San Francisco Bay Area Housing Market Update, June 26 2025

In a recent video I did on the biggest home price declines for large metropolitan areas, the Oakland, California metro was number two on the list. And in today's video, we're going to look at the latest housing market data for Oakland and the other large metropolitan areas in the San Francisco Bay Area to get a sense of where the region is headed in the months ahead. Let's get Welcome to Real Estate Watch, the channel that focuses on forward-looking real estate analysis for the US and regional markets. My name is Eric, professional economist and licensed real estate agent. Let's get right into the latest data for the Bay Area. According to Redfin, a national real estate brokerage, the Oakland metro area median home price in April was $904,000 on a seasonally adjusted basis, which is down 11.5% from the all-time high in April 2022. San Jose metro area has had a very different experience with a median price of $1.6 million in April. It is up 6.2% from that April 2022 peak. San Francisco metro area was in between the two with a median price of $1.5 million. It's down 7.5% from that pandemic era peak. Looking at the demand side of the market, home sales for the Oakland metro is still well below pre-pandemic levels, whereas San Jose and San Francisco are closer to where they were before, but still a bit below pre-pandemic levels. This makes sense given what we're seeing in the price performance for these areas. Oakland has the biggest price decline and also has the weakest demand of the three. Let's take a look at what is going on with supply. This is the month's supply for the three areas. It measures how fast the market inventory would be exhausted at the current pace of sales. Notably, both Oakland and San Francisco are above where they were before the pandemic, and both of them have negative price performance since the pandemic era peak. San Jose is still below where it was before the pandemic in terms of supply, which helps explain its positive price performance since the pandemic peak. The housing supply situation for these metros makes a big difference. Even if demand is weak, if supply is tight, we're not likely to see price declines. For both Oakland and San Francisco, supplies above where it was before the pandemic in both areas have seen price declines from the recent peak. San Jose is the opposite. Supply is still below pre-pandemic levels, and prices are up from the April 2022 peak. But beyond these market statistics, we also need to consider a big economic factor, the tech industry, and what happened during the pandemic. Silicon Valley is located in the San Jose metropolitan area, and during the pandemic, the work-from-home phenomenon went into full swing. This allowed tech workers to work from anywhere and take advantage of relatively lower home prices in other areas. The Oakland metro area was ideal for this. Home prices are lower than in San Jose, but it's still geographically close enough to Silicon Valley that they could commute to the office occasionally if needed. I think this is one of the reasons we saw the big run-up in prices in Oakland. Fast forward to today, and more companies want employees in the office, which has led to weaker demand for Oakland area housing and stronger demand for housing in San Jose. Now for the big question. Given where the market is today, could we expect prices in the Oakland area to continue to decline in the months ahead, or are the big price declines over? For that, I like to look at where things stand on an affordability basis. Here's a chart of the average housing payment as a percent of household income. One thing you might notice is that even before the pandemic, this percent was regularly above 30%, the point at which the government says a household is cost burdened. The high percentages here reflect the affordability crisis in the Bay Area, but that's a topic for a different video. But what we can see historically is that before the pandemic, this stayed within a range of 35% to 40%. As of April, it was at 49%. Based on where things stand from an affordability basis, as well as the trend of rising supply, I think we could see more price declines for the Oakland area in order for the market to get back into balance. But I don't think it will get too extreme at this time. If you live in the Oakland metro area, which is Alameda and Contra Costa counties, I would love to hear what your housing market experience has been. Do you think prices will keep heading lower or is the worst behind us? Let me know in the comment section down below. If you like this kind of housing market analysis, make sure you are subscribed to this channel and hit that notification bell down below so you won't miss my next video when it comes out. And if you could do me a favor and hit that like button down below to support the channel and help it grow, it would be greatly appreciated. Thanks for stopping by. I'll see you in the next video.