California home sales drop to ‘lowest level.’ Where to find low prices at $255K
Buying a home in California often means navigating a competitive market, with searching, negotiating and paying a high price.
However, the Golden State’s real estate market is beginning to cool.
According to the California Association of Realtors, home sales in January fell “to their lowest level since May 2025” as prices dropped to a nearly two-year low.
Existing home sales reached a seasonally adjusted annual rate of 256,550 in January. That’s down 10.8% from December’s 287,570 sales and 1.3% lower than the 260,040 homes sold in January 2025, the Realtors group’s latest home sales and price report shows.
The statewide median home price in January was $823,180 — which is a 3.2% drop from December’s $850,680 and down from $839,130 this time last year.
“After closing out 2025 on a strong note, California’s housing market has started the new year on a softer footing, with both sales and prices coming in below last year’s levels,” Tamara Suminski, California Association of Realtors president, said in the Feb. 18 report.
According to real estate experts, housing market conditions are improving for potential homebuyers.
“As mortgage rates ease toward recent lows and housing supply is expected to improve in the coming weeks, we anticipate momentum to build as the market heads into the spring home buying season,” Suminski said.
If you’re planning to buy a home, here’s a closer look at current mortgage rates, average home prices and where you can still find properties listed below California’s median price.
What are current mortgage rates in California?
Mortgage rates in California have eased “toward recent lows,” according to the California Association of Realtors.
“California’s housing market pulled back in January as heightened policy uncertainty and geopolitical tensions contributed to increased volatility in mortgage rates early in the year,” said Jordan Levine, California Association of Realtors senior vice president and chief economist.
As of Tuesday, Feb. 24, the average 30-year fixed mortgage rate in California was about 5.88%, according to Zillow.
The California Association of Realtors expects rates to stay below 6% in 2026.
“More recent economic indicators, however, suggest that the broader economy is beginning to stabilize, which should help restore confidence among both buyers and sellers,” Levine said in the Feb. 18 report. “With pending home sales posting a solid gain last month, we anticipate a rebound in housing market activity in February.”
Where can I find lowest home prices in California?
According to the latest report from the California Association of Realtors, the state’s most affordable home prices are mostly in Northern California and the Central Valley.
Based on the January 2026 home sales and price report released Feb. 18, these 10 counties had median home prices below the statewide average of $823,180:
1. Lassen County — $255,000
2. Trinity County — $290,000
3. Lake County — $312,000
4. Glenn County — $340,000
5. Tehama County — $347,000
6. Plumas County — $350,000
7. Siskiyou County — $359,000
8. Mariposa County — $369,750
9. Tulare County — $375,000
10. Kings County — $383,000
Where are the highest housing costs in California?
The California Association of Realtors reported that the state’s priciest homes are mostly in the Bay Area.
In January, the median price for a single-family home in the region reached $1,127,000.
The five counties with the highest median prices for existing single-family homes were:
1. San Mateo County — $2 million
2. Santa Clara County — $1,807,500
3. San Francisco County — $1,653,320
4. Marin County — $1,527,000
5. Santa Barbara County — $1,475,000
How much do homes cost in my California county?
Find the full list of home prices by county on the California Association of Realtors website.
This story was originally published February 25, 2026 at 5:00 AM with the headline "California home sales drop to ‘lowest level.’ Where to find low prices at $255K."
