The Big Story
Median home sale prices slipped for the second straight month in August, falling to $429,100 from June's peak of $442,800, though they remain slightly above where they were a year ago.
Inventory pushed higher again in August, reaching 1,620,000 homes for sale, the highest level we have seen in this cycle and nearly 6% above last year.
Existing home sales fell to 3,980,000, the softest reading in over a year, as mortgage rates climbed to 6.69% in August and 6.71% in September.
Note: You can find the charts & graphs for the Big Story at the end of the following section.
*National Association of REALTORS® data is released two months behind, so we estimate the most recent month's data when possible and appropriate.
The spring rally has given way to a summer cooldown
After five straight months of gains carried the median sale price to $442,800 in June, prices have now declined in each of the past two months. In August, the median home sold for $429,100, a 1.67% month-over-month decline from July's $436,400 and a 3.09% pullback from the June peak. The one bright spot is that prices are still running 1.59% above the $422,400 median we saw in August of last year, so the year-over-year comparison remains positive even as the seasonal momentum fades. The affordability story, however, has turned decisively less friendly. Mortgage rates jumped to 6.69% in August and edged up again to 6.71% in September, the highest readings in this entire data series and a full 71 basis points above the 6.00% low we saw back in March. The median monthly principal and interest payment now sits at $2,256, which is 2.50% higher than the $2,201 buyers were paying a year ago and more than $300 above the $1,949 January low. In other words, the affordability cushion that lower rates provided at the start of the year has now been completely erased. It is also worth noting that the Federal Reserve's mortgage-backed securities holdings have continued to run off, declining from roughly $2.05 trillion at the end of last year to about $1.91 trillion in September, which removes a meaningful source of demand for mortgage debt and helps explain why rates have been drifting higher even as the broader market cools.
Inventory keeps building, and that is the real story this month
Inventory did not plateau after all. After holding flat at 1,570,000 homes for three consecutive months from May through July, inventory jumped to 1,620,000 in August, a 3.18% month-over-month increase and a 5.88% gain over the 1,530,000 homes available at this time last year. That is the highest inventory level anywhere in this data series, and it represents a 31.7% increase from the December low of 1,230,000. What makes this build particularly notable is that it is not being driven by a flood of new supply. New listings actually fell to 401,760 in August, down 5.18% from July's 423,732 and essentially flat compared to the 402,276 new listings we saw in August of last year. So sellers are not listing more aggressively than they were a year ago. Instead, inventory is accumulating because homes are not clearing at the pace they once did. That distinction matters, because supply that builds from weak absorption tends to be stickier and puts more direct pressure on pricing than supply that builds from a surge of eager sellers.
Existing home sales have slipped below last year's pace
Existing home sales came in at 3,980,000 in August, a 1.97% month-over-month decline from July's 4,060,000 and a 1.24% drop from the 4,030,000 pace we saw in August of last year. This is the weakest sales figure in the data we have, and it marks a clear reversal from the spring, when sales were running above the prior year and reached 4,190,000 in May. The culprit is not hard to identify. Buyers who were enjoying sub-$2,000 monthly payments in January are now looking at $2,256, and mortgage rates that started the year at 6.16% are now sitting at 6.71%. When financing costs move that much in nine months, the marginal buyer simply steps out of the market, and that is exactly what the sales data is showing. Three consecutive months of declining sales, combined with inventory pushing to new highs, tells us that the balance of the market has shifted in a way it had not through the first half of the year. The question now is whether rates stabilize and let buyers re-engage this fall, or whether we continue to see demand erode into the winter.
Buyers are gaining leverage for the first time in a while
When determining whether a market is a buyers’ market or a sellers’ market, we look to the Months of Supply Inventory (MSI) metric. The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market. Any market that has lower than three months of MSI is considered a seller’s market, whereas markets with more than three months of HSI is considered buyers’ markets.
At the national level, the numbers point clearly toward a buyers' market. With 1,620,000 homes for sale in August against an annualized sales pace of 3,980,000, the implied months of supply works out to roughly 4.9 months, comfortably above the three-month threshold that separates balanced markets from buyers' markets. A year ago, that same calculation produced about 4.6 months, so supply has loosened meaningfully over the past twelve months. Every component of the equation is currently moving in buyers' favor: inventory is at a cycle high and rising, sales are falling on both a monthly and annual basis, and median prices have declined for two straight months. The obvious catch is affordability. Buyers may have more negotiating room and more homes to choose from than at any point in recent memory, but with rates at 6.71% and monthly payments up more than $300 since January, the cost of taking advantage of that leverage has risen sharply. Sellers, for their part, should expect longer marketing times and more price sensitivity than they saw this spring. As always, real estate is a highly localized asset, which is why you should check out what's going on in your local market below in the Local Lowdown!
Big Story Data
The Local Lowdown
Single-family prices are holding firm year over year, with Alameda County up slightly and Contra Costa County up nearly 3%, while the condo picture has split sharply between the two counties.
For-sale inventory continues to run well below last year, with single-family listings down almost 17% and condos down nearly 10% year over year.
Single-family homes are selling faster than they did last August in both counties, though the pace has cooled from the spring peak.
Months of supply remains firmly in seller's market territory for single-family homes, while condos sit on the buyer-friendly side of the ledger.
Note: You can find the charts/graphs for the Local Lowdown at the end of this section.
Single-family prices hold their ground as the condo market splits in two
August delivered a steady, if unspectacular, close to the East Bay's summer selling season on the single-family side. In Alameda County, the median single-family home sold for $1,269,000, up 0.71% from the $1,260,000 recorded last August and essentially unchanged from July's $1,270,000. That puts Alameda roughly $121,000 below the May peak of $1,390,000, which is the normal seasonal fade we see as the calendar turns toward fall. Contra Costa County looked stronger on a year-over-year basis, with the median single-family home selling for $865,000, a 2.98% gain over last August's $840,000 and flat against July.
The condo market is where the two counties have gone their separate ways. Alameda County condos posted a median sale price of $562,500, up 2.37% year over year and up 1.72% from July, continuing a slow, grinding recovery off the $515,000 January low. Contra Costa County condos, by contrast, gave background in a meaningful way. The median condo there sold for $444,950, down 12.75% from last August's $510,000 and off 5.63% from July's $471,500. That is the softest reading we have seen in Contra Costa's condo segment since early 2025, and it is worth watching closely over the next couple of months to determine whether this is a thin-month anomaly or the start of a genuine downtrend.
Inventory keeps shrinking as the summer listing window closes
Supply continues to be the defining story of the East Bay market. Single-family homes for sale stood at 2,662 units in August, down 16.68% from the 3,195 available a year ago and off 5.20% from July's 2,808. Notably, this decline is not coming from a lack of sellers. New single-family listings actually rose 3.76% year over year to 1,792, but with 1,230 homes selling during the month, the available pool kept draining.
Condos followed a similar path. For-sale condo inventory finished August at 934 units, a 9.58% decline year over year and a sharp 10.71% drop from July's 1,046. Unlike single-family homes, condo sellers pulled back, with new condo listings falling 10.31% from last August to 383. Condo sales, meanwhile, edged up 3.77% year over year to 248 closings. Taken together, the East Bay is heading into the fall with a thinner set of choices than it had a year ago in both property types, which should provide a floor under pricing even as seasonal demand softens.
Single-family homes still outpacing last year, condos more mixed
Tight supply continues to translate into quick sales on the single-family side. The average Alameda County single-family home sold in 14 days in August, a 17.65% improvement over the 17 days it took last August, and a touch faster than July's 15 days. Contra Costa County single-family homes averaged 20 days, which is a 9.09% improvement year over year but a noticeable slowdown from 16 days in July and 13 days back in May, reflecting the usual late-summer cooling.
Condos remain the slower of the two segments. Alameda County condos averaged 32 days on market, an improvement of 15.79% over the 38 days recorded last August, though up meaningfully from an unusually brisk 22 days in July. Contra Costa County condos also averaged 32 days, matching July but running 23.08% longer than the 26 days it took a year ago. That combination of longer marketing times and a lower median price tells a consistent story about where the softness in this market currently sits.
Single-family homes stay a seller's market while condos favor buyers
When determining whether a market is a buyers’ market or a sellers’ market, we look to the Months of Supply Inventory (MSI) metric. The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market. Any market that has lower than three months of MSI is considered a seller’s market, whereas markets with more than three months of MSI are considered buyers’ markets.
By that standard, the East Bay's single-family market remains clearly in sellers' hands. Alameda County closed August with 1.9 months of supply, down 17.39% from 2.3 months a year ago, while Contra Costa County sat at 2.4 months, a 17.24% decline from last August's 2.9 months. Both counties have now trended lower for several consecutive months after peaking around 2.1 and 2.5 months in late spring, meaning buyers of detached homes are facing tighter conditions this fall than they did last fall. The condo market continues to sit on the other side of the line, with Alameda County at 4.1 months and Contra Costa County at 4.0 months of supply. Both figures are improvements over last August's 4.8 and 4.4 months respectively, and both have come down from spring highs near 4.9 and 4.7 months, so the condo segment is tightening even as it remains a buyers' market. For sellers of condos, particularly in Contra Costa County, pricing discipline and patience remain essential. For buyers, this is still the corner of the East Bay market where negotiating leverage exists.
Local Lowdown Data
