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Market Update, California
Median price $899,720, average rent $2,749, and mortgage rates at 7.40 percent. Here is what the latest California housing market data means if you own a rental.
The California housing market entered the fall of 2026 with prices holding and sales thinning out. The statewide median barely moved between August and September, homes are still selling faster than they were a year ago, and the average rent in California is close to flat. What changed most since the summer is the cost of money. The 30-year fixed rate is back above 7 percent, and that pushes the buy-versus-rent arithmetic further toward renting than at any point this year.
The short version: C.A.R. put the September 2026 statewide median at $899,720, up 1.7 percent year over year and the fifth consecutive annual gain. Sales fell 6.5 percent from a year ago, unsold inventory held at 3.7 months, and Freddie Mac had the 30-year fixed at 7.40 percent on October 15, 2026. Principal and interest on the median home now runs about $4,984 a month against a $2,749 average rent, so the gap between renting and owning is the widest it has been in 2026.
| Metric | Latest reading | Change |
|---|---|---|
| Existing single-family sales pace | 260,410 annualized (Sept 2026) | Down 3.4 percent from August, down 6.5 percent year over year |
| Unsold Inventory Index | 3.7 months (Sept 2026) | Unchanged from August, slightly above 3.6 months a year ago |
| Active listings | Up 2.7 percent from August | Up 0.5 percent year over year, the first annual increase in eight months |
| Share of sales above $1 million | 35.9 percent (Sept 2026) | Up from 35.2 percent in August, reversing three monthly declines |
| Sales-price-to-list-price ratio | 98.8 percent (Sept 2026) | 98.2 percent in September 2025 |
| 30-year fixed mortgage rate | 7.40 percent (Oct 15, 2026) | Unchanged from the prior week, 6.27 percent a year ago |
The California median home price was $899,720 in September 2026, according to the California Association of Realtors, down 0.2 percent from $901,420 in August and up 1.7 percent from $884,390 in September 2025. C.A.R. noted that the monthly dip was smaller than the 1.8 percent decline that August to September usually brings, and that September was the fifth straight month of year-over-year price gains.
The composition of sales is part of why California home prices have held. The share of transactions above $1 million rose to 35.9 percent in September from 35.2 percent in August. The median price per square foot, which is less sensitive to the mix of homes sold, rose 1.4 percent on the month to $434 and 1.6 percent on the year, so the underlying price firmness is real rather than purely a composition effect.
Volume is the weak spot. Closed sales of existing single-family homes ran at a seasonally adjusted annualized 260,410 in September, down 3.4 percent from August and down 6.5 percent from a year earlier, the 48th consecutive month below the 300,000 unit mark. Supply has loosened only slightly: the Unsold Inventory Index held at 3.7 months, and total active listings rose 2.7 percent from August and 0.5 percent year over year, the first annual increase in eight months. C.A.R. attributes that listing growth to the pullback in sales rather than to new supply arriving, which is a meaningful difference for anyone reading it as a turn in the market.
Redfin, three months ending Sep 2026, all home types. Arrow shows change year over year. Bars are truncated at the San Jose value, so lengths compare but do not start at zero.
Rent: Zillow Rentals, California, Oct 19, 2026. Owning: principal and interest on the $899,720 C.A.R. September 2026 median at 20% down over 30 years, at the Freddie Mac rate of 7.40% on Oct 15, 2026 and at the year-ago rate of 6.27%. Taxes, insurance and HOA dues not included.
The California rental market has gone sideways. Zillow put the average rent in California at $2,749 as of October 19, 2026, up $23 from the previous month and down $47 from a year earlier, across about 86,956 available listings. That is roughly 37 percent above the $2,000 national average. By bedroom count Zillow has studios at $1,795, one-bedrooms at $2,095, two-bedrooms at $2,700 and three-bedrooms at $3,600.
A flat statewide average hides two markets moving in opposite directions. San Francisco, San Jose, San Diego and Berkeley are all up year over year on Zillow's numbers, while Los Angeles, Anaheim and Sacramento are down. For owners that means the statewide figure is useless as a pricing input and the submarket number is the one that matters.
Demand itself has not weakened. With principal and interest on a median-priced home now near $4,984 a month, households that would have bought in a cheaper rate environment are renewing instead. That shows up as steadier occupancy rather than aggressive rent growth.
| Market | Average rent | Year over year | What owners should note |
|---|---|---|---|
| San Francisco | $4,850 | Up $1,205 | Highest rents in the state and the sharpest annual move; Zillow updated Oct 18, 2026 |
| San Jose | $3,399 | Up $299 | Silicon Valley demand keeps the South Bay firm; 70 percent above the national average |
| San Diego | $3,132 | Up $47 | Essentially flat on the year, steady military and remote-worker demand |
| Berkeley | $2,928 | Up $275 | University demand creates a reliable leasing calendar on a thin 521-unit supply |
| Los Angeles | $2,650 | Down $125 | More than 18,000 listings competing; concessions are common on older units |
| Anaheim | $2,495 | Down $146 | The Orange County reference point; price against current comps, not last year's rent |
| Sacramento | $1,919 | Down $76 | The only large California market below the national average |
Zillow Rentals, all bedroom counts and property types. Page update dates range from October 3 to October 19, 2026. Oakland is omitted because Zillow's Oakland page was last updated in December 2025 and we will not publish a stale figure as current.
C.A.R.'s county-level active listing counts show the split. Twenty-seven of the 52 counties tracked had fewer active listings than a year earlier, led by Marin and Trinity at 32.1 percent down and Nevada County at 21.3 percent down. Twenty-five counties had more, led by Calaveras at 45.3 percent, Sutter at 27.6 percent and Santa Clara at 26.4 percent. Several of the biggest swings sit on small transaction counts, so read the small-county numbers as noise rather than signal.
On price, three of the five major regions gained year over year in September. The Central Coast led at 4.4 percent, Southern California followed at 3.0 percent and the San Francisco Bay Area at 1.9 percent. The Central Valley was flat and the Far North fell 3.4 percent. Month to month the Bay Area was the only region to rise, at 4.2 percent.
The San Jose housing market is the clearest example of a market that is expensive and getting easier to buy in at the same time. Santa Clara County's median was $1,920,000 in September 2026, up 1.1 percent from August but down 4.0 percent from a year earlier, one of the few large-county annual declines in the state. Active listings in Santa Clara County were up 26.4 percent year over year, the third largest increase in California. Redfin, which measures all home types over a rolling three months rather than existing single-family only, put the City of San Jose median at $1,349,357 for the three months ending September 2026, down 5.0 percent year over year, with homes selling in a median 22 days.
Rents moved the other way. Zillow has San Jose rent at $3,399 as of October 15, 2026, up $112 on the month and $299 on the year, about 70 percent above the national average. More inventory for buyers and higher rents for tenants is an unusually good combination for an owner who intends to hold. The wider average rent in the Bay Area runs well above the statewide $2,749, from $2,928 in Berkeley to $3,399 in San Jose and $4,850 in San Francisco. Our Saratoga and Gilroy offices cover this corridor.
The Orange County housing market is doing the opposite of the South Bay. C.A.R. put the Orange County median for existing single-family homes at $1,480,000 in September 2026, up 1.9 percent from August and up 5.6 percent year over year, one of the stronger annual gains among large counties, while sales fell only 2.0 percent. Redfin's all-home-types measure for Orange County was $1,207,298 for the three months ending September 2026, up 0.6 percent, with a median 47 days on market. The two figures are not comparable to each other, and the gap between them is methodology, not disagreement.
Southern California as a region had the state's largest annual sales decline at 9.1 percent even as its median rose 3.0 percent to $895,000, so prices there are being held up by a thinner, higher-end set of transactions. Rents have softened: Zillow had Anaheim at $2,495 on October 3, 2026, down $146 year over year, and the Los Angeles rental market at $2,650, down $125, with more than 18,000 competing listings. Our Orange office works this market, and the advice there right now is to protect occupancy rather than chase the asking rent you got last year.
Freddie Mac reported the 30-year fixed mortgage rate at 7.40 percent on October 15, 2026, unchanged from the previous week, up from 7.28 percent on October 1 and 7.03 percent on September 24, and far above the 6.27 percent of a year earlier. Rates have moved sharply since late summer. C.A.R.'s own calculation had the 30-year averaging 6.86 percent across September and 6.67 percent in August, so the September sales and price data predates most of this move. The October effect on demand is still ahead of us.
The arithmetic is blunt. On the $899,720 statewide median with 20 percent down, principal and interest is about $4,984 a month at 7.40 percent, against about $4,441 at last year's 6.27 percent. That is $543 a month added by the rate alone, before taxes, insurance or any price change. Against a $2,749 average rent, owning the median California home costs roughly $2,235 a month more than renting one, and the gap has widened every month this year.
For a rental owner that is the whole argument. Every month rates stay near 7.5 percent, the pool of renters who cannot yet buy stays larger, and tenants who would otherwise have given notice renew instead. It supports occupancy even while headline rent growth is flat.
If you own a covered California rental, AB 1482, the Tenant Protection Act, sets the ceiling on what you can raise. The cap is 5 percent plus the change in the local consumer price index, or 10 percent, whichever is lower, and no more than two increases are allowed in any rolling 12-month period. The CPI component is published regionally, so the real ceiling is different in the Bay Area than in Southern California, and you have to check the figure for your own county rather than assume a statewide number.
Two things trip owners up. A stricter local rent control ordinance overrides the state cap where one exists, and the law carries a just-cause eviction standard alongside the rent cap. AB 1482 is scheduled to sunset on January 1, 2030 unless the Legislature extends it. In a year where the statewide average rent is down $47, the practical constraint on most owners is the market rather than the statute, but the notice and documentation requirements still apply.
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Get Your Free Rental Analysis →It is flattening rather than falling. C.A.R. reported a statewide median home price of $899,720 in September 2026, down only 0.2 percent from August and up 1.7 percent from a year earlier, the fifth straight month of annual gains. What is cooling is volume: existing single-family sales ran at an annualized 260,410 in September, down 6.5 percent year over year and below the 300,000 benchmark for the 48th month in a row.
Zillow put the average rent in California at $2,749 as of October 19, 2026, up $23 from the previous month and down $47 from a year earlier, across roughly 86,956 available rentals. That is about 37 percent above the $2,000 national average. Rents range from about $1,919 in Sacramento to $4,850 in San Francisco.
The California median price for an existing single-family home was $899,720 in September 2026 according to C.A.R., against $901,420 in August and $884,390 in September 2025. The statewide median price per square foot was $434, up from $427 a year earlier, and 35.9 percent of September sales were above $1 million.
C.A.R. said in its September 2026 release that the combination of softer housing demand and the typical seasonal slowdown will likely apply more downward pressure on home prices for the remainder of the year, and that elevated borrowing costs and affordability pressure could keep weighing on buying activity through the final quarter. With the 30-year fixed at 7.40 percent on October 15, 2026, that is the only forecast the published data supports. Intempus does not publish its own price prediction.
AB 1482, the Tenant Protection Act, caps annual rent increases on covered properties at 5 percent plus the change in the local consumer price index, or 10 percent, whichever is lower, with no more than two increases in any 12-month period. The CPI component is set regionally, so the actual ceiling differs by county, and a stricter local rent control ordinance overrides the state cap where one exists. The law is scheduled to sunset on January 1, 2030.
They are hurting. Freddie Mac put the 30-year fixed rate at 7.40 percent on October 15, 2026, unchanged from the week before, up from 7.03 percent on September 24 and well above the 6.27 percent of a year earlier. Principal and interest on the $899,720 median home with 20 percent down is about $4,984 a month at 7.40 percent, against about $4,441 at last year's rate. That $543 difference is why more households are renewing leases instead of buying.
Sources: California Association of Realtors, September 2026 Home Sales and Price Report; Zillow Rentals, California rental market trends, October 19, 2026; Freddie Mac Primary Mortgage Market Survey, October 15, 2026; Redfin, San Jose housing market and Orange County housing market, three months ending September 2026; California Tenant Protection Act of 2019 (AB 1482). C.A.R. figures cover existing single-family detached homes; Redfin figures cover all home types on a rolling three-month window, so the two are not interchangeable. Figures are the most recent published readings at the time of writing and are provided for general information, not investment advice.
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