California’s real estate market presents a complex picture, marked by record-high home prices, increased inventory, and regional disparities. Here’s a detailed overview:
🏡 Home Prices and Sales Activity
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Median Home Price: In April 2025, California’s median home price reached a record $910,160, marking the 22nd consecutive month of year-over-year increases. However, the annual growth rate has slowed to 0.7%, the smallest since July 2023, indicating a potential moderation in price escalation.
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Average Home Value: According to Zillow, the average home value in California is $796,255, reflecting a 1.3% increase over the past year.
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Sales Volume: In May 2024, existing single-family home sales totaled a seasonally adjusted annualized rate of 272,410, down 1.1% from April and 6.0% from May 2023.
📦 Inventory and Market Supply
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Active Listings: As of April 30, 2025, there were 82,943 homes listed for sale in California, with 30,286 new listings added that month.
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Market Dynamics: The median days to pending sale is 17 days, indicating a relatively brisk market pace. Additionally, 40.9% of sales closed above the list price, while 44.3% were below, suggesting a balanced negotiation landscape.
🌆 Regional Highlights
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Bay Area: Affordability remains a significant challenge, with 59 cities in the region requiring at least $1 million for a starter home. San Francisco’s median starter home price is approximately $706,000, with a projected 5% price drop in 2025.
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Dana Point: A luxury oceanfront home sold for $34 million, setting a new price record for the town and reflecting a 5.9% year-over-year increase in median sale prices.
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San Francisco: Millennial homeownership is gradually increasing but still lags behind older generations, influenced by high housing costs and economic factors.
🔮 Market Outlook
The California Association of Realtors forecasts a 4.6% rise in the median home price to $909,400 in 2025, driven by persistent housing shortages and competitive market conditions.
However, the market shows signs of stabilization, with increased inventory and moderating price growth. Affordability remains a pressing issue, particularly in high-cost regions, and policy measures like Senate Bill 684 aim to address housing supply constraints.