I take this as a massively worrying sign and I’m tempted to stay on the sidelines until things cool down.

I recommend all newbies start local for various reasons but at this time I also recommend all newbies sit on the sideline for a while to see how things play out.Some items about investing local to San Diego:Case Shiller lists San Diego as having the 3rd best buy n hold return for this century.BP recently released spreadsheet had San Diego in the middle for buy n hold cash flow (not including property appreciation) for the span 2010 to 2018. 

I do have cash sitting on the side lines in my stock accounts waiting for things to recover, then I will jump back in on the up swing.

It's better to have taken a step and make a mistake than sit on the sideline.

They can afford to buy a home, but sitting on the sideline.  

Right now inventory is slowly creeping back up as many buyers sit on the sidelines due to high interest rates which means less competition but also increasing home prices.

Many newer investors are scared to jump in or sitting on the sidelines with higher interest rates, but they will be the same ones competing against each other again when rates drop causing another sellers market. 

With the market so hot right now, I am sitting on the sidelines in financial alternatives.

It takes a strong stomach to stay on the sidelines.

Even Laundromat's might be an option.I have always stayed on the sidelines but now want to "get into the game".The RE Market in the Denver area seems to be recovering quite nicely as I am seeing a lot of new construction and fewer empty commercial spaces.