Real Estate Market Slowdown
The local real estate market for single-family homes started the year off strong, hitting all-time highs in March 2025 . However, in early April when the tariff wars began, both the stock market and the real estate market cooled almost immediately. While the stock market has since rebounded, home prices have continued to decline. By July 2025, home sale prices had dropped by approximately 8% from their March highs.
In July, the average single-family home in Santa Clara County and San Mateo County combined sold for $1,183 per square foot of living space, or $2,374,070 total. That means, on average, $2.4 million buys you a 2,000-square-foot home.
Currently, the housing supply is exceeding demand. July 2025 ended with approximately 1,905 homes actively for sale, while only 1,046 sellers accepted offers during the entire month. This sales-to-active inventory ratio is similar to what we saw in June 2022, when interest rates spiked and home sales slowed dramatically.
The slowdown is also reflected in the average days on market. While homes that closed escrow in July sold on average in 24 days, those that were pending at the end of July (reflecting the most recent sales) had been on the market for an average of 31 days. That’s a relatively high number for this time of year.
Interest Rates Remain Unchanged
Meantime, interest rates remain unchanged. On July 30th the Federal Reserve left its key interest rate unchanged. The Fed said that economic growth had moderated in the first half of the year but that inflation remained “somewhat elevated.” CNBC reported that uncertainty about the economy worries people more than the high interest rates, and this is what’s keeping some from making big financial decisions. The average interest rate for 30-year fixed-rate mortgages with conforming loan balances (of $806,500 or less) is currently about 6.72%.
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