The median home price in California surpassed $900,000 for the first time in April, reaching a new record of $904,210, according to recent data from the California Association of Realtors. This represents an 11.4% increase from April 2023. Despite concerns about the economy and mortgage rates, which remain around 7% (though down slightly from a peak of nearly 8% in October 2023), home prices have continued to rise.
The state’s housing inventory remains tight as the market enters its busy season. Prices have increased nearly 6% since March 2024, with sales of homes priced above $1 million rising by nearly 40% compared to April 2023. This surge has contributed significantly to the higher median home price. Areas previously considered “affordable” are now more expensive, according to Jordan G. Levine, chief economist at the California Association of Realtors.
Despite predictions of a decline in the San Francisco Bay Area housing market, this region experienced the highest price increase, with a 15.5% rise since April 2023. All other regions, except for the Far North, also saw price increases. The Far North region experienced a 5.2% decrease in home prices.
Notable price increases have occurred in less expected areas as well. Tustin in Orange County saw an 11.7% rise in home prices, reaching a median of $1 million. Coachella, known for its music festival but located in a different part of the valley, also saw an 11.5% increase in home prices.
Home affordability in California is at its lowest level in 16 years. A 2023 report from the California Association of Realtors indicated that an annual income of $222,800 is needed to afford a median-priced home, with only 15% of home buyers able to purchase at this level.
“There’s a significant divide where higher-income buyers are still active in the market, while those at the lower end of the income spectrum find themselves with few affordable options,” Levine noted.
