May '25 Deep Dive - Silicon Valley

The Local Lowdown

Quick Take:

Single-family median sale prices in Santa Cruz County have fallen on a year-over-year basis for the first time in over a year.
We’re seeing drastic increases in inventory across the board, as new listings flood the market.
Despite a flood of new listings hitting the market, homes are still being bought up relatively quickly.

Santa Cruz County breaks its winning streak

After over a year of uninterrupted growth, Santa Cruz County’s streak of rising single-family home prices ended in April, with the median sale price dropping 8.57% compared to this time last year. While that may seem like a sharp turn, a market cooldown is a natural and healthy response after such an extended period of acceleration. At the same time, the broader Silicon Valley market continues to show strength—median home prices in San Mateo and Santa Clara Counties are up 1.69% and 5.50% year-over-year, respectively, highlighting the region’s ongoing resilience.

Inventory levels are skyrocketing across the Silicon Valley

Inventory continued its upward climb in May, as new supply once again outpaced buyer demand. In the single-family home market, new listings rose 8.73% year-over-year, while closed sales edged up by just 0.79%—a dynamic that’s contributed to nearly 30% more active inventory compared to this time last year, marking a two-year high. The condo market is following a similar path, with a notable increase in new listings and a drop in closings, resulting in a 51.29% jump in available inventory year-over-year. For buyers, this shift means more choices—and more negotiating power—as the market rebalances.

Despite inventory issues, listings are still being snapped up at a breakneck pace!

Given the rise in inventory, you might expect homes to be sitting on the market—but that’s far from the case. In Santa Clara County, the average single-family home is snapped up in just 8 days. Homes in San Mateo and Santa Cruz Counties are moving quickly as well, averaging just 11 and 15 days on the market, respectively. The condo market is only slightly more forgiving, with average days on market at 22 in San Mateo, 14 in Santa Clara, and 30 in Santa Cruz—still remarkably swift by historical standards.

Witty title about Buyers vs. Sellers Markets

To gauge whether a market favors buyers or sellers, we look to the Months of Supply Inventory (MSI) metric. Historically, California has averaged around three months of supply—marking the threshold for a balanced market. Markets with less than three months of inventory are considered seller-friendly, while those with more are seen as buyer-friendly. Despite the recent jump in inventory, the single-family home markets in San Mateo and Santa Clara Counties remain firmly in seller territory, with just 1.7 months of supply. Santa Cruz County, on the other hand, has shifted into buyers' market territory with 3.5 months of supply. The condo market tells a similar story—buyers are gaining the upper hand, with MSI reaching 3.2 months in Santa Clara, 3.5 in San Mateo, and a notable 5.6 in Santa Cruz.

Bottom Line

Santa Cruz County’s year-long streak of rising single-family home prices came to an end in April with an 8.57% year-over-year drop, signaling a healthy market correction after sustained growth. Meanwhile, San Mateo and Santa Clara Counties continue to show strength, with home prices up 1.69% and 5.50%, respectively. Inventory is surging across the region, with new listings outpacing demand and contributing to a 30% rise in single-family home inventory and a striking 51.29% increase in condo inventory compared to last year. Still, homes are selling quickly—averaging just 8 to 15 days on market for single-family homes and 14 to 30 days for condos. Despite these shifts, San Mateo and Santa Clara remain strong seller’s markets with only 1.7 months of supply, while Santa Cruz and the condo market overall are tipping in favor of buyers.

Monthly condo days on market in San Mateo, Santa Clara, and Santa Cruz counties, April 2023–April 2025.