September 2025: Real Estate Trends in the SF Bay Area from San Mateo's Top Realtors
- Kevin Peterson
- 16 minutes ago
- 14 min read
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Executive Summary: Five SF Bay Area Counties Proprietary Market Analysis
Lower rates and a friendlier Fed stance helped unlock late-month buyer activity. Price stability continued despite rising inventory in select tiers, as tech-driven job growth and steady household formation kept demand solid. Sellers retained leverage in sub-$3.3 M homes, but negotiations expanded elsewhere.
The late-summer cooldown continued through September 2025, but the story differs by property type.
Single-family homes (SFRs) held steady in both price and speed, with a median price of $1.822 M and 27 days on market.
Condos softened slightly, with a median price of $889 K and 46 DOM, though buyer activity improved as rates fell mid-month.
Months of Supply:
SFR = 1.9 months (up from 1.8 in August) → still a seller-leaning market.
Condo = 3.5 months (down from 3.7) → moving toward seller-leaning but still a neutral market.
Market Pulse
SFRs $1.3 M–$3.3 M remained competitive with mild overbids (~101–103 %).
Luxury ($3.8 M +) and condos ($1.3 M +) saw more negotiation space.
The Fed’s 25 bps cut and mortgage rates slipping into the mid-6 % range revived some buyer urgency late September.n market are short and both list-to-ask ratio and price per square foot is increasing.
Key Housing Metrics (Sep vs Aug 2025)
Metric | Aug 2025 | Sep 2025 | Trend |
Median SFR Price | $1.81 M | $1.822 M | ⬆ (+0.7 %) |
SFR DOM | 25 | 27 days | ⬆ (slight slowdown) |
Median Condo Price | $887 K | $889 K | ⬆ (flat to mild gain) |
Condo DOM | 49 | 46 days | ⬇ (faster turn) |
SFR MOS | 1.8 | 1.9 months | ⬆ |
Condo MOS | 3.7 | 3.5 months | ⬇ |
Economic Update (Aug → Sep 2025)
Indicator | August 2025 | September 2025 | Direction |
Federal Funds Rate | 5.00 % | 4.75 % (-25 bps cut on Sept 17) | ⬇ |
30-yr Mortgage Rate (Freddie Mac PMMS avg) | 6.63 % | 6.27 % | ⬇ |
10-yr Treasury Yield | 4.35 % | 4.19 % | ⬇ |
CPI ( YoY ) | 3.2 % | 2.9 % | ⬇ |
S&P 500 Monthly Change | -1.8 % | +3.5 % | ⬆ |
NASDAQ-100 Monthly Change | -2.4 % | +5.4 % | ⬆ |
What It Means for...
Buyers
Use mid-6 % rates + lower competition to negotiate credits or 2-1 buy-downs.
Luxury buyers should leverage specific lenders relationship money discounts
Sellers
Price just below psychological thresholds ($2.99 M vs $3.0 M).
In luxury or condo segments, lead with staging + incentives to stand out.
Investors
Alameda SFR ($1.3 M–$1.8 M) and Contra Costa ($1.8 M–$2.3 M) remain yield-efficient.
Consider condo pickups in Santa Clara and SF at >$1.3 M with discounts ~2–3 %.
Table of Contents:
SF Bay Area Real Estate Price Trends
KPeterson.realty Proprietary Heat Maps
The charts below are month-over-month and year-over-year heat maps of pricing in the SF Bay Area. They are grouped by county and property type (Condo, Single Family Home, Townhouse). The metrics are Price per Square Foot, Days on Market, how many sold, and the List to Sales Price Ratio. We've now also included average square footage at each price level.
Green highlighted cells indicate items keeping prices up in comparison to previous month's metrics.
Red highlighted cells indicate the opposite, i.e downward pressure on sales price which favor buyers more.
Enlarge each county Heat Map by clicking on each of the images.
SF Bay Area Real Estate Market Matrix - September 2025
County | Property Type | Market Type | Best Price Points for Sellers | Best Price Points for Buyers |
San Mateo | Condos | 🛑 Buyer-Leaning | None — most tiers at/below list, DOM 56+ | <$800K (long DOM, prices softening) |
SFR | ✅ Seller | $1.3M–$3.3M (103–105% list-to-sale, DOM 22–29) | <$800K (DOM ~35+, weaker demand) | |
Townhomes | ⚖️ Neutral | $800K–$1.3M (100% list-to-sale, DOM ~28) | Higher tiers (DOM longer, flat pricing) | |
Santa Clara | Condos | ⚖️ Neutral | <$800K (99–100% list-to-sale, DOM mid-40s) | $1.3M+ (DOM 43–49, prices softening) |
SFR | ✅ Strong Seller | $1.3M–$2.8M (102–105% list-to-sale, DOM ~23–26) | <$800K (DOM 35+, PPSF not growing) | |
Townhomes | ✅ Seller | $1.3M–$1.8M (105% list-to-sale, DOM 27–30) | <$800K (DOM 40+, prices down) | |
Alameda | Condos | ⚖️ Neutral | <$800K (99% list-to-sale, DOM ~52) | $800K–$1.3M (DOM 40+, flat YoY) |
SFR | ✅ Seller | $1.3M–$2.3M (102–105% list-to-sale, DOM 23–29) | <$800K (DOM 35+, PPSF lagging) | |
Townhomes | ⚖️ Neutral | $800K–$1.3M (100–102% list-to-sale, DOM ~37) | <$800K (DOM 37+, slower absorption) | |
Contra Costa | Condos | ⚖️ Neutral | <$800K (99–100% list-to-sale, DOM 30–35) | $1.3M+ (DOM rises, thin sales) |
SFR | ⚖️ Neutral | $800K–$1.3M (101–103% list-to-sale, DOM ~27–32) | $2.3M+ (DOM 30–40, 95–98% list-to-sale) | |
Townhomes | 🛑 Buyer | N/A | All price points (DOM elevated, 99–100% list-to-sale) | |
San Francisco | Condos | 🛑 Buyer | N/A | All tiers (DOM 69, ~100% list-to-sale, flat PPSF) |
SFR | ✅ Strong Seller | All tie |
20-Year vs. 10-Year Appreciation
Bay Area single-family home prices have historically doubled every 10 years, thanks to a strong local economy and limited supply. Average sale price remained near the all-time high, showing continued strength.
As of this month...
Single family home appreciation over 10 years = 7.1% per year
Condo appreciation over 10 years = 3.3% per year
SF Bay Area Inventory Metrics
Active vs. Sold Listings
Active listings are homes currently on the market, while sold listings reflect homes that have successfully closed. When sold listings outpace active ones, it signals strong demand and favors sellers with faster sales and higher prices; when active listings outnumber sold ones, it suggests more supply and gives buyers more negotiating power and choice.
San Francisco Bay Area Real Estate Market Update – September 2025
Single-Family Homes – September 2025
Month-over-Month Trends:
Active listings in the Bay Area declined slightly from August 2025, following typical late-summer seasonality.
The $1.3 million to $3.3 million price range remained the strongest segment, selling 101% to 103% over list price in about 25 to 30 days on market.
Luxury single-family homes priced above $3.8 million continued to cool, with longer days on market (30 to 40+) and more properties selling at or below asking price.
Year-over-Year Comparison:
Compared to September 2024, inventory increased modestly, but steady buyer demand kept competition healthy.
Family homes near top-rated schools continued to attract multiple offers and sell quickly.
Average overbids softened to around 102% to 103%, down from the 105%+ range seen a year ago.
Historical Perspective:
Inventory remains well below long-term averages from 2008 to 2012 and pre-pandemic levels.
The single-family market still leans toward sellers, though higher-end homes are adjusting faster than mid-range family properties.
Condominiums – September 2025
Month-over-Month Trends:
The Bay Area condo market saw supply hold steady while buyer activity improved slightly after mid-September mortgage rate cuts.
Luxury condos priced above $1.3 million continue to see 45–55 days on market, with many selling at or below list price.
Entry-level condos below $900,000 experienced more showings and faster sales.
Year-over-Year Comparison:
Condo inventory is higher than in September 2024, especially in San Francisco, San Mateo, and Santa Clara counties.
Most closed sales occurred in smaller or transit-accessible buildings as affordability pressures persisted.
Buyer sentiment remains cautious but opportunistic, with more investors re-entering select markets.
Historical Perspective:
Condo inventory has returned to early-2020 levels, well above the post-pandemic lows of 2021–2022.
The Bay Area condo market is now firmly buyer-friendly, offering room to negotiate prices, credits, and closing terms.
Final Takeaway:
Segment | September 2025 Status | Trend vs August | Long-Term Comparison |
Single-Family Homes | Inventory held steady at low levels; $1.3M–$3.3M range stayed competitive with quick sales and mild overbids. Luxury ($3.8M+) slowed further with longer DOM and more price negotiations. | ⚠️ Momentum easing slightly at higher tiers. | ✅ Still seller-leaning, with inventory far below 2008–2012 and pre-pandemic levels. |
Condominiums | Supply remained high but buyer activity improved slightly as rates dipped. $1.3M+ condos continued to see slow absorption, while entry-level units (<$900K) moved faster. | 📉 Buyer leverage expanding in luxury and urban segments. | ⚠️ Inventory back to early-2020 levels; overall a balanced-to-buyer-friendly market. |
Months of Supply
The time it would take to sell all active listings at the current sales rate.
20-Year vs. 10-Year Months of Supply
This metric tells us how hot the markets are currently, i.e. the rate of change. If no new listings were added, this metric tells us how long it would take to sell all the remaining active homes. In the last 10 years, we have been in a Seller's Market except for condos in the year of 2020, when the COVID Pandemic hit.
Buyer's Market = Over 6 months of supply
Seller's Market = Under 3 months of supply
🏡 San Francisco Bay Area Housing Supply – September 2025
Single-Family Homes (SFR) – September 2025
Months of Inventory (MOI): 1.9 months, up slightly from 1.8 in August 2025.
The SFR market remains seller-leaning, with limited inventory and steady buyer demand.
Compared to last year, inventory is higher than September 2024 but still well below 2022–2023 levels, keeping competition strong—especially in the $1.3M–$3.3M price range where most homes sell quickly and over asking.
Summary: Demand outpaces supply in family-friendly neighborhoods, while luxury homes above $3.8M are taking longer to sell.
Condominiums – September 2025
Months of Inventory (MOI): 3.5 months, down from 3.7 in August, showing mild improvement in absorption.
The condo market remains balanced to buyer-friendly, especially for urban and luxury condos ($1.3M+) where supply continues to exceed demand.
Entry-level condos below $900K are seeing faster turnover as rates decline and investors re-enter the market.
Summary: Buyers have more leverage in higher-priced condos, while affordable and well-located units are attracting stronger activity.
Quick Market Summary – September 2025
Segment | Buyer Advantage | Seller Advantage | Key Insight |
Single-Family Homes | ❌ Low | ✅ High | Sellers continue to hold leverage in the $1.3M–$3.3M range; homes move fast with limited supply. |
Condos | ✅ Moderate | ⚠️ Weak | Buyers benefit from more inventory and negotiation room in $1.3M+ and urban areas; sellers must price sharply and offer incentives. |
Demand Indicators
% Over Asking vs. DOM (12-Month Look Back)
How much over asking a home sold for and how fast it was sold, i.e. Days On Market are the next two Key Performance Indicators (KPIs) for our SF bay area real estate trends. These show how much demand there is for SF Bay Area single family homes and condos.
Days On Market measures how long it takes for homes to sell.
Buyers: Longer DOM gives more room for negotiation.
Sellers: Shorter DOM indicates strong interest.
🏡 Single-Family Homes – September 2025
Sale-to-list ratio: ~102% 📉 (down from 103% in July) → overbids shrinking.
DOM: 28 days 📈 (up from 26 in July) → homes taking longer to move.
Takeaway: Still seller-leaning, especially $1.3M–$3.3M family homes, but momentum cooling at luxury tiers.
Condominiums – September 2025
Sale-to-list ratio: ~99% (flat compared to August) → buyers continue to negotiate on price and credits.
Days on Market (DOM): 46 days (improved from 49 in August) → modest uptick in buyer activity as mortgage rates dipped mid-month.
Takeaway: Still a buyer-leaning condo market, especially for $1.3M+ luxury and urban units. Well-priced entry-level condos are moving faster, but sellers in higher tiers must focus on competitive pricing, strong presentation, and incentives to attract offers.
Pending Sales
Homes under contract, i.e. Pending, show how quickly the market is moving.
The graphics below display the pending sales for all five counties, categorized by home types and price levels. The price tiers with the highest volume of pending sales for each home type and county are highlighted in yellow. For example, in San Mateo County, the most condos are sold at prices below $800K, while the most single-family homes and townhouses are sold between $800K and $1.3M. The color coding or heat map indicates changes compared to the previous month, with positive impacts on sales prices highlighted in green and negative impacts highlighted in red.
✅ Green (Seller-Favorable) Patterns – September 2025
(All three metrics aligned: Price/SqFt ↑, DOM ↓, Pending ↑)
San Mateo — SFR $1.3M–$2.3M (103–105% list-to-sale, DOM ~22–27)
Alameda — SFR $1.3M–$2.3M (102–105% list-to-sale, DOM mid-20s)
Santa Clara — SFR $1.3M–$2.8M (strong over-asking, DOM ~23–26)
San Francisco — SFR all mid-tier ($1.3M–$2.3M) (🔥 113% list-to-sale, DOM ~32)
Contra Costa — Entry SFRs <$800K–$1.3M (101–103% list-to-sale, DOM ~27–31)
🟥 Red (Buyer-Leverage) Zones – September 2025
(All three metrics aligned: Price/SqFt ↓, DOM ↑, Pending ↓)
San Mateo — Condos $1.3M+ (PPSF down, DOM ~56+, list-to-sale <100%)
Alameda — Condos $800K+ (DOM 40–55, sale-to-list flat/weak)
Santa Clara — Condos $1.3M+ (DOM 45–60, soft pricing, 99% list)
San Francisco — Condos all tiers (DOM ~69, PPSF flat/down, sale-to-list ~100%)
Contra Costa — SFR $2.3M+ (DOM ~30–40, 95–98% list)
👉 Shift from July:
More Green zones shifted into core family SFR price bands ($1.3M–$2.8M across counties).
Red zones expanded in condos, especially high-end and urban.
Luxury SFRs ($3.8M+) mostly lost momentum → no longer green, many sliding into neutral or red.
Macroeconomics
Mortgage Rates
August 2025: Average 30-year fixed (Freddie Mac PMMS) was about 6.63%.
September 2025: Average 30-year fixed dropped to roughly 6.27%.
So month over month, rates fell ~0.36 percentage points, moving from high-6s to the low-to-mid 6% range, which is what helped unlock that late-September bump in buyer activity.
10-Year Treasury
September average: ~4.12% (a continued drop from 4.32% in August and 4.39% in July).
Fed rate-cut expectations pulled yields down — markets priced in the September 25 bps cut and anticipated more easing, reducing long-term rate pressure.
Fiscal pressures kept yields from falling further — high government debt, heavy Treasury issuance, and elevated term-premium all limited how low yields could go.
Cooling inflation + softer economic data supported a lower yield, but not enough to break the 4.1%–4.3% range investors stayed anchored to.
Stock Market
NASDAQ (Tech-Heavy Index)
September 2025: +5.4% — strong rebound driven by AI, chipmakers, and rate-cut optimism after the Fed’s 25 bps cut mid-month.August 2025: +2.1% — continued gains but slower momentum heading into September.YoY (Sept ’24 → Sept ’25): +28% — still the top-performing major index, powered by AI infrastructure, cloud adoption, and renewed risk appetite.
Big September headlines: Fed rate cut, stronger-than-expected AI earnings, and a rotation back into growth/tech.
S&P 500
September 2025: +3.5% — broad rally as easing inflation and lower yields boosted demand for equities across sectors.August 2025: +1.6% — steady gains with new early-month highs.YoY: +19% — diversified strength led by tech, healthcare, and consumer discretionary.
Big September headlines: Cooling CPI, 10-year yield slipping to ~4.12%, and the Fed signaling a cautious easing path.
Dow Jones Industrial Average
September 2025: +1.9% — improved performance as rate cuts supported industrials and financials, though still trailing tech-heavy indexes.August 2025: +0.5% — modest gains with continued sector lag.YoY: +9% — solid but overshadowed by the explosive growth in tech.
Big September headlines: Lower borrowing costs from the Fed cut, easing inflation pressures, and stabilization in manufacturing sentiment.
Bay Area Tech Impact
The sharp September rebound in the Nasdaq (+5.4%) and S&P 500 (+3.5%) boosted stock-option values, ESPPs, and RSU portfolios for Bay Area tech workers.
With AI, chipmakers, and cloud firms leading the rally, mid- to senior-level employees saw meaningful increases in net worth, improving both homebuying capacity and consumer confidence.
Luxury markets saw limited benefit, as most gains favored mid-level individual contributors and senior managers rather than C-suite liquidity events.
FED (Federal Reserve)
The Fed cut rates by 25 bps on September 17, 2025, marking the start of a cautious easing cycle as economic data softened.
The cut pushed mortgage rates into the low-to-mid 6% range, giving Bay Area buyers a small but meaningful boost in affordability.
This increased confidence and activity in the $1.3M–$3.3M single-family market, while luxury buyers (> $3.8M) still held negotiation power due to slower demand.
What Could Drive Additional Fed Cuts After September 2025?
📉 Cooling Inflation: CPI continued easing into September; further progress toward 2% would justify more cuts.
👷 Softening Labor Market: Slower hiring and rising unemployment increase pressure on the Fed to support growth.
💵 Sluggish Consumer Spending: Signs of weakened household demand could push the Fed toward additional easing.
📊 Slower Economic Growth: Any drop in GDP momentum would reinforce the case for rate cuts.
🏦 Market Stability Risks: Sharp market pullbacks or tightening credit conditions could accelerate the Fed’s timeline.
For Buyers: Continued cooling in inflation and jobs could mean cheaper mortgages and more affordability.
For Sellers: More cuts can boost buyer demand, but economic uncertainty may keep buyers cautious at higher price tiers.
Inflation
Headline CPI (Sept YoY): ~3.00% — up slightly from ~2.90% in August.
Core CPI (excludes food & energy): ~3.03% YoY — down modestly from ~3.11% in August.
Month-over-month (Sept): Headline CPI ↑ ~0.30%, Core CPI ↑ ~0.20%
Key driver: Shelter inflation slowed (owners’ equivalent rent +0.13% vs prior ~0.30%) but remains a large share of the basket.
Takeaway: Inflation is stabilizing around the 3% mark. While the slowdown is welcome, core inflation remains elevated — meaning the Federal Reserve is likely to stay cautious, which keeps mortgage-rate pressure intact for now.
Employment
Unemployment held around 4.3% in September, signaling a cooling labor market.
Early payroll estimates showed a drop of ~32,000 jobs, the weakest reading in over two years.
Slower hiring reduced wage pressure and increased expectations for continued Fed easing.
What to Watch For
Jobs Report: Another weak month of payrolls or rising unemployment would increase odds of more Fed cuts — supportive for buyers, but a potential confidence drag if recession fears grow.
Working in the SF Bay Area
Remote Work & RTO Mandates
Google: Tightened enforcement of its 3-day RTO policy, with managers required to document non-compliance.
Meta: Increased expectations for some AI and product teams to be in the office 3 days minimum, 4 preferred.
Salesforce: Expanded “Flex Team Agreements,” allowing some groups to drop to 1–2 in-office days while others moved to 3–4.
Apple: Began enforcing fixed anchor days (Tue–Thu) across more teams, tightening its existing 3-day RTO policy.
Uber: Shifted many engineering and product teams from 2→3 in-office days through team-level mandates.
OpenAI: Encouraged more in-person collaboration for model-training and infra teams, trending toward 3+ days/week.
Pinterest: Expanded its “Work From Anywhere up to 90 days/year” benefit, increasing remote flexibility.
Splunk: After Cisco integration, moved most teams from 2→3 required days in the office.
Net effect: Most tech and professional workers are splitting time: a few days in SF / Peninsula offices, the rest at home or in co-working.
Regional Transit Trends
BART carried over 5 million trips, about 10% higher than a year earlier, with Saturday ridership nearly 20% higher than the prior September.
Agencies are explicitly reprogramming service around remote work—less focused on 9–5 commuters and more on nights/weekends because hybrid schedules mean fewer classic rush-hour trips.
A Bay Area Council survey earlier in 2025 showed only 46% of workers use transit “at least some of the time”, even as return-to-office rises; car traffic (Bay Bridge, freeways) is basically fully back.
Translation for you:
Transit is improving, but a lot of hybrid workers are driving, not riding. That keeps some downtowns softer during the week but doesn’t kill demand for Peninsula / close-in suburban homes.
Office Space & leasing dynamics
SF office is finally posting consistent positive absorption. Q3 2025 closed with vacancy around 33–34%, down 20–90 bps from a year earlier, and positive net absorption (~300k sq ft+) for only the second time since 2019. Cushman & Wakefield
Sublease vacancy keeps shrinking for the fifth straight quarter, driven by tech and AI startups grabbing discounted, high-quality space on shorter terms. Cushman & Wakefield
Most deals are small HQ / hub leases: ~75% of Q3 SF leases were under 10,000 sq ft, a classic hybrid pattern (smaller, higher-quality collaboration hubs, not giant cube farms). Colliers
So:
Hybrid work = “less space per person but better space” → AI and growth companies still want A-grade space in SF / Peninsula, just not 5-days-a-week footprints.
For housing, this supports demand in core commute sheds (Peninsula, close-in East Bay), but not a full “everyone back downtown” reversal.
Startups and Venture Capital
US VC in September 2025: $30.91B across 533 companies — up 281.6% MoM and 312% YoY, dominated by Anthropic’s $13B Series F in the Bay Area. AlleyWatch
The Bay Area still eats ~51% of all U.S. AI startup funding, far ahead of every other region. GeekWire
Scaleup data shows 93% of 2025 scaleup VC dollars in Silicon Valley are going into AI—VC in “tech” basically means AI now. Crunchbase News
Specific SF AI rounds in September (e.g., Exa’s $85M Series B, FriendliAI’s $20M seed) underline that AI infra and devtools are hiring and leasing locally. Crescendo.ai
Impact on real estate:
More high-paid hybrid workers with RSUs → continued demand for $1.3M–$3.3M SFRs in Peninsula / South Bay school districts.
AI firms expanding offices in SF / Peninsula → slow but real support for Class A office markets, especially Mission Bay, SoMa, Sunnyvale, Mountain View.
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