California Home Purchases Hit Near 2-Decade Low

Cooling mortgage rates fail to offset high prices and cancellation rates in the Golden State

Jan. 29, 2026 at 1:07pm

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California home sales have fallen to a 21-year low, with the tally of existing and new homes sold in November 2025 down 30% from the average. Despite a decline in borrowing rates towards the end of the year, high home prices and sky-high contract cancellation rates have continued to deter would-be buyers in the state.

Why it matters

The sharp decline in California home sales reflects broader economic challenges, including persistently high housing costs that remain out of reach for many prospective buyers. This trend has significant implications for the state's real estate market, construction industry, and overall economic health.

The details

In November 2025, a total of 23,317 existing and new California homes were sold, an 8% drop from the previous year. Mortgage rates averaged 6.3% in the three months ending in November, but this failed to encourage buyers facing median home prices of $735,000 - just 2% below the state's peak of $751,000 in June 2025. Buyer hesitancy is evident in high rates of home-purchase contract cancellations, with Riverside at 19.2% and Sacramento at 19.9% - the nation's highest.

  • In November 2025, a total of 23,317 existing and new California homes were sold.
  • Mortgage rates averaged 6.3% in the three months ending in November 2025.
  • California's median home sales price reached $735,000 in November 2025.

The players

Attom

A real estate data firm that provided the sales data cited in the article.

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The takeaway

The steep decline in California home sales underscores the ongoing challenges facing the state's housing market, with high prices and economic uncertainty continuing to deter many prospective buyers despite lower mortgage rates. This trend has significant implications for the broader economy and highlights the need for solutions to address the state's persistent affordability crisis.