Unfortunately, I think the devastation and loss of life will be more of a factor than home pricing.

I can't imagine any other scenario than prices dropping dramatically as the area could be partially destroyed.  I believe home construction has improved dramatically in earthquake prone areas, but as you said, they are overdue.

Depends - there was one several years ago and S.F. / Oakland bounced back very strong

The homes left standing would probably get even pricier.

Interesting question and I love the debate going on here 

I believe there would be a spike in inventory and as a result propery values would decline. 

There was a great article about that a few months ago in The New Yorker.  It was amazing, well-written.  The seismologists are more concerned about Washington and Oregon, in large part because of the soil type.  Here's a link to the article.

Perhaps in the short term but I think the matter would be rather complex, depending on amount of damage and where. I hope I am not around to find out the reality

You know the answer to that question.

It's difficult to say what might happen. There are some very interesting and well thought out answers. 

They went up! I lived through many and survived the 1989 quake, which was the biggest of my lifetime, bridges fell and houses fell down hillsides and or sank into the landfill. Prices went up, up and away!

Robert Vegas Bob Swetz What homes!

There was one a few years ago (1989), and parts of the bridge was broken.  Some of the properties near there had a better water view because the bridge was gone.  When they rebuilt it they kept it that way, and their values went up....

Only time may answer that question.  I hope I am not around to see it. 

I would think prices would drop and more people moving to Colorado.

 The comments so far all talk about the earthquake.  According to the New Yorker article (thanks to Patricia Kennedy for the link in her comment) the Big Earthquake that is overdue will be 9 on the Richter scale, and cause a Tsunami.  I may remember incorrectly, but I think it said everything for the first 300 or so vertical feet will be awash with debris, including cars, bridges and buildings that didn't stand up to the wave coming in.  The land prices will drop and then skyrocket, but the recovery time for clearing all that extra tsunami mess before infrastructure can be re-created will surely slow recovery down, and this assumes no further aftershocks to cause further damage.......... so many unknowns, so much misery, no potable water for miles, no food, enormous amounts of debris and rotting things, and perhaps fire from burst pipelines. Three hundred vertical feet scoured by a massive wave is a lot of coast.  This will cause a lot of change......

     Unless it's an apocalyptic nightmare where the coastline moves inland (or farther out), there will be market instability until the infrastructure (roads, communication, water, sewer, etc.) is repaired and reusable. 

    The market would then see a resurgence, possibly even a lot of investors moving in to take advantage.

I'd say prices would go in both directions.  Devestated areas would drop and prices for remaining homes could skyrocket because now there is additional demand from those that lost their homes.

it would all fall between the crack in the earth....

It's happened before, during the 1989 world series - I imagine the same thing would happen  - they'd rebuild and the prices would go up yet again

There may be a demand for the needed new housing.

May it never happen! Some homes may appreciate if they are now waterfront!

I agree with Paul S. Henderson, REALTOR®, Broker, Tacoma Washington 

I do not want to think about it.

Margaret Goss nailed this one!

They would devalue and people would sell. Then, market returns where new sellers selling at high point of market.

I would guess initially there would be a decline in prices, but they would go back up again. California has had many quakes north and south and it doesn't seem to have affected home values over the long run.

Robert Vegas Bob Swetz - if nothing much happens to the homes, they will go up! 

I would think they would drop, but I'm not from there.

It depends on if they are affected or not...

I suspect that supply and demand would step in and drive the prices up to make up for the homes that where destroyed.

Probably a lot more impact than major snowstorm in northeast. (I live in Lake Erie snowbelt)

Already is shortage of housing. 8 Point earthquake takes down the Marina and any homes on sandy soil. After the 4 week emergency: contractor prices soar for repairs of masonry, permits take 2 years for new houses rather than 1 year, houses standing increase in value.  People buy earthquake insurance when it becomes available. Earthquake coverage has huge deductable sometimes $20- 30000 ( about cost to rebuild chimney in Bay Area which is what falls down in a 6 -7 point earthquake) 

Mother nature would reclaim what is rightfully hers and those that were once high, will be made low. Tragic resetting of all circumstances

Out in California, they're gonna have some warm weather tomorrow, gang wars, and some *very* overpriced real estate. Up in the Pacific Northwest, as you can see, they're gonna have some very, very tall trees.