The recent steep drop in home appreciation – in California and across the nation – came as the number of homes on the market jumped in most states.
Many real estate gurus see swings in listings as a key predictor of price moves. By that logic, last year’s added supply meant buyers didn’t have to be very aggressive in their bidding.
To see if that thesis adds up, my trusty spreadsheet compared price indexes from the Federal Housing Finance Agency with listings data from Realtor.com, tracking 2025’s changes relative to the previous six years across the 50 states and the nation.
First, contemplate the stiff appreciation chill.
California’s gains in home prices shrank 73% – that’s a 1.9% increase last year vs. averaging 7.2% increases throughout 2019 to 2024. That was the sixth-biggest decrease among the states.
U.S. price gains ran 3.9% in 2025 vs. an average 9.3% annually during 2019-24. That’s a 58% slowdown.
This cooling was widespread as only North Dakota had a 2025 price increase exceeding its 2019-24 average appreciation pace.
For sale surge
Next, ponder a widespread surge in listings.
Nationally, there were 33% more homes for sale last year than what was typically on the market in 2019-24.
California house hunters were among 39 states with more listings to choose from – up 36% vs. 2019-24 – the 18th-largest increase.
Think about the linkage between prices and listings when the states are ranked by their appreciation chill.
The 17 states with the steepest shrinkage in gains saw declines average 70% to 2.8% in 2025, down from 9.3% annually in 2019-24. In those states, the combined number of homes for sale grew by 58%.
Contrast those patterns with the 17 states with the smallest dip in appreciation: an average 27% drop with 5.6% increases last year, down from 7.7% in 2019-24. Listings collectively fell by only 7%.
More options, weaker pricing.
A housing however
To my eyes, there’s a “but” in here.
Consider the state results when they’re reranked by the change in listings, 2025 vs. the previous six years.
Intriguing questions emerge when job creation becomes part of the equation. You need a reliable paycheck to have the nerve to buy.
In the 17 states with the biggest rush to sell – a combined 61% more listings – job growth ran 63% below average last year.
Then peek at the 17 states at the opposite end of the listing-change spectrum. They had only 12% more homes on the market while job creation slowed by just 16%.
Did wobbly job markets nudge some homeowners to put their homes on the market, and/or were increased job security fears making house hunters thriftier with what they’d pay?
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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