How's the Bay Area Real Estate Market? More Choices, Less Frenzy—Why This Season could be a Golden Window for Both Buyers and Sellers
The Bay Area housing market—including Santa Clara, San Mateo, San Francisco, and Alameda Counties—continues to be a strong sellers’ market, but recent trends show it is shifting slightly toward buyers compared to earlier this year. Based on the latest MLS data and reports from the National Association of Realtors (NAR) and the California Association of Realtors (CAR), the market is seeing modest increases in inventory, longer days on market, and mortgage rates easing, which together are making home ownership more attainable and giving buyers more room to negotiate while sellers still hold considerable leverage.
Sales and Pricing Trends
Across these counties, year-over-year sales are down roughly 4%, and median home prices have softened slightly. San Mateo County’s single-family homes saw a modest price adjustment with a median price near $1.9 million and inventory rising to approximately 1.7 months, a slight improvement from the more constrained market earlier in 2025. Homes are spending around 24 days on market compared to 16 days last year, and the sales-to-list-price ratio has edged down to just below 99% overall, signaling more frequent negotiations and fewer bidding wars than before.
Inventory and Market Dynamics
Even with the inventory gains, the total supply remains below the balanced market threshold of ~3-5 months, so sellers retain the upper hand. However, the increase in available listings and an extended time to sell indicates less urgency than in previous months. The condo and townhome segments especially show signs of softening, with more choices for buyers and muted price pressure.
Impact of Lower Rates and Market Sentiment
Mortgage rates have declined from peak levels to around 6.5% for a 30-year fixed loan, according to NAR and CAR, renewing buyer confidence. This lower cost of borrowing has boosted affordability, drawing more buyers back into the market and encouraging some sellers off the sidelines. Market uncertainty, coupled with these interest rate shifts, is creating a more balanced environment where buyers have enhanced negotiating power even as sellers benefit from sustained demand.
Conclusion: Buyer Opportunities with Seller Strength
While it’s still fundamentally a sellers’ market throughout the Bay Area, the conditions are evolving. Buyers now find increased options and moderately reduced competition, especially in specific segments and locales. Sellers who price carefully and prepare well continue to attract strong interest. This nuanced shift presents a unique opportunity for both sides to enter the market with some confidence and strategy, as lower rates meet slowly rising inventory and a moderately paced market.
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As always in real estate, local conditions can vary significantly from broader trends. This blog post is for informational purposes only. This is general in nature and may not apply to your specific situation. Please consult with the appropriate specialized CPA, Financial Advisor or qualified Tax Professional for personalized guidance on real estate-related tax benefits and financial advice.
If you're looking to buy or sell a home, message or call me to have a conversation about your real estate goals. With a data-driven approach to selling and buying homes, I can help you find opportunities and make informed decisions about real estate.
tim.chong@kw.com | 408.459.9777
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Sources: MLS Listings, California Association of Realtors (CAR), National Association of Realtors (NAR). Image by Jakub Żerdzicki.
