellers adjust and soften their prices a bit. I don't think it's going to turn around and tomorrow everybody is going to get all these great deals."

Agreeing with the assessment that no sudden crash is about to occur, Christopher Thornberg, senior economist with the widely quoted UCLA Anderson Forecast, said one must keep in mind that inventories are rising from historically low levels.

"This is still just the beginning of a cooling trend in real estate," Thornberg said.

On the other hand, he said, it remains to be seen if prices will fall at some point or flatten out for several years. Thornberg is one who subscribes to the theory that Southern California is in a "housing bubble," a term used to describe a market where home prices inflate beyond what incomes can sustain.

Given today's low interest rates, Thornberg suggests a healthy ratio of housing prices to income levels is 8- or 9-to-1. "Right now we are at 12-to-1 -- and counting," he said.

Thornberg suggests homes are overvalued by 25 percent to 30 percent.

"There are two sets of people out there," he said. "One set is saying, 'The sky is falling! The sky is falling!' That's not true. The second set is saying, 'We now know the soft landing is here.' They're wrong, too. We don't know yet."

For his part, Smith said the buildup is "absolutely going to keep a cap on prices. … I don't expect the bubble to burst, but the air has been let out of the bubble."

For now, prices are holding steady, Smith said, noting that preliminary reports suggest prices were about the same in February as they were in January.

"A lot of sellers are standing firm, saying, 'My neighbor got $700,000 for his house, I should be able to get $700,000 for mine also," Smith said.

The buildup of unsold homes does offer an advantage to those looking for a home, Smith said.

"It's great news for buyers because now they have the time to shop around and a much larger inventory to choose from," he said. "It's becoming more and more of a buyer's market. But there are pockets where it is not."

An example of the latter, he said, is the Laguna Del Mar area of Carlsbad. Just four of the 112 properties in the coveted neighborhood east of the town's lagoon have come on the market in the last 18 months, and every time one does it attracts much attention.

"There is a pent-up demand for properties in that neighborhood, therefore multiple offers still happen there," Smith said.

But, he said, Oceanside's Quail Ridge is illustrative of an emerging trend. There, one of his clients who is trying to sell a two-bedroom, two-bath, 1,152-square-foot condo is offering it for a range, between $294,000 and $324,000, rather than a fixed price. And Smith said the owner is offering to pay the first six months of principal and interest -- roughly $11,000 -- to any buyer willing to pay in the high end of that range.

Contact staff writer Dave Downey at (760) 740-5442 or ddowney@nctimes.com.