flattening prices

The market is a slow burn & checking the declining box

July 30, 2025 By Ryan Lundquist 8 Comments

This market has been a slow burn. What I mean is we’re starting to see softer prices, but it hasn’t been really quick change like some sensational housing headlines might suggest. Let’s get into it. Skim by topic or digest slowly.

UPCOMING SPEAKING GIGS:

7/31/25 Big market update & panel at PCAR
8/6/25 Realtor Event TBA
9/10/25 Windermere Sacramento
9/16/25 Culbertson & Gray (private)
9/24/25 Keller Williams Roseville
9/26/25 PCAR
9/30/25 Elk Grove Regional MLS Meeting
10/15/25 EDH Coldwell Banker (private)
10/21/25 Orangevale MLS Meeting
10/23/25 CREB Meeting (TBA)
11/4/25 SAR Main Meeting
12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)

UPDATE:

I wanted to clarify something. When I say the market is a slow burn, I’m referring to the overall trend. There are obviously parts of the market that are doing different things than others. For instance, condos have a much colder temperature. In coming weeks, I plan to do a Q&A about newer construction also (which has had bigger declines in some instances).

ARE PRICES FLAT OR DECLINING?

What’s happening to prices? Well, the truth is it’s not always easy to tell when pulling comps or making graphs, but some neighborhoods are flat while others are in declining territory. As an appraiser, I find myself checking the “declining” box in appraisal reports lately to describe what prices are doing (but not always). Here’s an example with Oak Park (excluding North Oak Park), and can you see how the blue dots are starting to point lower over time?

NOTE: I’ll share updated regional and county images soon to show the price trend, but today I only have scatter graphs. If you hate those graphs, then you might hate this post.

MORE OBVIOUS DECLINES IN CONDOS

I’m finding a more obvious decline in some condo / townhouse subdivisions. This doesn’t mean every single condo project is having a hard time, so let’s be careful about generalizations. But when I make scatter graphs like this, it’s been easier to spot a declining trend with these units. Many condos have been struggling with higher HOA fees due to insurance issues, and I wonder if buyers have stepped back more from attached living with tiny yards (there could be a preference issue). There is a new balcony law in California as of 2025 (SB 326), but I don’t think that’s the culprit in slowing the condo market because the trend started before this year. Don’t get me wrong. SB 326 could be a big issue in older condo developments with deferred maintenance (and balconies).

Condos have had a higher level of cancellations this year compared to detached units too. Detached units are still below 2019 levels.

DISCONNECT BETWEEN ONLINE AND THE MARKET

There is a disconnect right now between the crash bro housing narrative about plummeting prices and the actual market that is down slightly. Of course, market speed could change, and there is nothing wrong with that or declining prices, but to date it’s been a slow burn instead of fast change (more on that below).

FLIRTING WITH FLAT AND DECLINING

Like I said above, it seems hit and miss by the neighborhood, and it’s not always easy to tell what’s happening to prices in the moment when pulling comps. Look, everyone will be an expert with the benefit of hindsight, but when you’re in the midst of a trend, it takes skill and time to understand and articulate what is happening. Ultimately, some areas look really flat and others are experiencing more obvious downward price pressure. Keep in mind these types of graphs reflect sales, so any trend happening right now really won’t show up instantly in the data. So, this isn’t the perfect way to see the market (there isn’t a perfect way).

IT’S BEEN A SLOW BURN

No matter what, it’s been a slow burn today. We haven’t seen really quick price change like we did in 2007 when the market declined VERY fast in a short period of time. Back then we had almost 200% more active listings locally, so it was very easy to get quick results. That hasn’t been the vibe today. I’m not sugarcoating the market. I’m just saying we need to be realistic about the difference and not expect 2007 results with 2025 stats. Moreover, one thing we’ve seen lately is sellers have backed off over the past couple of months, so we haven’t seen as many new listings, which means supply hasn’t grown as much. This is important because the number of sellers (and buyers) can affect the way the market feels and what prices do.

CLOSING TIPS FOR TODAY

Beyond making graphs, I think so much of today involves comparing and contrasting sales and listings. Is there a price difference between sales and what is happening in the listings and pendings? Sometimes downward price pressure doesn’t show up right away in scatter graphs like the ones above, but we notice it first when pendings start to get into contract at lower levels. Remember to look for a pattern of pendings instead of just one example. We don’t want to pin our entire perception of the market on one property, right? Also, we might have to look at adjacent neighborhoods since there aren’t that many sales happening right now. County and regional trends have been flirting with flat to down slightly from one year ago, but that’s not always going to rigidly show up in every single price range and location. Yet, flat to down slightly from one year ago is how the market feels in many areas too. As an appraiser, when saying the market is declining and making downward adjustments, my adjustments have been pretty modest so far since change hasn’t been exponential.

Let’s keep watching what happens with seller behavior, buyer behavior, consumer sentiment about real estate, and mortgage rates. It all matters.

Thanks for being here.

LEAVING COMMENTS: The captcha is not working perfectly. If you open up a new browser, that should solve the issue. It’s been a problem to comment when clicking from my weekly email. My apologies.

Questions: What are you seeing with comps right now? Are prices up, down, or sideways? I’d love to hear your take.

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The problem with comps in today’s housing market

July 24, 2025 By Ryan Lundquist 8 Comments

We have a problem with comps in today’s real estate market. Well, technically the comps aren’t the issue. We’re just not always looking at them in the right way. Let’s talk about that today. Also, I have some fresh stats to help show how much prices have gone up through the years. Skim by topic or digest slowly.

UPCOMING SPEAKING GIGS:

7/25/25 Prime Real Estate (private)
7/31/25 Big market update & panel at PCAR
8/6/25 Realtor Event TBA
9/10/25 Windermere Sacramento
9/16/25 Culbertson & Gray (private)
9/24/25 Keller Williams Roseville
9/26/25 PCAR
9/30/25 Elk Grove Regional MLS Meeting
10/15/25 EDH Coldwell Banker (private)
10/21/25 Orangevale MLS Meeting
10/23/25 CREB Meeting (TBA)
11/4/25 SAR Main Meeting
12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)

THE PROBLEM WITH COMPS TODAY

If three homes in a neighborhood closed last month, do they tell us about the market right now? It’s tempting to say yes because the sales are so recent, but these properties tell us more about what the market used to be like a few months ago when they got into contract. If the market has changed, these sales are more like historic artifacts that show us what prices used to be like. What is the market like right now? We have to look at what’s happening with pendings and listings to get a pulse on that. In other words, what’s getting into contract today? That’s the biggest clue into what buyers are willing to pay at the moment. We still give strong weight to actual sales, but if the market has gone down in value, we need to give stronger weight to what we’re seeing in the listings and pendings. It’s sort of like stock prices. I’m going to want to look at what a stock was worth a few months ago, but what is it worth today? That’s the question I ask when buying. And in real estate, today’s prices are seen in the pendings and listings.

QUICK TIPS ABOUT PULLING COMPS

1) FOCUS ON THE CONTRACT DATE: Definitely give weight to sales because they actually closed, but ask yourself how much the market has changed since those properties got into contract. Remember, the price was basically established at the contract date (and some negotiation while in contract), so we’re going to focus on the contract date more than the closed date when trying to figure out how different the market is from the time the price was established. In a softening market, if you use a sale from the spring, don’t be afraid to give a negative adjustment to the property to bring it down to what buyers are willing to pay today.

2) LOOK FOR A PATTERN: Don’t hang your perception of value on just one property. We want to look for a group of sales, pendings, and listings. In other words, we don’t want to view one lower pending and base our entire perception of value on that property. That’s not enough data to show a trend. What if that one pending was priced low to generate interest? Or what if it smelled like 20 cats? This is why we want to look for a pattern instead of just one example. It would be like me going to the mall and seeing a teenager sporting a sweet mullet. Does that mean mullets are back in style? Or is it an isolated incident? Seeing one bro with “business in front and a party in the back” isn’t enough to say it’s a trend.

3) GO OLDER & WIDER: There aren’t many sales today, so we may have to look at what’s going on in competitive neighborhoods to wrap our minds around value. We might also have to look at much older sales in the immediate neighborhood to understand how prices have moved. I wrote more about the challenge of comps in 2025, and we simply need to spend more time digging through older stuff, newer stuff, and competitive areas. If you’re only spending five minutes and it’s working, then it’s time to sell an eBook and get rich. For the rest of us, we’re going to be in the comp trenches for significantly longer.

THIS ISN’T ANYTHING NEW

The truth is we always see the current market in the listings and pendings, so it’s not like this is a new phenomenon at all. I think it just feels like it’s a new thing when prices are softening. For some sellers though, this actually is new because they aren’t used to thinking about value like this. Moreover, it’s really hard to price below a neighbor who is being totally unrealistic.

HOW MUCH HAVE PRICES RISEN?

With so much talk about prices starting to soften, let’s pause and ask how much prices have gone up. Here’s a look at median price change. Of course, median change doesn’t always perfectly represent actual value change, but it’s at least something to get conversation started.

For sellers, what do you want to do with your equity? Where do you want to be in life? Who do you want to do life with? What possibilities exist for you ahead?

NOT EVERY AREA IS EXACTLY THE SAME

Here’s a sample of some different areas. This is a good reminder that not every location has the same exact trend. So, when we say prices are down modestly today, that may or may not apply exactly the same to every area and price range. Also, percentages can sound crazy if the first number is really low, so be sure to look at the dollar amount too (Oak Park).

NOTE: Some neighborhood and price ranges could have different growth than what we see for an entire city. I saw this recently with a property in Folsom. An owner bought about ten years ago, and this higher-end neighborhood rose by $400,000+ even though the county trend was maybe half of that.

IMPORTANT REMINDERS ABOUT PRICE STATS

1) NOT PERFECT: Median price change doesn’t apply perfectly to every single house and neighborhood. So, a $160,000 change in Sacramento County since 2020 doesn’t automatically mean we’re going to see exactly this amount in the comps. Maybe it’s higher. Maybe it’s lower. In fact, my observation is the high-end grew significantly more than the median price in the county, so if you’re expecting to see county trends play out at the high end, you might actually undervalue a property.

2) DON’T BE RIGID: It’s key to look to the comps in each neighborhood. In other words, don’t be rigid about imposing median price change on an area without looking up actual comps. The same holds true today when we see the median sales price in Sacramento County is down almost 2% from one year ago. Does that apply equally to every location and price range? Probably not. Look to the comps to know for sure. The truth is market change doesn’t hit every area exactly the same even though all ships tend to rise and fall with the tide.

3) DON’T BE A HATER: Sometimes people are negative about the median sales price, and I sort of get it because it’s not a perfect metric (there is no perfect metric or price index). The problem is if we start to see more sales at the top of the market, that can make the median sales price increase. So, maybe the market didn’t really go up in value. It could just be more at the top and less at the bottom. Here’s an example of that happening.

But here’s the thing. Sometimes people hate on the median, but they don’t offer an alternative, which seems really unhelpful. What should we look at for the local market instead? Are you telling me the national Case-Shiller Index? Does that apply to Sacramento or wherever? I don’t like that idea. I do like looking at Zillow’s price index for Sacramento and other indexes focused on metro areas. Interestingly enough, Zillow’s price index in June is currently showing the same exact trend as the median sales price in Sacramento County.

My advice? Look to traditional metrics like the median or average, and check out some price indexes too. Keep in mind a price index has the same problem though. Does it mean every single property and price range is down by 2%? Nope. Ultimately, we have to look to the comps instead of rigidly apply the median (or a price index) onto every single property.

On that note, here’s my favorite image from ResiClub that shows
Zillow’s price index for various metros. If you’re aren’t following Lance Lambert of ResiClub, you are missing out. If you are in one of these locations, do you think Zillow’s index represents the trend? It does for Sacramento, but I’m curious to hear if it’s spot on for other places.

Thanks for being here.

Questions: What are you seeing with comps right now? Are prices up, down, or sideways? What point stands out to you the most? I’d love to hear your take.

If you liked this post, subscribe by email (or RSS). Thanks for being here.

Buyers are turned off by the market and busy streets

July 16, 2025 By Ryan Lundquist 8 Comments

Buyers are turned off right now. This is true about the market as the number of pendings has plummeted since April, but it’s also true about busy locations. Today, I have some fresh perspective and stats. I hope this is helpful.

UPCOMING SPEAKING GIGS:

7/16/25 Comps & Adjustments (3 hours)
7/17/25 Jamie Pierroz Event (private)
7/22/25 Investor Event (register here)
7/25/25 Prime Real Estate (private)
7/31/25 Thomas Harris Event (TBA)
8/6/25 Realtor Event TBD
9/10/25 Windermere Sacramento
9/16/25 Culbertson & Gray (private)
9/24/25 Keller Williams Roseville
9/26/25 PCAR
9/30/25 Elk Grove Regional MLS Meeting
10/15/25 EDH Coldwell Banker (private)
10/21/25 Orangevale MLS Meeting
11/4/25 SAR Main Meeting

BUYERS ARE TURNED OFF ABOUT BUSY STREETS

It’s not like buyers were ignoring busy locations in the past, but today any perceived adverse location is standing out like a sore thumb. When the market was ultra-competitive in 2021, buyers were prone to be more forgiving of a busy street since there weren’t as many options, but that’s not the vibe today since supply has been growing more than demand. Do you agree? What are you seeing out there?

I talked to an owner this week about a listing that is not selling, and it turns out he’s on a busy street. After chatting for a good chunk of time, I asked if it was possible that the busy location was underestimated in developing the list price, and the owner said that was likely the case. The good news is after a couple of price reductions, the property is at least getting showings (which tells us value is likely close).

My advice? Recognize how picky buyers are about location, condition, and price in today’s market. And don’t underestimate how much location can truly matter to buyers today. When it comes to comps, be sure you’re finding other homes with similar location issues. Don’t simply say, “Well, I’m just going to subtract $5,000 or $10,000 because that’s what I’ve always done.” Why not dig into the comps to help understand the impact of a busy location? Find properties in the immediate neighborhood or competitive areas that sold with an adverse location, and try to unpack how much the location impacted the price. When we do this, we might find instead of adjusting down $5,000 or $10,000, maybe it’s 5% or 10% (there isn’t a one-size-fits-all answer here, so we have to look to the comps).

WORST SALES VOLUME EVER FOR JUNE

The pool of buyers has been shrinking lately, and that’s huge for sellers to recognize. In fact, sales volume in June in the Sacramento region was the worst we’ve seen since MLS went digital in 1998. And this is especially bad since we’ve had population growth through these decades. I guess the positive news is that volume is only barely lower than one year ago, so at least it wasn’t dramatically different. By the way, in coming months, I suspect 2025 will do better than 2007 numbers since 2007 got absolutely crushed during the second half of the year.

Placer had the second worst June next to 2007, so it wasn’t technically the lowest June ever. So, congrats?

BEST MINDSET EVER

While talking about the worst volume ever, I want to mention the importance of cultivating the right mindset. For anyone who works in real estate, it’s all about keeping your head down, running toward the challenge of this market, having optimism for life and business, and connecting with people who have incentive to participate in today’s housing market. Remember, if we’re missing 30% of the normal number of buyers, that means 70% of buyers are present. How can you connect with the 70%? That’s what matters.

MORE BUYERS ON THE HORIZON?

Since April, we’ve seen buyers step back in light of more uncertainty. Check out the blue line below. But in the background mortgage applications for purchases have been increasing, so eventually we’ll see more buyers. For now, there’s a clear disconnect between more applications and actual sales happening though, so don’t get too hyped.

SELLERS ARE ALSO PUMPING THE BRAKES

Sellers have pumped the brakes too, which reminds us that uncertainty is also a big deal for sellers. I mentioned this when May looked to be down, and that trend continued through June. All everyone is talking about is exploding housing supply, but let’s watch seller behavior closely. Yes, the pile of active listings has increased quickly, but if sellers back off some, that could change how much the pile grows, right? Check out my skateboard wheels analogy if you want a helpful way to think about how supply can change.

If you want to see new listings and pendings in your area, check out Redfin’s weekly stats here.

Thanks for being here.

Questions: What are you seeing with buyers and location right now? Any thoughts about low volume? What point stands out to you the most? I’d love to hear your take.

If you liked this post, subscribe by email (or RSS). Thanks for being here.

Confusing housing stats & real estate nerds

July 9, 2025 By Ryan Lundquist 6 Comments

The housing market is up. No, it’s down. Wait, it’s stable. There are some confusing stats right now, and it’s more important than ever to nerd out on the trends so we don’t misinterpret what’s happening. I hope this is helpful no matter where you are in the country. Skim quickly or digest slowly.

UPCOMING SPEAKING GIGS:

HOUSING NERDS, IT’S YOUR TIME TO SHINE

It’s time to really pay attention to the market. Be a nerd. Know the numbers. Be able to explain the trend. Avoid sensationalism. Cultivate objectivity. Be intentional about thinking through the market and figuring out how to describe it. And don’t get caught making some of the mistakes below.

TEN THINGS TO KNOW ABOUT TODAY’S MARKET:

1) Price stats can bounce around:

Don’t expect price stats to do just one thing from here on out. The market has been softening, but that doesn’t mean prices will show a decline every single month.

2) Don’t build your narrative on just one month of data:

Some people are going to sound manic. One month they’ll say prices are down, but then prices are stable or up the next month. My advice? Don’t be rigid about price stats because they can bounce up and down, and don’t build your narrative on only one month of data. We need time to see the trend. On that note, a trend doesn’t always show up neatly in the numbers.

3) Be able to explain why prices can be up when the market feels down:

This is such an important example, and it could happen anywhere in the country. Some people are going to misinterpret the housing market because of stuff like this.

The median price was negative in May in Placer County, but in June it’s up 3%. How can that be possible? Did the market rebound? Well, what’s selling makes a difference in the numbers, especially in areas where there aren’t that many sales.

In June 2024, there were more sales at lower prices (see orange bars). Or another way to say it is there were more sales at higher prices this year, which made the median sales price jump up in 2025. In other words, having a greater percentage of sales at higher prices today caused the median price to shift higher. It’s not that prices went up by 3% across the board because that doesn’t really fit how the market feels, right? This is what housing nerds call mix shift, and it matters for the stats.

4) The trend doesn’t always show up right away:

It takes time for a trend to show up in the closed sales, so there is a sense where stats lag the trend. In the example above, Placer County prices look like they’ve rebounded, but in the background, we’re seeing supply grow quickly. Well, this growth will show up in the stats eventually. This is where it might be important to give more weight to larger areas with more data instead of smaller areas where stats can bounce around a bit more.

5) Be careful about imposing narratives (we haven’t seen a big price crash):

Many people are talking like a big crash has happened, but that’s not the case. We’ve seen prices dip, but today’s market is nothing like 2008 with sharp price declines. Locally, the number of active listings was 190% higher in 2008 than it is right now. I’m not sugarcoating. Let’s just not flippantly say it’s 2008 when that’s not what the stats show right now. And let’s be careful about expecting 2008 results without 2008 dynamics. All I’m saying is let’s be real about the market in front of us.

6) The comparison today is a bit awkward:

The spring market peaked early this year, so we’re now comparing today with a spring last year that went on further. This makes the contrast a bit awkward today, and it’s just something we should keep in mind as we interpret the numbers.

7) The temperature could change:

The housing market temperature doesn’t stay the same, and we want to continue to watch what happens with mortgage rates, consumer sentiment, buyer and seller activity, and uncertainty. Here’s an analogy I shared yesterday. Sorry not sorry.

8) Not every part of the market is the same:

Some parts of the market could feel different than others. I’ve been talking about condos having a moment due to insurance headwinds and other issues, but new construction has really taken a beating this year too. Besides 2022, it was the worst June since 2016 for new homes. On a related note, it’s key to remember that not every condo complex or brand-new home is going to have the same trend. This is where we need to be cautious about painting every property with just one brush.

9) All ships rise and fall with the tide:

I was talking with a friend about strength at higher prices, and he mentioned how some higher-end listings are just sitting. Solid point. This is a good reminder that the softness we’re seeing is hitting every price range. Even though we can say the higher end is showing stronger volume, it’s still NOT immune from the softer trend happening in the wider market. In other words, all ships rise and fall with the tide.

10) The housing market is still very broken:

We’ve seen a big increase in the number of active listings lately, but it’s astounding that the pile is only this high after three years of such a struggle with affordability. Thankfully, sellers have been thawing out lately, but locally and nationally we’re not even back to the pre-2020 norm for the number of new or active listings. The reality is having a lower number of sellers listing their homes for a few years has helped keep prices higher, which reminds us the market is broken. Ultimately, we’re still dealing with the consequences of 3% rates, and it’s going to take years to work this out.

LOCAL STATS FOR LOCAL NERDS

For anyone interested, here are some fresh price stats. Some counties are up while others are down. A good way to describe the price trend is we’re flirting with last year’s numbers, and there is growing downward price pressure.

YEAR-OVER-YEAR PRICE STATS

MONTH-TO-MONTH STATS

I’ve lumped some data into 60-day chunks in smaller counties to help tell the story of the market. Stats can bounce around way too much if we’re only looking at 30 days. Do you think it works?

Thanks for being here.

Questions: What are you seeing right now with prices? What point stands out to you the most? I’d love to hear your take.

If you liked this post, subscribe by email (or RSS). Thanks for being here.

flattening prices

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