| LIFE IN SOLERA | DECEMBER 2025 | 7
REAL ESTATE REPORT
By Glenn Bradd, Broker Associate, Solera Realty Team, Solera Resident
More Californians can purchase a home in third-quarter 2025,
compared to the previous quarter and last year, C.A.R. reports.
Seventeen percent of California households could afford to
purchase the $887,380 median-priced home in the third quarter of
2025, up from 15 percent in second-quarter 2025 and up from 16%
in third-quarter 2024.
A minimum annual income of $223,600 was needed to make
monthly payments of $5,590, including principal, interest, taxes
and insurance on a 30-year fixed-rate mortgage at a 6.67 percent
interest rate.
Cooling market competition and an increase in available housing
helped moderate home prices and allowed more Californians to
buy homes in the third quarter of 2025. Housing affordability
in California stayed near its all-time low and continued to be a
challenge for both buyers and sellers.
The effective mortgage interest rate declined for the second
consecutive quarter, nearly reversing the growth experienced over
the last year. This is the lowest level in a year, after the Federal
Reserve's rate cut of 25 basis points to 3.75 percent from 4.00
percent. While borrowing costs may remain lower in the short
term interest rates could f luctuate in the months ahead.
The statewide median price of existing single-family homes in
California fell 2.0 percent in the third quarter of 2025 compared to
the previous quarter, ref lecting a cooling in market competition.
With the market transitioning into the off-season, home prices are
expected to moderate further as seasonal factors kick in. However,
if lower mortgage rates materialize in the months ahead and
economic uncertainties subside, housing affordability could see
some slight improvement in the next couple of quarters.
Source: www.car.org 11/06/2025
