Lynn North's Market Update

December 2025 Updated Report

The real estate market began its usual mid-winter holiday season slowdown in November, marked by a substantial decline in both listing and sales activity. This contraction typically accelerates through December – normally the year’s slowest month due to the holidays – before the market begins to wake up in mid-January.

Although the inventory of new listings shrinks, December presented the period when motivated buyers can typically negotiate most aggressively, particularly on properties with extended days-on-market. As is virtually always the case, well-priced and prepared, and effectively marketed new listings can still sell quickly, often well above the asking price.

Our focus now shifts toward the New Year’s market. In the past, the beginning of the year frequently ushered in a substantially higher level of demand that continued to build into spring. This occurred in early 2025 until affected by the “tariff shock” and subsequent economic reactions, initiating a significant slowdown in April. This report reviews a wide range of real estate market indicators through November. Our January report will provide an analysis of 2025’s conditions and trends in the longer-term context of previous years.

In the broader financial landscape, the first week of December saw the S&P 500 and Nasdaq largely recover from their substantial declines in November; and the 30-year mortgage rate was close to a 14-month low. While consumer confidence showed a modest rise from November, it remains very low by long-term standards. Attention is now focused on the Feder Reserve’s upcoming decision regarding an end-of-year benchmark-rate reduction and the subsequent inflation report due later in the month. Patrick Carlisle, Compass

Based on the tariffs, we had a really slow spring market, where it basically stopped for 3 months from March through May due to the volatile stocks and uncertain economy. Note that the spring market is usually our strongest of the year! This resulted in that summer became a late spring market and more momentum for the fall market as well. 

With mortgage rates trending downward, we should see increased buyer activity and more competition for listings. As you know, the fall market is really September through October, as the market slows down for the holiday season and then picks up early in the new year!  Let me know if I can help you in any way, as it is a great time to sell too!

It is impossible to know how median and average value statistics apply to any particular home without a specific comparative market analysis. These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in San Francisco and the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.

Median list price for Santa Clara County, CA is $1,899,975. Inventory has held steady at or around 884.

Santa Clara Valley

Demographics Impact on 2026 Real Estate Market

When rates start to decline, there will be an influx of buyers and sellers. Per lenders and top analysts, we are expected to get into the mid 5.5% range by the 1st quarter 2026! 

Housing demand will be fueled by the largest generation of potential homebuyers – the millennials!

Millennials:

• US Millennials population is 72 million
• Medial age of people moving out of their parent’s home is 26
• Medial age of first-time home buyers is 35

The impact of Baby Boomers:

• Largest group of all homeowners are aged 65+
• Buyers aged 57+are more likely to downsize
• Baby Boomers are 52% of all seniors

The average homeowner equity is about $274K

*Data provided by Buffini & Inman