California, September 18, 2025
News Summary
The average home price in California has surged to $775,058, with Los Angeles prices hitting over $951,000. Potential buyers are grappling with high costs and declining homeownership rates, particularly among those aged 35-45. The current market shows a significant gap between sellers and buyers, as increased inventory has led to a shift towards a buyer’s market. Despite high mortgage rates hindering buyer confidence, assistance programs are emerging to help first-time buyers with down payments.
California — The average house price in California has reached $775,058, with prices in Los Angeles soaring to over $951,000. As the state continues to grapple with some of the highest housing costs in the nation, many potential buyers are expressing concerns about affordability and making the leap into homeownership.
According to data from Bankrate, California stands as the second most expensive state for purchasing a house, trailing only Hawaii. Historical comparisons show that the median house price in California was $177,000 in 1995, which adjusts to $381,500 today when considering inflation. Despite the drastic increase in home prices over the decades, many first-time buyers are struggling to meet down payment requirements, prompting some to lean on family or friends for financial support.
Not only are potential buyers facing high price tags, but they are also contending with demographic shifts. A study by UC Berkeley indicates a 10% decline in home ownership among those aged 35-45 since 2000, suggesting that first-time homebuyer age is rising, and many are delayed in reaching this milestone. The housing market is additionally strained by a significant disparity between buyers and sellers across the U.S., with nearly 500,000 more sellers than buyers reported in April 2023. This marks a 34% increase in sellers compared to buyers, which represents the most substantial gap since at least 2013, largely due to stagnant home sales traced back to climbing mortgage rates initiated in 2022.
As of April, the U.S. housing market recorded 1.9 million sellers but only 1.5 million buyers, creating a notable gap of 490,041. The existing conditions have compelled sellers to reduce their prices or offer incentives in a bid to attract buyers, signifying the shift from a seller’s market to a buyer’s market. In Los Angeles, the median sale price currently hovers around $900,000, with sellers outnumbering buyers by about 45%.
Despite a surge in seller activity, buyer confidence remains modest, primarily due to elevated interest rates and broader financial uncertainties. The average rate for a 30-year mortgage has climbed to 6.89%, the highest since early February 2023. While Southern California has observed minimal month-over-month increases of only 0.38% and an annual rise of 1.9% in home prices, these figures represent the smallest growth since August 2023.
One factor contributing to the increased inventory is homeowners’ decisions to sell even amidst high mortgage rates. Market conditions and economic uncertainties, including concern over inflation and trade tensions, have impacted consumer confidence and housing demand. Predictions indicate that home prices in the L.A.-Orange County area may decline by 2.4% by March 2026 as inventory levels rise.
To combat the challenges faced by first-time buyers, various homeownership programs are available to assist with down payments. A local housing fair scheduled for June 21 may offer up to $218,000 in assistance for eligible buyers. In the rental market, apartment rents in Los Angeles have experienced minimal increases, although the recent disasters from wildfires may shift rental trends.
Summary of Key Housing Data in California
- Average house price in California: $775,058
- Average house price in Los Angeles: Over $951,000
- Second most expensive state for buying a house: California
- Median house price in California in 1995: $177,000
- Current median price equivalent (adjusted for inflation): $381,500
- Home ownership decline among ages 35-45 since 2000: 10%
- Sellers vs. buyers gap: 490,041
- Average 30-year mortgage rate: 6.89%
- Predicted home price drop in L.A.-Orange County by March 2026: 2.4%
- Availability of down payment assistance: up to $218,000
FAQ
- What is the average house price in California?
- The average house price in California is $775,058.
- How much does a house cost in Los Angeles?
- In Los Angeles, the average house price exceeds $951,000.
- What was the median house price in California in 1995?
- The median house price in California was $177,000 in 1995.
- How much assistance can first-time buyers get for down payments?
- A local fair on June 21 may offer up to $218,000 in assistance for first-time buyers.
- What is contributing to the increase in housing inventory?
- Increased inventory is attributed to homeowners deciding to sell despite high mortgage rates.
Deeper Dive: News & Info About This Topic
- ABC7 News: Homebuyers May Have Upper Hand
- Wikipedia: Housing Market
- Realtor.com: Los Angeles Home Prices Down in August
- Google Search: Los Angeles Housing Market 2025
- LA Times: Housing Tracker for March
- Encyclopedia Britannica: Housing Economics
- New York Times: First-Time Buyers in Los Angeles
- Google News: California Housing Crisis
Author: STAFF HERE BEVERLY HILLS WRITER
The Beverly Hills Staff Writer represents the experienced team at HEREBeverlyHills.com, your go-to source for actionable local news and information in Beverly Hills, Los Angeles County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Rodeo Drive Concours d'Elegance, the Beverly Hills artSHOW, Concerts on Canon, and holiday celebrations throughout the city. Our coverage extends to key organizations like the Beverly Hills Chamber of Commerce and Visit Beverly Hills, plus leading businesses in luxury fashion, hospitality, and entertainment that drive the local economy. As part of the broader HERE network, including HERELosAngeles.com, HERESantaAna.com, HEREHuntingtonBeach.com, and HERECostaMesa.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
