California’s housing market has been stuck in neutral much of the past year, with lower-than-average home sales and little, if any, price growth.
But there are some cities that remain competitive, where many homes often sell for above the listing price because of multiple offers and enter escrow within two weeks. Good luck finding and buying a home in Sunnyvale, Santa Clara, Mountain View and San Mateo.
Those four cities are among nation’s 10 most competitive housing markets – based on the number of days before entering escrow – are in California, according to a Redfin report. Nine of the top 25 most competitive cities are in California, and the Bay Area (check table, below).
EVERYTHING’S SUNNY IN SUNNYVALE
Cheer or jeer Ai, but the fast-growing tech has helped boost paychecks and, in turn, home sales during the past year.
The Bay Area has been the most resilient, and in some ways the most volatile, market in California.
The nine-county region’s median-home price – meaning half the homes sell for more, the other half for less — dipped to $1.28 million in November, off 3.2% from a year ago. Sales declined 3.5%.
But in the core Bay Area, think San Francisco and San Jose, home sales are solid. In Sunnyvale, the second most competitive market in the nation and where the median sale price is $2.67 million, the average home enters escrow in less than 10 days and almost 40% sell for more than the listing price.
Western New York state – Rochester and Buffalo – are also competitive markets in the U.S. Irondequoit, a suburb of Rochester, is the most competitive, but with a median sale price of $249,000, there are a lot more buyers who can afford a home there than in the Bay Area.
Feature photo: High-rise buildings in Sunnyvale via Adobe Stock
Housing slowdown? Not in these Bay Area cities
| City | Median sale price | Median days on market | % of homes sold above list price | % of homes sold in two week |
|---|---|---|---|---|
| Sunnyvale | $2.67 million | 9.6 | 37.4% | 52.6% |
| Santa Clara | $1.99 million | 10.1 | 31.3% | 22.2% |
| Mountain View | $2.65 million | 10.3 | 80.2% | 65.9% |
| San Mateo | $2.03 million | 12.1 | 47.2% | 65.7% |
| Cupertino | $3.45 million | 14.5 | 33.5% | 39.7% |
| Palo Alto | $3.89 million | 13.3 | 54.1% | 68.5% |
| San Jose | $1.7 million | 14.5 | 57.1% | 64.5% |
| South San Francisco | $1.29 million | 16.1 | 75.5% | 71.2% |
| Berkeley | $1.57 million | 15.6 | 58.6% | 65.1% |
Source: Redfin
Home-flippers are experiencing the worst market in almost two decades. ADOBE STOCK
Fixer-upper to budget-buster: The flip is flopping
Home-flipping profit margins dropped to the lowest level since the Great Recession – and the returns were even worse in California.
The average home-flipping profit margin plummeted to 23.1% during the third quarter, compared to 26.5% in the second quarter – and off from 29.8% a year earlier, according to ATTOM Data.
The current profit-margin is the lowest since second-quarter 2008, and the latest evidence of a decline over the past several years of the one-time fast-growing make-it-rich opportunity for do-it-yourselfers. The dream has been doused by reality, and a return to profit margins last seen when the housing market collapsed and the early days of the Great Recession.
‘THE GAME HAS FUNDAMENTALLY CHANGED’
In California, the average profit-margin was 18.1%, a slight decline from the 18.3% in the second quarter – and far from the 40% to 60% returns from about 2009 to the months before the pandemic started.
It’s an about-face for a small-but-critical part of the housing market.
“Rising home prices and shrinking margins have made flipping increasingly challenging,” said ATTOM CEO Rob Barber. “The flipping market … has now settled into five straight quarters of returns in the 20% range. Investors must choose their markets more carefully as the game has fundamentally changed.”
FRESNO, BAKERSFIELD ARE THE BEST FLIPPING MARKETS
California could be one of the most challenging markets for home flippers nationwide. Only two of the eight major markets in the state had profit margins that exceeded the national average, according to ATTOM.
Central Valley’s Bakersfield and Fresno, among the most affordable housing markets in the state, enjoyed profit margins of 38%. The rest of the state – from the Bay Area and Sacramento region to San Diego – is a huge mess.
Riverside and San Diego’s profit-margins were about 20%, already lower than the national average. For San Jose, the returns are a stomach-churning 13.7%.
Fresno is one of the most affordable cities in California — and one of the best for home flippers, too. ADOBE STOCK
A MONEY-LOSING EFFORT?
California paydays are still among the best in the nation, almost $112,000 statewide, but that is simply the difference between the purchase and the sale price. The figure does not include the cost of buying, fixing and selling a home, from home repairs to insurance and sales commissions.
But it’s better than the home-flipping profit of $60,000 nationwide. All eight regions in California easily exceeded that payout.
Many home-flippers are asking tough questions and are simply cutting losses than counting profits.
Flipped home sales and profit margins in third-quarter 2025
| Metro | Flipped home sales | Compared to a year ago | Profit | Profit margin |
|---|---|---|---|---|
| California | 6,204 | +5% | $115,650 | 18.1% |
| Bakersfield | 194 | -1.5% | $86,200 | 37.8% |
| Fresno | 187 | -7.8% | $103,250 | 38,2% |
| Los Angeles | 2,142 | -3.0% | $111,750 | 14.2% |
| Riverside | 4,053 | +7.3% | $138,500 | 15.9% |
| Sacramento | 450 | -1.8% | $75,000 | 16.7% |
| San Diego | 595 | +13.7% | $158,000 | 20.7% |
| San Francisco | 510 | +15.7% | $155,000 | 16.9% |
| San Jose | 216 | +18.1% | $172,500 | 13.0% |
Source: ATTOM Data
Renters often pay less than owners, but it’s far from cheap housing. ADOBE STOCK
Freeze to squeeze: How COVID changed home rents the past five years
Renting a single-family home costs more than a year ago. Or maybe the rent has dipped a little, as the demand for more space eases as the pandemic gets farther in the rearview mirror.
You can find reports to back either side.
But there is no argument when you compare single-family rents compared to five years ago at the peak of the pandemic. Rents are up. A lot.
And the never-ending question about buying vs. renting becomes even easier when you crunch the data, especially in higher-priced housing markets where finding a home to buy – or rent – is a huge hurdle, according to Zillow.
PRICES, RENTS SOAR
The average rent for homes has increased a state-leading 43% in Bakersfield in November compared to five years ago. San Diego had the second-largest boost at 41% (see table, below).
The Bay Area had the smallest rent increases – 22% and 24%, respectively – in the state. But when COVID arrived, many Bay Area renters left, especially since many jobs became work-from-home professions. So, the region has experienced a rollercoaster-like ride in recent years.
Some renters moved from the Bay Area to Bakersfield, Fresno or Sacramento to get a larger home for a lot less money. Sometimes almost $2,000 less per month.
That gap has remained the past five years.
Now, California renters are dealing with another gap – the difference between buying and renting.
Home prices have soared since November 2020. California’s median-home price was $852,680 in November 2025, a 22% increase compared to the $698,000 five years earlier, according to the California Association of Realtors.
BUY VS. RENT
Prices have barely budged the past two years, thanks largely to higher mortgage rates and near-record prices, as fewer than one of every five families can afford to buy the median-priced home in California.
Regardless, the disparity between renting and buying a single-family is widening. In the Bay Area, homeowners pay at least $6,000 more for the monthly mortgage payment than a renter (see table, below).
So, the question of buy vs. rent is simple, at least based on the math. Of course, wanna-be homeowners need to consider their options and the intangible benefits of owning a home, from controlling the monthly payment – no more rent increases – to the pride of ownership.
Rent is the lower-priced option. More affordable, not cheap.
More than half of renters (about 55%) are considered cost-burdened in California, spending at least half of their income on housing, according to the Public Policy Institute of California.
| City | Rent Nov. ’25 | Rent Nov. ’25 | % rent increase | Avg. mortgage payment |
|---|---|---|---|---|
| Bakersfield | $2,232 | $1,564 | 43% | $2,520 |
| Fresno | $2,395 | $1,730 | 38.4% | $2,790 |
| Los Angeles | $4,318 | $3,218 | 34.2% | $6,010 |
| Riverside | $3,069 | $2,212 | 38.7% | $3,940 |
| Sacramento | $2,713 | $2,124 | 27.7% | $3,460 |
| San Diego | $4,068 | $2,889 | 40.8% | $6,360 |
| San Francisco | $3,982 | $3,259 | 22.2% | $10,240 |
| San Jose | $4,434 | $3,577 | 24.0% | $12,060 |
Sources: Zillow and California Association of Realtors
