Monthly report · No.19
FRIDAY, OCTOBER 24, 2025
the state of the market
The Housing Factor
By Ehsan Habib
*Data is sourced from the MLS and considers detached Single-Family Homes
It’s Spooky Season! Let’s see if anything spooky is happening in the Inner East Bay housing data.
We’re seeing some encouraging signs that Sellers have been adjusting to a changing landscape. Average and Median Days on Market (DOM) in September have reduced from their August numbers, in line with seasonal trends, as Sellers removed stagnant Summer listings and Buyers met the post Labor day surge in inventory. September 2025 saw a 2% increase in new listings Year-over-Year (YoY), but an 8% increase in the number of listings sold. So, not only are more people looking to sell property, but an even greater share of them are finding success on the market. The steadily declining interest rates certainly don’t hurt (currently trending down from 6.2%).
In addition to the 7.5% decline in Median Sale Price, further evidence that the market is adjusting is the list prices that Sellers are using to market their homes. The median list price is down 8.1% YoY (from $925K to $850k), and the Average list price is down 6.7% YoY. Pricing dynamics, and the East Bay custom of “listing low to sell high”, is as entrenched as ever. The median home still sold over 5% over its price in 2024 and 2025. In 2024, homes sold an average of 12.3% over their list price; in 2025, that number rose to 13.3%. What we are seeing is that Sellers are recognizing weaker sale prices, lowering their list prices accordingly, and taking reasonable offers.
The Inner East Bay is a decidedly competitive and expensive market. However, for the past 2 years, we have seen the imbalance between supply and demand grow to levels not seen since the Great Recession. Months Supply of Inventory is the measure of the number of homes for sale, divided by the number of sales over the previous 30 days. This metric shows, at the current rate of demand, how many months it would take for all existing inventory to be absorbed by the market - and it is a very useful metric for measuring the velocity of a market.
Months Supply of Inventory (All Single Family Homes) since 2008
Months Supply of Inventory (All Single Family Homes) since 2015
It bears mentioning that our Inner East Bay Market is an extraordinarily competitive market that had never risen above 1.5 months of inventory in the past decade. Starting in 2023, these long term trends started to shift. 2025 was the first year since 2012 that we did not dip below 1 Months Supply of Inventory at any point in the year. We should see this number decrease with the data from November and December. If you find these trends as riveting as we do, make sure to subscribe to Declan’s Substack, where you can see our Weekly Market Update!
And of course, for data specific to your city or neighborhood, or any insights and strategies specific to your situation, please reach out to either myself or Declan directly. We both regularly log data directly from the MLS, and we don’t know anyone else who takes the time to study the market so thoroughly.
Mortgage news
MORTGAGE MUSINGS
By Evelyn Freitas | VP of Mortgage Lending at Guaranteed Rate NMLS 247578
Will Lower Rates Make Home Prices Go Up Again?
After an extended period of elevated interest rates driven by the Federal Reserve’s efforts to control inflation, the average 30-year fixed mortgage rate dropped to 6.27% as of October 16, 2025, according to Freddie Mac. That’s the lowest level of the year — and nearly two full percentage points below the 2023 highs.
A Subtle Shift in the Market
This rate improvement offers welcome relief for buyers who have been watching from the sidelines. Many are beginning to re-evaluate options, check affordability, and revisit conversations about pre-approval. Activity is slowly picking up, though it’s not a surge — more of a gradual re-entry as confidence rebuilds.
Seasonal Slowdown, Not a Standstill
At the same time, we’re heading into the winter holiday season, when real estate traditionally slows. Open-house traffic remains modest, and there are fewer multiple offers. For now, the market feels steady rather than hot — a period of quiet recalibration as lower rates start to rekindle buyer interest.
What to Expect Next
Looking ahead, the Federal Reserve has signaled the possibility of two additional rate cuts before the end of 2025 if inflation continues to ease. If those cuts occur, mortgage rates could edge lower, drawing more buyers back into the market and creating gradual upward pressure on prices. Remember that the Fed’s actions affect the short-term federal funds rate — not mortgage rates directly. Even so, these policy actions often influence long-term investor sentiment and bond yields, which do impact mortgage pricing.
Making the Most of Today’s Market
Whether you’re considering a purchase, sale, or refinance, this is an ideal time to review your plans, explore updated loan scenarios, and understand how today’s rates might open new possibilities.
Interested in seeing what this means for you?
Let’s review your unique situation and create a tailored strategy that aligns with your goals before the next market shift. You can always reach me at evelyn.freitas@rate.com.
HOW MUCH EQUITY DID YOU GAIN THIS YEAR (OR LOSE)?
By Declan Spring
Recently a good amount of people have asked me the same question:
“How much is my home actually worth now?”
Online estimates can be wildly off. They can’t see your view, your remodel, or how your street compares to the one around the corner. A professional valuation does.
Even if you’re not thinking about selling, knowing your home’s true market value helps you:
Track how much equity you’ve gained over the past year
Plan future upgrades or financing with confidence
Stay informed about neighborhood trends and comparable sales
When I prepare a valuation, I dig into the recent comps, analyze closed sales, and factor in details the algorithms miss. The result is an accurate, data-backed picture of your property’s position in today’s market.
Would it be helpful if I prepared one for your home?
Just reply to me at Declan@thehomefactor.com and I’ll get started!
SUBSTACK: WHY our monthly newsletter isn’t enough
By Declan Spring
Think you’re “in the know” from our monthly recap? Think again. Real estate markets move fast, and a once-a-month snapshot can’t keep up.
That’s where our Weekly Substack comes in — it’s your early-warning system, unpacking fresh inventory data, interest-rate shifts, neighborhood trends, and hidden opportunities well before the headlines catch up.
Every issue delivers:
Local open-house & listing insights
Real-time rate analysis
Tactical tips for buyers, sellers, and refinancers
Market signals you won’t see anywhere else
Make your decisions with confidence — not hindsight.
Click here to subscribe to our weekly Substack now and stay one step ahead.
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