SAN FRANCISCO (KRON) — There’s finally some good news for Bay Area homebuyers: home prices are going down. According to latest National Housing Report from real estate company RE/MAX, home prices in the San Francisco Bay Area experienced the largest year-over-year decline in the United States.

The key to success in this changing market for both buyers and sellers will depend on which area they are negotiating in, according to Tim Yee, President of RE/MAX Gold Bay Area. Though prices are down in the Bay Area, home sales are also down; the area saw a 41% decrease in home sales in 2022 compared to 2021.

Homes are also staying on the market longer than they were during the height of the pandemic. The average Bay Area house is now on the market for 46 days, which is 51% longer than sellers saw the year before. The full numbers breakdown from RE/MAX is shared below.

MarketDec 2022
Median Sales Price
Dec 2021
Median Sales Price
Year-over-Year % Change
San Francisco, CA$985,929$1,038,444-5.1%
Los Angeles, CA$810,000$850,000-4.7%
Honolulu, HI$670,000$700,000-4.3%
Seattle, WA$629,975$655,000-3.8%
Phoenix, AZ$415,000$430,000-3.5%
Data courtesy of RE/MAX

“As with many markets around the country, there are certain ‘pockets’ that will always do well and some that will also reflect the challenging environment of high-interest rates, large employment layoffs and seasonal slowing leading to market uncertainty,” Yee told KRON4.

With home inventory sitting at a historic low, home prices are not declining as fast as they could be, and the spring season could bring higher inventory and a more active market, Yee tells KRON4. “As consumers adjust to the new normal, the market should be less inclined to major average price variations in either direction,” Yee said.

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As home prices have come down, so have final buying prices. RE/MAX studied the close-to-list ratio over the past two years and found that people buying homes in San Francisco are paying close to the listing price rather than over it. In Dec. 2021, 107% of of homes sold above their listing price, but by Dec. 2022, that number had decreased to 99.1%.

MarketMedian Sale Price
Dec. 2022
Median Sale Price
Dec. 2021
% Change
Year over year
San Jose$1,180,000$1,295,000-8.9%
Redwood City$1,833,125$1,650,00011.1%
Mountain View$1,658,000$1,600,000-3.5%
Data courtesy of Redfin

Data pulled from real estate company Redfin’s database shows that though prices were down in many cities across the Bay Area, though Redwood City was an exception. The city saw a steep increase in prices from 2021 to 2022, with the median price increasing by 11.1%.