California housing in 2025 still feels like its own ecosystem. From Silicon Valley’s sky-high price tags to the quieter corners of the Central Valley, where costs are lower but access is different, it’s not one-size-fits-all.
For people trying to figure out whether to rent or buy, or just wondering what their options even look like, the answers depend heavily on where you’re looking and what you can afford.
Let’s break it down with real numbers, specific regional differences, and practical insights.
Where Things Stand in 2025
California’s housing market in 2025 is still expensive, still in demand, and still deeply shaped by where you’re looking. Here’s a look at the latest average rents and home prices across the state as a whole.
Average Rent Across California
As of mid-2025, the average monthly rent for a 2-bedroom apartment in California is sitting around $2,791, based on iPropertyManagement data. Zillow places the statewide average a touch higher at $2,800, which includes all bedroom sizes and types of rental properties.
That’s down slightly from July 2024, when the median rent was $2,825. While not a dramatic drop, it’s the first time in a while rents haven’t climbed.
That flattening out gives renters a little breathing room, especially compared to the rapid price hikes during the pandemic and its aftermath.
Median Home Prices
On the ownership side, things remain steep. The median price for a 2-bedroom home is around $838,850, as per car.org.
If you zoom out to all home types, the California Association of Realtors (C.A.R.) is forecasting a statewide median price of $909,400 for 2025. That’s up 4.6% from 2024’s projection of $869,500.
Even with more homes hitting the market, prices are still climbing due to steady demand, high construction costs, and not enough supply in key areas.
Affordability Is Still the Elephant in the Room
For many Californians, the dream of owning a home is slipping further out of reach.
To qualify for a mortgage on a mid-tier home, buyers in 2025 need an income of around $237,000 per year, according to the Legislative Analyst's Office (LAO).
That’s over double the median household income of $96,500 in 2023. Even a bottom-tier home, priced lower than 65% of the market, requires about $145,000 annually.
Here’s a quick look:
| Home Tier | Monthly Cost (PITI) | Required Annual Income |
| Mid-Tier Home | $5,900 | $237,000 |
| Bottom-Tier Home | $3,600 | $145,000 |
Renting isn’t exactly cheap either, but it’s a lighter monthly hit. A typical 2-bedroom costs $2,791, making it about $2,010 less per month than buying.
How the Numbers Vary by Region
California is too big and too diverse to be summed up by a single average. Let’s look at how different regions stack up.
Median Home Prices by Region – April 2025
| Region/County | Median Home Price | Year-over-Year Change |
| San Mateo | $2,281,500 | +6.1% |
| Santa Clara | $2,121,000 | +6.1% |
| Marin | $1,720,000 | +1.2% |
| Orange | $1,417,450 | -1.6% |
| Alameda | $1,351,000 | -3.6% |
| San Francisco | $1,419,000 | -1.7% |
| Santa Cruz | $1,277,500 | -10.0% |
| Los Angeles | $850,270 | +2.9% |
| San Diego | $1,015,000 | -3.1% |
| Riverside | $645,000 | +0.5% |
| San Bernardino | $499,500 | -0.1% |
| Fresno | $425,000 | +0.7% |
| Kern | $395,000 | +4.8% |
The Bay Area still claims the highest prices, with San Mateo and Santa Clara well over the $2 million mark. Those numbers reflect the tech sector’s influence, low inventory, and high-income buyer base.
Southern California shows more variation. Orange County is expensive, Los Angeles is slightly more approachable, and Riverside and San Bernardino remain within reach for middle-income buyers.
The Central Valley offers a far more affordable entry point. Kern and Fresno Counties hover below the $450,000 mark.
Regional Rents - Fair Market Rents (FMRs) as a Proxy
Exact rent averages are harder to pin down across counties, but Fair Market Rents from RentData.org give us a baseline.
These figures reflect the 40th percentile of typical rent prices, so actual market rates could be higher, especially in sought-after cities.
| Region/County | 2-Bedroom FMR (2025) |
| Santa Cruz-Watsonville | $4,223 |
| San Francisco HUD Metro Area | $3,318 |
| Oakland-Fremont HUD Metro Area | $2,682 |
| Sacramento-Roseville-Arden Arcade | $2,206 |
| Alpine County | $1,445 |
| Modoc County | $1,054 |
Renters in Santa Cruz and San Francisco face the steepest rents, with two-bedroom places often running over $3,000 a month. Inland counties like Modoc offer dramatically cheaper rents, but are also rural with fewer jobs and services.
The Impact of Natural Disasters on Housing
View this post on Instagram
In early 2025, wildfires swept through parts of Southern California, leaving a noticeable impact on local housing markets, Redfin reported.
Altadena saw its median home price drop 39.1%, from $1.425 million in 2024 to $867,500 in 2025. In Pacific Palisades, prices fell 23.7%, down to $2.525 million.
If you’re facing property ownership disputes or trying to resolve a co‑owner disagreement in San Diego after disruption by events like wildfires, consider consulting Underwood Law for partition‑action legal guidance.
With homes damaged or destroyed, many residents turned to rentals. That surge in short-term demand increased pressure on local rental markets, especially for larger units.
What’s Driving Price Growth in 2025?
Home prices across California aren’t rising at random - several key forces are quietly shaping the market behind the scenes. From tight inventory to stubbornly high mortgage rates, here’s what’s fueling the steady price growth in 2025.
Home Price Factors
- Inventory is still tight. Even with listings up 17.6% year-over-year in June, there’s only about 3.5–4 months of available housing, short of the 5–6 months considered balanced.
- Mortgage rates are high. The average 30-year fixed rate in June 2025 sits at 82%. That’s a big jump from the sub-3% rates in early 2021.
- Sellers are holding. Over 80% of homeowners have mortgage rates under 5%. Many don’t want to give that up, so they’re staying put.
Rental Market Trends
- Rent increases are slowing. Zillow’s data shows a very modest decline since 2023. Some landlords are adjusting expectations due to softening demand in high-end rentals.
- More units are available. As of 2025, there are over 83,000 rentals listed statewide, which gives renters more options.
- Inland affordability helps. While demand stays strong near the coast, inland counties are seeing increased interest for budget-friendly rentals.
Advice Based on Region
Housing decisions in California often come down to location. Here’s what to keep in mind whether you're leasing, renting, buying, or relocating, because what makes sense in Fresno won’t look the same in Santa Cruz.
Renters
If you're renting and trying to keep things affordable:
- Look to inland or rural counties. Cities like Ivanhoe, Exeter, and Hamilton City are among the cheapest in the state.
- Keep that 30% income rule in mind. If your monthly rent is around $2,800, you’ll want a household income of at least $100,000 to stay in a healthy financial range.
Buyers
For those eyeing the real estate market:
- Central Valley counties like Fresno and Kern are among the most accessible. Fresno’s median home is around $425,000.
- Inland Empire locations like San Bernardino offer a balance between proximity to Southern California metros and lower home prices.
- Budget for a high monthly payment if you’re buying. Even with a 20% down payment, buyers are looking at payments close to $4,800/month for a 2-bedroom statewide average home.
Thinking About Relocating?
- Coastal areas have the highest costs but often the strongest job markets and access to culture, services, and infrastructure.
- Inland counties give you more space and lower costs, but you might trade off commuting options or job availability.
- Long-term, prices and rents are still expected to climb modestly, so locking in lower rates or rents now could help you stay ahead.
A Look at the Bigger Picture
Housing costs in California keep pushing up against people’s budgets. From 2020 to mid-2025, average wages rose about 23%, but the monthly cost of owning a home jumped over 80% during that time. That mismatch explains a lot about why more people are renting longer, delaying homeownership, or leaving the state altogether.
The good news is that price growth is slowing, and mortgage rates are expected to dip a bit by the end of 2025, possibly down to 5.9%, which could make a big difference for future buyers.
