Monthly report · No.15
FRIDAY, JUNE 27, 2025
the state of the market
The Housing Factor
By Ehsan Habib
*Data is sourced from the MLS and considers detached Single-Family Homes
The pace of new listings is slowing down but the overall trajectory of the market remains consistent with previous months. The supply of inventory is outpacing the rate of buyer demand and we are seeing a softening of prices…in the aggregate, that is. As we like to say once a day or more - market dynamics are hyper local! This story does not fit the Berkeley market, for example.
We’ve yet to see much “rebalancing” in the market. Berkeley, and the communities surrounding it, continue to attract strong demand while other communities are softening for buyers. I define rebalancing here as buyer demand shifting from more expensive neighborhoods towards less expensive neighborhoods. As always, the dynamics can’t be simplified down to cover whole cities - for instance, the hills of Berkeley have actually seen a 3.8% decrease in median sales price YoY.
As more people are returning to their office commutes we are noticing supply noticeably outpace demand in our more Northern towns, such as Hercules and Pinole. Hercules has had a weaker absorption rate than Oakland or Richmond over the past 3 months.
Anecdotally, we’ve seen some unusual dynamics over the past few months, starting with the current administration’s trade tariff policies. While we initially saw some panic (i.e., buyers pulling back), people have largely “kept calm and carried on” for the past 2 months (despite very concerning events on the global stage). The trends reflecting home buyer demand have broadly kept in line with the stock market (making me think of this blog post from JVM about “the wisdom of crowds”). We saw this panic when Trumps’ tariff policies were first unveiled in April and stock markets dipped and interest rates increased. From May through to the present we haven’t seen any signs that buyers are pulling back from the market.
Buyers are enthusiastic to buy…but median sales price is down 8.9% YoY, and a majority of US consumers believe that now is not a good time to buy a home. What gives? Inventory has been steadily rising, and the market is healthier now than it was in 2023 when supply was remarkably constrained. As inventory has opened up, buyers can be more selective about the homes they pursue. Buyers in “more desirable” areas are throwing in with the competition and keeping prices high in those areas. Others are taking advantage of reduced competition to get great deals where they can.
Whether buying or selling, how this data can inform your strategy for success will depend on what specific cities or neighborhoods you are operating in, as well as your personal circumstances. For a personalized consultation, reach out to us! We’re always happy to hear from you.
Delighted to be featured in
the keycrew journal
By Declan Spring
I was surprised and grateful to receive a phone call recently from the industry magazine The Keycrew Journal requesting an interview. Here’s an excerpt and if you’de like read the article in it’s entirety please click here.
“I worked my way up from being a busboy at Fisherman’s Wharf in San Francisco to eventually applying my craft,” he recalls. With a background in photography from his education in Ireland, he found his way into real estate through photography work for a residential real estate company and for CoStar as they built their commercial property database in the early 2000s.
Today, his approach to real estate is deeply rooted in community building and long-term relationships. “I like to really touch lives and become part of the family,” he explains. “Now I’m at a point where I’m helping maybe a second generation of people from the same family. That’s my jam. That’s what makes me happiest in the world.”
One of the most misunderstood aspects of the East Bay market, particularly in Berkeley, is the strategic underpricing of listings, a practice that has been standard since the dot-com era of the late 1990s.
“We have a system in Berkeley of listing property that is often not well understood by consumers,” Spring explains. “You saw it showing up during the pandemic when real estate became extraordinarily popular everywhere… property would sell over. Everyone’s talking about, ‘Oh, it sold 20% over, 30% over.’ That dynamic has existed in my local market year in, year out, even during the recession.”
What outsiders fail to understand, according to Spring, is that “property is priced 30% under, and it’s just a simple switch in your mind.” He elaborates: “A realtor listing a property that’s worth $1,500,000 is going to list that property at $1,100,000. That’s just the way it is.”
This pricing strategy creates a potential pitfall for investors trying to analyze the market without local expertise. “If you’re not bringing in the assistance of a local realtor as an investor… and you’re trying to analyze data on your own… you are missing out on strategy insight that can be a fatal flaw,” Spring warns.
Our Promise: Up To The Minute East Bay Real Estate Data Straight to Your Inbox
By Declan Spring
I’ve been keeping a blog for the past year on our website. I spend hours every week pouring over Inner East Bay real estate market data trying to understand what’s just occured in terms of supply and demand, what’s happening in real time, and what might happen next. Market evolution is my jam! Recently though it occured to me that maybe nobody uses the word blog anymore.....
Feeling every bit my 52 years of age, I take some measure of satisfaction (and relief) in having come to this conclusion myself, before either of my kids could gently pull me over to the corner of the room and let me know that I’m embarrassing them with all of this blog talk.
SUBSTACK
And so, to be better aligned with popular trends, the blog is no longer a blog. I created a Substack! This extremely up to the weekly post will make you the real estate expert at parties with brilliant insights such as the average sold price in the past 2 weeks for single family homes in each of our 3 biggest Inner East Bay cities of Oakland, Berkeley, and Richmond. Please click here to subscribe.
Mortgage news
MORTGAGE MUSINGS
By Evelyn Freitas | VP of Mortgage Lending at Guaranteed Rate NMLS 247578
Bay Area Mortgage Snapshot: What the Numbers Say (and Why This Might Be Your Moment to Buy)
Cash buyers are out there – but most people are financing. Nationwide, around a third of home sales in 2024 were all-cash. Here in the Bay Area, that number is significantly ower. In Oakland, fewer than one in five buyers paid cash, meaning the vast majority used a mortgage to purchase their home. San Jose showed a similar trend, with most buyers choosing to finance.
In most of Alameda and Contra Costa Counties, cash transactions made up between 18% and 28% of sales last year. So, for the majority of buyers in our area, traditional financing is still the most common path. One exception is Rossmoor, a retirement community in Walnut Creek, where about 67% of sales were cash. But that’s not just about preference. Many homes in Rossmoor are co-ops, which can’t be financed with conventional or FHA loans. In those cases, cash isn’t just optional — it’s the only way in. Conventional loans, backed by Fannie Mae and Freddie Mac, are still the go-to for most buyers. In Contra Costa County, more than 86% of home purchases used conventional financing. These loans come with strong rates and fewer hoops to jump through for buyers with solid credit and income. FHA and VA loans, backed by the federal government, are also available, however they’re used less often—around 10% and 3%, respectively. These options work well for buyers who are putting less down or using VA Eligibility.
With home prices between $1.1 and $1.25 million in many East Bay neighborhoods, buyers are taking out sizeable loans. A 20% down payment puts the typical mortgage somewhere between $880,000 and $960,000. The conforming loan limit for both Alameda and Contra Costa in 2025 is $1,209,750. Going above that means you’re in jumbo loan territory, which usually comes with a few extra requirements, but is completely manageable with the right preparation. In this market, jumbo loans are simply part of the landscape and can offer lower rates to buyers with loan amounts beginning at $806,501.
If you’ve got questions or want to map out your next steps, let me know how I can help you best. Whether you’re ready to buy soon or just gathering info, I’m happy to walk you through what’s possible. You can reach me at evelyn.freitas@rate.com.
We are The Home Factor, REALTORS®, serving clients in the San Francisco Bay Area, and beyond.
Declan Spring · Declan@thehomefactor.com
(415) 446-8591 · DRE#01398898
Denitsa Shopova · Denitsa@thehomefactor.com
(510) 220-1634 · DRE#02137852
Ehsan Habib · Ehsan@thehomefactor.com
(510) 730-4516 · DRE#02166899
GUIDING AND INSPIRING PEOPLE TO INCREASE THEIR FINANCIAL STABILITY AND LOVE OF LIFE THROUGH WELL DESIGNED HOME OWNERSHIP
The Home Factor • DRE#01398898 • Powered by Keller Willams • 2089 Rose St, Berkeley, CA 94709 • Declan@TheHomeFactor.com · (415) 446-8591