Across California, home sales are down, but the Bay Area is feeling the pinch more than other regions. According to the California Association of Realtors (C.A.R.), existing, single-family home sales in California totaled 261,820 in July 2025, a 4.1% decrease from July 2024. While other regions like Southern California (-1.7%) and the Central Valley (-1.5%) saw declines, the San Francisco Bay Area’s 4.1% dip was the most significant. Within the Bay Area, several counties experienced sales declines: Alameda (-7.4%), Marin (-13.2%) and Santa Clara (-8.7%). However, San Mateo bucked the trend, with a 12.2% increase in sales. Napa and Sonoma counties also saw positive YOY growth.
Home Prices
Are Home Prices Dropping?
While the San Francisco Bay Area’s median home price remained unchanged year-over-year, at $1,300,000, the price actually dipped from June 2025’s median of $1,400,000. This 7.1% decrease month-over-month suggests that the market is cooling off a bit in response to lower demand.
Across California, the median home price in July 2025 was $884,050, which is down 0.3% from July 2024. Prices have been trending slightly downward for the last 3 months. While a small decrease, it’s a sign that the previously relentless rise in home prices might be slowing down.
Housing Supply
One factor influencing the market is the increasing housing supply. The Unsold Inventory Index (UII), which measures how long it would take to sell all homes on the market at the current sales rate, was 3.7 months in July 2025, up from 2.9 months in July 2024. This means there are more homes available for sale, giving buyers more options and potentially reducing competition.
Total active listings were up a whopping 37.7% from a year ago, reaching a 69-month high. That said, the pace of growth in total active listings decelerated for the third straight month, hitting its lowest rate in seven months.
In the San Francisco Bay Area, the UII stands at 2.7 months, up from 2.0 months last year.
Is It a Buyer’s or Seller’s Housing Market?
With increasing inventory and slightly declining prices, the market is starting to shift away from being a strong seller’s market. It’s not quite a buyer’s market yet, but buyers are gaining a bit more leverage. Homes are staying on the market longer, and there’s more room for negotiation.
The median number of days it took to sell a California single-family home was 28 days in July, up from 20 days in July 2024. The statewide sales-price-to-list-price ratio was 98.5 percent in July 2025 and 100 percent in July 2024, indicating that homes are more often selling for slightly below the asking price.
Market Trends
Several factors are contributing to these trends:
- High mortgage rates: Although rates have slightly decreased since last year, they are still high enough to deter many potential buyers, especially first-time homebuyers.
- Economic uncertainty: Concerns about the overall economy can make people hesitant to make big financial decisions like buying a home.
- Seasonal slowdown: The summer months often see a slight dip in real estate activity.