East Bay December '24 Real Estate Update Ascend RE

The Local Lowdown

Quick Take:

Median home prices rose slightly in November, which is normal for the East Bay this time of year. Prices generally contract in the second half of the year, and we expect prices to decline through January 2025.
Total inventory decreased 24.5% month over month, as new listings fell more than sales. We expect inventory to decline and the overall market to slow over the next two months.
Months of Supply Inventory still indicates a sellers’ market in the East Bay for single-family homes, but for condos, MSI implies the market is now more balanced.

Median home prices rose slightly month over month in the East Bay

In the East Bay, home prices have remained resilient despite rising mortgage rates, with low but growing inventory and high demand offsetting downward pressure. As of November, median prices for single-family homes rose 4% in Alameda and 2% in Contra Costa, while condo prices increased 15% and 10%, respectively. Prices peaked in summer, with mild post-peak declines as expected, and are likely to dip slightly over the next two months. While rates near 6% were more tolerable for buyers and sellers, the recent rise toward 7% is expected to further slow sales.

Inventory, new listings, and sales fell

The 2024 housing market shows steady improvement, with inventory levels better than expected, though single-family home inventory remains low. In 2023, inventory followed seasonal trends but at much lower levels, slowing the market. This year, increased new listings have boosted inventory, with condo inventory hitting a four-year high in September before declining in October and November. Single-family home inventory is slightly up year over year but dropped month over month due to fewer new listings. 2024 inventory, sales, and listings are expected to follow typical seasonal patterns at more normal levels than last year.

Months of Supply Inventory in November 2024 indicated a sellers’ market for single-family homes and a balanced market for condos

Months of Supply Inventory (MSI) measures how long it takes to sell current listings at the current sales pace. A three-month MSI is balanced, while below three favors sellers and above three favors buyers. The East Bay market favors sellers for single-family homes due to consistently low MSI. In 2024, condo MSI fluctuated, shifting between sellers’, buyers’, and balanced markets. Single-family home MSI remains low, though it has risen slightly this year.

The bottom line

The 2024 East Bay housing market shows resilience, with steady price growth despite high mortgage rates. Single-family homes remain a sellers’ market with low MSI, while condos fluctuate between balanced and buyers’ markets. Inventory has improved from 2023 but remains tight, especially for single-family homes. Rising rates may slow sales, but the market is expected to follow typical seasonal trends at more stable levels.