The California Housing Market Finds Its Balance 

Home Sales Pick Up as Prices Remain Steady and Inventory Gradually Shifts

California’s housing market showed some resilience in August, with both home sales and prices moving higher despite mortgage rates continuing to keep affordability in check. According to the latest report from the California Association of REALTORS®, existing single-family home sales reached a seasonally adjusted annualized rate of 269,620 in August, a 2.4% increase from July and 1.4% higher than August of last year. The statewide median home price also climbed back above the $900,000 mark, reaching $901,420, up 1.6% from July and essentially flat compared with a year ago. In other words, the market is still moving, but it is doing so with a little more caution and a lot more attention being paid to financing costs.

Mortgage rates remain one of the biggest pieces of the puzzle. The average 30-year fixed mortgage rate was 6.67% in August, compared with 6.59% a year earlier, and rates moved above 7% in the second week of September. That makes the monthly payment conversation more important than ever, particularly for buyers who are trying to balance price, financing, and long-term affordability. While buyers remained active in August, the higher cost of borrowing is creating a more measured environment as we move into the fall. The market has buyers, but they are increasingly selective about where they put their money.

"Buyers remained engaged in August despite elevated borrowing costs, but the recent rise in mortgage rates and continued economic uncertainty could create some headwinds as we move into the fall, at the same time, year-over-year gains show that demand is still there, especially among buyers who are prepared to move when the right home and opportunity come together." - C.A.R. President Tamara Suminski, a Southern California broker and REALTOR®

The sales numbers also tell an interesting story. Even with August’s improvement, California remained below the 300,000-home annualized sales benchmark for the 47th consecutive month. Southern California was among the regions where sales declined year over year, falling 4.8%, while the San Francisco Bay Area declined 4.2%. The Central Valley and Far North were exceptions, posting modest and stronger annual gains, respectively. For our local market, this reinforces the importance of looking beyond the statewide headline and paying attention to what is happening at the neighborhood and property level. California is a large and diverse market, and one number rarely tells the whole story.

On the pricing side, August was more of a steady-as-she-goes month than a dramatic price surge. The statewide median increased 0.1% from a year ago, marking the fourth consecutive month with an annual gain, but the underlying pace of appreciation remains modest. The median price per square foot was $428, up just slightly from $427 a year earlier, while the share of sales involving homes priced at $1 million or more declined for the third consecutive month. That combination suggests the August increase in the statewide median was not simply the result of more luxury properties changing hands. Buyers continue to place a premium on value, condition, location, and overall affordability.

Inventory is another piece worth watching. California’s Unsold Inventory Index increased to 3.7 months in August, up 8.8% from July and reaching its highest level in six months. At the same time, active listings were down 6.2% from a year ago. That may sound like a contradiction at first, but it reflects an important shift: there are fewer active listings overall, yet the homes that are on the market are taking a little longer to sell. Essentially, the market is not overflowing with homes, but buyers are taking their time before pulling the trigger. And honestly, with today’s financing costs, who can blame them?

For sellers, this environment makes presentation, pricing, and positioning particularly important. The statewide sales-to-list-price ratio was 98.9% in August, meaning homes that sold generally closed below their original asking price. At the same time, the median number of days to sell was 28 days, down from 31 days a year ago. The takeaway is not that every property needs to be discounted, but that buyers are paying close attention and properties need to give them a compelling reason to act. A well-positioned home can still attract attention, while properties that miss the mark on pricing or presentation may need more patience.

“The recent increase in mortgage rates adds another layer of uncertainty to California’s housing outlook, especially as the market moves beyond the peak homebuying season. While August showed that underlying demand remains present, pending sales softened and inventory is taking longer to clear, suggesting buyers are becoming more sensitive to changes in borrowing costs, if the Federal Reserve decides to take a more restrictive path for the rest of the year, mortgage rates could remain elevated or move higher, further challenging affordability and weighing on market activity this fall.” - C.A.R. Senior Vice President and Chief Economist Jordan Levine.

Looking ahead, the fall market will likely bring a little more selectivity from buyers as seasonal activity begins to cool and mortgage rates remain elevated. C.A.R. notes that home prices typically ease during the fall and winter months, while the recent rise in borrowing costs could place additional pressure on demand. For homeowners and sellers, this makes it even more important to focus on the factors we can control: accurate pricing, strong marketing, thoughtful presentation, and staying responsive to real-time buyer activity. The market may not be moving at full speed, but there is still activity and opportunity for properties that are positioned correctly.

Overall, August gave us a market that is neither running away nor standing still. Sales improved, prices held relatively steady, inventory took a little longer to move, and buyers remained active despite higher financing costs. As we head further into the fall season, the market will likely reward preparation and realistic expectations. For our clients, we’ll continue watching the numbers closely and, more importantly, keeping an eye on the activity happening around each individual property. Because while statewide statistics give us the big picture, real estate is ultimately a very local business, and what matters most is how the market is behaving around your home.

And now for the latest data on Los Angeles County real estate trends:

Single family homes  |  Los Angeles County | August 2026

New Listings: 4,460 (Down 16.60% year over year)

Homes Sold: 2,806 (Down 7.21% year over year)

Median List Price: $1,025,000 (Down .05% year over year)

Median Sales Price: $1,030,000 (Down 2.09% year over year)

Median Days on Market: 22 (Up 14.29% year over year)

Average List Price: $1,514,489 (Down 6.62% year over year)

Average Sales Price: $1,494,122 (Down 7.78% year over year)

Average Days on Market: 36 (Up 9.52% year over year)

List/Sell Price Ratio: 100% (Down .91% year over year)

Condo homes  | Los Angeles County | August 2026

New Listings: 2,110 (Down 3.49% year over year)

Homes Sold: 933 (Down 7.8% year over year)

Median List Price: $689,000 (Down 3.59% year over year)

Median Sales Price: $675,000 (Down 4.17% year over year)

Median Days on Market: 36 (Up 38.71% year over year)

Average List Price:  $860,909 (Down 11.77% year over year)

Average Sales Price: $848,178 (Down 11.22% year over year)

Average Days on Market: 52 (Up 15.38% year over year)

List/Sell Price Ratio: 98.6% (Down .92% year over year)