Bay Area home sales dropped in July, but so far prices haven’t followed

Though home sales throughout the Bay Area slowed this summer, prices remain stubbornly high.

New data from the California Association of Realtors shows that home sales across the nine-county Bay Area in July declined 4% from last year, while the median sales price stayed flat, at $1.3 million.

The median price was $862,500 in Contra Costa County, $1.25 million in Alameda County, $1.6 million in San Francisco, $1.9 million in Santa Clara County, and $2.1 million in San Mateo County.

“We’ve seen the market soften, but we haven’t seen any dramatic price reductions,” said Jordan Levine, chief economist for the California Association of Realtors.

The reason is that there are plenty more buyers looking than homes for sale available. Homes in desirable neighborhoods are still fetching multiple offers, agents say.

Marie Tesch in her new condominium on Tuesday, Aug. 5, 2025, in San Ramon, Calif. Tesch recently moved into the gated community after living in a single family home in Walnut Creek for 15 years. (Aric Crabb/Bay Area News Group)

Marie Tesch worked with an agent from TurboHome to stage her Walnut Creek townhouse, and paint the place a fresh new color, before listing it on the market.

“You definitely don’t want to just throw a house on the market right now — the most important thing is to make it look turn-key,” said Tesch, a former real estate agent herself. “The buyer has to feel like they’re not going to do anything.”

In just one weekend of open houses, Tesch got three offers. The home sold over asking.

Sellers who try to price high may be stuck with a home that sits on the market, agents say. Inventory is up 26% from last year across the nine-county region — and up by 64% in Alameda County — meaning that sellers have more competition, and buyers are taking more time to look. The median time on market was 24 days in July — up from 16 days a year earlier.

“Sellers still think they’re in the first quarter of this year, when prices were rising,” said Freda Wang, an agent with Compass in Santa Clara County.

In response, some sellers are dropping prices. In Santa Clara, Alameda and Contra Costa counties, nearly a third of listings logged a price drop in July. In San Mateo, 25% did, and in San Francisco, it was just 16%.

Condos are taking even longer to sell than single family homes — a median of 34 days this July, compared to 24 a year ago.

In part, new laws around balcony inspections are giving lenders pause. But it’s also about financing: condo buyers tend to be first-time buyers, who are more reliant on a mortgage. As of last week, the average rate on a 30-year fixed-rate mortgage was 6.58%, according to housing finance giant Freddie Mac. Compared to someone with a 2.5% rate in 2022, today’s buyer might be paying hundreds, or thousands, more on a monthly mortgage payment — even for a home with the same sticker tag.

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After months of pressure from President Donald Trump to cut interest rates, Federal Reserve Chairman Jerome Powell indicated in a speech last week that the central bank could begin reducing borrowing costs as soon as September, despite the risk of pushing inflation higher.

Even if the Fed cuts rates, that won’t necessarily translate to a decrease in mortgage rates. The two rates tend to move in the same direction, but their relationship isn’t direct.

Besides, mortgage rates aren’t the only concern holding back buyers, said Karen Kovacs, a Silicon Valley agent.

“People use mortgage rates as an excuse,” Kovacs said. “But political uncertainty and not knowing what big changes may be ahead in the economy are the reasons why many of my clients are on the fence.”

Some are using the market slowdown to their advantage. Kovacs says that she’s seen higher levels of investors in the market, looking for homes to flip.

Wang said she’s also seen investors scoop up condos in San Francisco’s East Cut and South Beach neighborhoods, then rent them to young, well-paid tech workers.

Ben Olsen, an agent in the East Bay’s Lamorinda corridor, says he expects that some of the July slump is merely seasonal, and that the market will begin the pick up again in a fall.

“Summer vacation is over,” he said. “We’re already starting to see an uptick in sales.”