Personally, whether or not there is a price correct is, IMO, significantly less important than the volume of trading that occurs at those corrected prices.
If median prices drops 20% but transaction volume and available inventory drops 40%, then the number of investors who will be able to benefit from the crash and the window of opportunity to take advantage of price correction is extremely limited. And the only people who "lose their shirt" in such a scenario and exit the market entirely, are people who are forced to sell within that limited window.
For investors, they may be forced to sell if they lose cashflow or ability to service debt (rent drops, property goes vacant longer-term, or they planned on flipping it and do not have the reserves to keep paying interest). For homeowners, forced selling really only happens if they can no longer afford the payment, which only really happens when they lose their job and cannot find another one in time.
Now, homeowner credit profiles have essentially never been better, and most of them have locked in low rates, and make over $100,000+ per year. The risk of forced selling there only happens if there is significant, sustained job loss in well-paying sectors of the economy (which typically tend to be more stable, especially with the current labor market and general employer need for long-term talent retention to avoid brain drain with an aging and less productive population). So there likely is not going to be a rash of homeowner foreclosures flooding the market. Homeowners don't sell at a loss just because of fear of the market dropping; generally they didn't buy they home because they thought it was an amazing deal but because they needed somewhere to live, they and their families liked the location, property, etc, and they can afford the fixed monthly payment.
Investors, on the other hand, are more likely to be forced sellers in the coming years, especially those who bought improperly. A renter who loses their job has very little switching costs for moving properties compared to a homeowner, and with more multifamily inventory coming online or economic hardship pushing homeowners to rent out extra rooms, etc, rents are likely to soften in the event of further economic distress. But, in most markets, investors barely make up single-digit % proportions of total sales. In 2021, however, nationwide investors have made up 24% of the single-family housing sold, so that's a more substantial portion. In some markets, the proportion is likely even higher than that, especially those that are extremely investor heavy. These are the markets in which I expect the largest declines.
However, overall, this brings us back to the data suggesting that, while there may be a price correction, the amount of product that will be available for purchase at those corrected prices before the market recovers is likely to be low, maybe even below 10-20% of total inventory.
