California’s home sales declined by the largest amount in a year in May, as an extended buying slump continues.
My trusty spreadsheet reviewed statewide transaction data from Attom, finding 28,557 closed sales of houses and condos, both existing properties and new construction. That’s a 7% decrease over the past year.
Homebuying has stalled as prices and mortgage rates remain elevated, and economic uncertainty persists.
How lethargic is this market? Sales are 29% below the 40,261 average for May since 2005. This May was the second-slowest such month in 21 years.
Consider a slightly longer-term view to appreciate this long-standing stagnation.
There were 324,326 residences sold in the 12 months ending in May 2025. That’s 26% below the average pace over the past two decades.
No. 1 price
Those who are buying are paying up.
The state’s median selling price of $750,000 for May ties the peak set in June 2024.
But pricing is under pressure. Appreciation averaged 7% a year during the last six years. However, the median is up only 0.1% in the past year.
May was the worst 12-month performance for home prices in the past 24 months.
Payment pain
Most of California’s house hunters have balked at the lofty prices and pricey mortgages.
Borrowers secured an average 30-year rate of 6.8% in the three months ending in May, compared with 7.1% in May 2024.
However, rates remain above the 4.1% rates of six years ago, before the pandemic altered the real estate market, or the average 4.8% since 2005. And don’t forget the rate troughs of the past two decades: 2.7% in January 2021 and 3.4% in December 2012.
So, a typical May buyer for California’s median-priced home has an estimated house payment of $4,856 – the ninth-highest on record – assuming a 20% down payment at the average mortgage rate.
Yes, the house payment is off 2% over 12 months. Yet this buyer’s burden is 100% higher in six years.
And another expense trips up wannabe owners: the down payment. In this example, it’s $150,000.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com