San Gabriel Valley housing trends are shifting as California’s home prices cooled at the end of 2025, signaling a slower and more balanced market entering the new year. A statewide housing release shows the median home price declined in December from both the prior month and the same time last year, reflecting softer demand and easing competition.
California’s median home price fell to $850,680 in December, a 10-month low. The median declined 0.4 percent from November, running counter to the long-term seasonal trend that typically sees prices rise nearly 1 percent during that period. Analysts described the slowdown as more pronounced than normal for December, when competition often remains elevated due to limited inventory.
On a year-over-year basis, the statewide median price also slipped, marking the second annual decline in the past three months. The December figure represented the largest year-over-year drop since June 2023, underscoring how buyer demand weakened late in the year as borrowing costs and affordability pressures persisted.
San Gabriel Valley Housing Prices In 2025
Despite the late-year pullback, 2025 still closed with gains overall. For the full calendar year, California’s median home price increased 1.2 percent and reached a new record high of $875,550. The annual rise, while modest, continued a longer-term upward trend that has shaped San Gabriel Valley housing affordability for much of the past decade.
Local real estate professionals note that many San Gabriel Valley communities, including El Monte, Baldwin Park, and Rosemead, experienced similar dynamics. Higher inventory levels in some neighborhoods gave buyers more leverage, while sellers faced longer marketing times and fewer competing offers compared with prior years.
The December decline suggests that the balance of power began to shift as 2025 ended. Elevated inventory and slower sales activity reduced the urgency that had driven bidding wars earlier in the year, particularly for mid-priced and entry-level homes.
Housing Market Outlook
Looking ahead, analysts expect soft demand and higher inventory levels to apply continued downward pressure on prices at the start of 2026. That trend could pave the way for a more balanced housing market during at least the first quarter of the year, benefiting buyers who have struggled with affordability.
For San Gabriel Valley housing markets, a more even landscape may bring renewed activity as buyers reenter the market and sellers adjust pricing expectations. While prices remain historically high, even modest declines can influence monthly payments and buyer confidence.
Housing advocates and city officials across the valley are watching these developments closely as they consider planning, zoning, and affordability strategies. A cooler market may also affect decisions around new construction and redevelopment in transit-oriented corridors.
Community Impact And What To Watch
Residents considering buying or selling in early 2026 should pay close attention to local inventory trends and pricing adjustments. While statewide data provides context, neighborhood-level conditions will continue to vary across the San Gabriel Valley housing market.
More detailed statewide housing data and analysis are available through the California Association of Realtors at https://www.car.org. As the new year begins, the recent dip in prices suggests a period of adjustment rather than a sharp downturn, with conditions pointing toward a market that is calmer and more balanced than in recent years.
