From the Santa Monica Mountains to the Pacific Ocean, from Topanga Canyon to the borders of Ventura County, home sales and values in the City of Malibu are treading water.

Lower sales prices and a dramatic reduction in the number of sales have been noted, along with home values that continue to diminish. Median home sales prices have dropped over 30 percent this year. Even with the drop in the list price of homes on the market, buyers are just not biting.

In previous years in Malibu, the volume of home sales reached near-billion-dollar highs. Through last month, however, the total sales volume was only around $300 million. That’s over $600 million less than previous years, and a 62 percent drop in home sales volume. The total number of Malibu home sales is anticipated to be fewer than 100 for the year.

Falling home sale prices show that the area has finally emerged from its dark denial that it could happen to this up-scale city. Malibu has finally followed suit and succumbed to the economic downturn along with the rest of the nation, although, at a somewhat slower pace.

Malibu was of the mindset that it was impervious to the rest of the world’s real estate woes. What contributed to the perception was that when the remainder of the state was reporting huge drops in home values, up to 40 and 50 percent, Malibu was riding high with consistent increases in average and median prices.

On the heels of other cities whose real estate markets have already hit bottom and began an ascent, Malibu, on the other hand, may still be on a descent. Real estate professionals have doubled up their marketing efforts costing them more time, effort and money, along with homeowners who wait with anticipation, sometimes over a year, before getting the homes through escrow.

It is unclear as to whether Malibu real estate will continue to hold its current values at nine times that of the state’s median. With interest rates so low, you’d think the market would be moving more quickly.

It’s not for lack of willing buyers and sellers in the marketplace that homes aren’t moving, however. Serious scrutiny in lending is deterring or preventing many buyers from being qualified for loans that would easily have been approved previously.

With lower interest rates and lower market values, but buyers who can get qualified, it all makes for a strange brew, one that may take some time to flesh out.