Marin County Real Estate Market Report October 2025

From the Golden Gate Sotheby’s Bay Area Market Report…

OVERALL HOUSING MARKET INDICATORS REMAIN SOLID

The housing market in the SF Bay Area remained strong in the third quarter, with most indicators on par with the previous year. SF Bay Area payrolls continued to stabilize in early autumn, and other measures of economic activity were positive though the length of the government shutdown as well as upward pressure on inflation from tariffs remain concerns. More than $100 billion in venture capital was deployed in the SF Bay Area in 2025, greater than any year on record. The average annual salary in the SF Bay Area also surpassed the $100,000 mark for the first time. The labor market remained moderately tight as the number of employed increased and the unemployment rate decreased to less than 5%. Stronger housing demand was somewhat offset by persistently high mortgage rates, which kept some affordability-constrained buyers sidelined. However, the potential for lower interest rates in the near term may reduce this hurdle.

INVENTORY STILL BELOW TYPICAL LEVELS BUT IMPROVING

The inventory of homes for sale remained somewhat limited relative to historical levels and compared with the pace of demand. However, buyers in many neighborhoods still had many more homes to choose from this year compared with last year. Inventory increased by 26% to nearly 8,000 homes as of the third quarter. The largest increases in inventory were in the outer SF Bay Area counties, most notably Napa, where inventory was 60% greater than last year. Meanwhile, inventory was more stable in the inner SF Bay Area as robust buyer activity absorbed new listings in most neighborhoods.

MIXED SALES RESULTS AVERAGE OUT TO LITTLE CHANGE

Sales activity was greater than last year in half of the SF Bay Area counties and decreased in the other half, which resulted in little change at the regional level in aggregate. There were nearly 11,000 closed sales in the third quarter of 2025, on par with last year. Tight inventory continued to constrain buyer activity in some areas, particularly neighborhoods in San Francisco and Santa Clara counties. Conversely, sales activity increased in counties where inventory grew most rapidly, including Napa, Santa Cruz and Sonoma, which are also counties where second homes make up a larger share of sales. Notably, inventory in San Mateo County was tight, but closed sales increased by 6% as of the third quarter.

HIGHER PRICE TIERS LEAD THE WAY

Sales in the upper price range were a stabilizing factor for total volume in most counties, offsetting a slower number of sales in lower price segments. Sales of homes priced at more than $2.5 million increased by 7% year-over-year in the SF Bay Area. Of these, nearly 700 homes sold for more than $3.5 million, an increase of 12% compared with last year. Closings among other price segments were more stable year-over-year. Fewer homes sold for less than $1.25 million in San Francisco, Santa Clara and Marin counties after recent price gains reduced the number of homes in this category. Higher mortgage rates, and perhaps buyer hope for lower rates in the near term, were also a significant constraint for buyers in this lower-price segment. However, there were initial signs that the decrease in mortgage rates earlier in the quarter spurred greater buyer activity in this segment towards the end of the third quarter.

A MORE BALANCED MARKET

Demand for the relatively limited number of SF Bay Area homes remained strong, highlighted by recent sales activity. Even so, the share of homes sold over asking and the number of days homes spent on the market moved closer to a historical equilibrium. Homes that sold in the third quarter spent a little more than a month on the market, on average, and 42% sold for more than the list price. Notable exceptions included San Francisco, where roughly 70% of all sales closed above the asking price, a share that led the SF Bay Area. These sellers accepted offers more than 20% over asking, on average, which was also the largest premium among SF Bay Area counties.

PRICES SHOW MARKET STRENGTH

The median sales price in the SF Bay Area increased slightly in the third quarter, and may have increased more but for the fact that a greater proportion of sales were in counties with relatively lower median prices. The median sales price in the SF Bay Area was $1.3 million, a 1.5% increase year-over-year. The median sales price increased in six of ten SF Bay Area counties, with year-over-year gains of more than 2.5% in Marin, San Francisco, and Santa Clara counties. The median price declined by nearly 8% in Napa County.

LOOKING AHEAD

While relatively strong, the SF Bay Area housing market continued to move into a steady state environment in the third quarter. Inventory, days on market and sales over asking all approached a more normal level relative to historical averages. Affordability remains a constraint for many buyers, but potentially lower mortgage rates in the coming months may help bring some of these buyers off of the sidelines. At its September meeting, the Federal Reserve signaled that further reductions in the benchmark interest rate are very likely this year. A cut in rates may put some downward pressure on mortgage rates. This improved affordability combined with a reopening of the IPO market following the government shutdown should be additive to potential sales activity. Combined with the deep pool of housing demand in the SF Bay Area, even a modest drop in mortgage rates would spur positive momentum as we close out the year.

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