Bay Area

Quick Take

• August delivered a split decision on single-family pricing: San Francisco jumped 23.33% and Marin gained 15.83% year over year, while Sonoma, Solano, Napa, Santa Clara, and Santa Cruz Counties all finished a touch under their August 2024 marks.

• Available listings thinned out everywhere, with San Francisco shedding 33.19% of its single-family supply and the North Bay giving up 29.62%, while condo counts fell even harder in both areas.

• Detached homes are changing hands in about two weeks throughout the region's core counties, and San Francisco condos produced the standout improvement of the year, selling in 19 days compared with 51 a year ago.

• Months of supply declined in nearly every segment tracked, taking San Francisco condos to 1.6 months and San Mateo County condos to 2.5 months, leaving East Bay and outer North Bay condos as the remaining strongholds for buyers.

One region, several very different markets

Reading the Bay Area's August price data as a single trend line does not work.  San Francisco posted the region's strongest annual gain, with the median detached home reaching $1,850,000 against $1,500,000 last August, a 23.33% increase.  Marin County ran a close second at $1,778,000, up 15.83%.  San Mateo County remained the most expensive county in the region at $2,050,000, a 7.89% annual gain and its sixth consecutive month north of $1.9 million.  Those three counties accounted for essentially all of the region's headline appreciation.

Outside that trio, annual changes hovered right around zero or drifted slightly negative.  Santa Clara County registered $1,850,000, a 1.70% decline, and Santa Cruz County landed at $1,350,000, off 1.60%.  Sonoma gave back 4.46% to $793,000, Solano retreated 7.26% to $575,000, and Napa softened 3.06% to $950,000.  The East Bay landed in between, as Alameda County ticked up 0.71% to $1,269,000 and Contra Costa County advanced 2.98% to $865,000.  Most of these counties also came off their spring highs, a pattern that reflects the normal calendar rather than any underlying weakness.

The condo market was even more uneven.  San Francisco condos mirrored the city's detached performance at $1,260,000, a 23.53% annual gain and a third straight month holding the $1.2 million range.  Alameda County condos inched up 2.37% to $562,500, and Marin condos added 0.81% to $723,313.  The declines, though, were meaningful: Contra Costa condos fell 12.75% to $444,950, Napa condos dropped 16.74%, Santa Clara condos gave up 6.16% to $685,000, and both Sonoma and Solano condos closed below last August.  Because monthly condo sale counts are small in many of these counties, the swings get exaggerated in both directions.  Santa Cruz County's 16.11% condo increase to $800,000 warrants the same measure of skepticism as Napa's drop.

The supply squeeze is regionwide, and sellers are not the cause

The single statistic that best captures the Bay Area in August is how little there was to buy.  San Francisco closed the month with only 159 detached homes and 348 condos on the market, declines of 33.19% and 36.38% from a year earlier.  North Bay single-family inventory fell 29.62% to 2,778 homes, while its condo count dropped 23.30% to a mere 349 units.  The East Bay listed 2,662 detached homes, down 16.68%, alongside 934 condos, down 9.58%.  Silicon Valley offered 1,856 single-family homes, off 11.62%, and 765 condos, off 13.27%.

The notable part is that homeowners largely showed up.  New detached listings actually increased 9.51% year over year in Silicon Valley, 8.72% in San Francisco, and 3.76% in the East Bay.  In every one of those markets, buyers cleared the shelves faster than sellers could restock them.  San Francisco illustrated the dynamic most vividly: new condo listings grew 15.84% and closed condo sales rose 14.81%, yet standing inventory still fell.  The North Bay was the lone genuine supply story, where new single-family listings dropped 17.84% and new condo listings fell 26.92%, even as single-family sales rose 4.20% and condo closings climbed 19.75%.

Silicon Valley was the only market where softer demand contributed to the tightening.  The county recorded 1,073 detached sales in August, down 7.58% from last year and 12.48% below July.  With both closings and listings moving lower together, the market stays competitive without tipping into a frenzy.

Fourteen days, give or take, across most of the region

Detached homes sold faster than a year ago in nearly every county.  San Mateo County led at 12 days, with San Francisco and Santa Clara County at 13 and Alameda County at 14.  The biggest year-over-year swing belonged to Santa Cruz County, which cut its marketing time to 17 days from 26, a 34.62% improvement for a county that was posting figures in the 40s during the winter.  Contra Costa County recorded 20 days and Marin 21, the latter a 27.59% gain on last August.  The outer edges of the North Bay continue to move at a different tempo, with Solano at 29 days, Sonoma at 39, and Napa the slowest detached market in the region at 53 days.

Condos are where the region splits in two.  San Francisco condos found buyers in 19 days, a 62.75% improvement from the 51 days they needed last August, narrowing the gap with detached homes to under a week after years of trailing by five weeks or more.  The East Bay was consistent, with Alameda and Contra Costa condos both at 32 days.  Silicon Valley condos grouped in the mid-30s, from 35 days in Santa Clara County to 37 in San Mateo.  The North Bay went the opposite way, with every county's condo segment losing speed: Marin at 49 days, Solano at 55, Sonoma at 61, and Napa stretching to 100 days on a very small number of transactions.

Sellers keep the advantage as buyer-friendly pockets shrink

When determining whether a market is a buyers’ market or a sellers’ market, we look to the Months of Supply Inventory (MSI) metric.  The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market.  Any market that has lower than three months of MSI is considered a seller’s market, whereas markets with more than three months of MSI are considered buyers’ markets.

Applying that standard, the Bay Area's detached market belongs to sellers nearly across the board.  San Francisco registers a remarkable 0.8 months of supply, a 38.46% annual decline, which means the city's entire single-family inventory would sell through in roughly 24 days at August's pace.  San Mateo County reads 1.2 months, Santa Clara County 1.6, Alameda County 1.9, and Marin County 2.0 following a 54.55% year-over-year drop from 4.4 months.  Contra Costa County sits at 2.4 and Solano County at 2.8.  Santa Cruz and Sonoma Counties, both at 3.4 months, are the only counties that read close to balanced, and Napa County is the region's sole buyers' market at 6.1 months, although that is well down from 9.1 months last August.

Condos still offer buyers some footing, but the ground is shrinking underneath them.  San Francisco condos have compressed to 1.6 months from 3.1 last August, a 48.39% decline that closes the book on that segment as the region's dependable buyer alternative.  San Mateo County condos moved into seller's territory at 2.5 months, down 34.21%, and Marin condos settled essentially at balance, 3.1 months after a 41.51% improvement.  Past those, buyers still have real room to negotiate: Santa Clara County condos at 3.7 months, Sonoma at 3.7, Contra Costa at 4.0, Alameda at 4.1, Solano at 4.2, Santa Cruz at 4.3, and Napa at 6.6.  Every single one of those figures moved in the seller's favor compared with a year ago, and that uniformity is the month's defining takeaway.  As the fall season begins, anyone shopping for a detached home in the Bay Area should plan on competition and arrive fully prepared, while condo buyers working the East Bay, the outer North Bay, and the southern portions of Silicon Valley continue to hold the most leverage available in this region.