Market Pulse January 2025: Wildfires, rates, and the evolving California housing market

Our hearts go out to everyone impacted by the devastating wildfires in Southern California. With insured losses projected to reach up to $20 billion, these events will have a significant impact on the state's housing market, including buyers and sellers in the San Francisco Bay Area.

As relief efforts continue, the fires are already having major effects on California's home insurance situation. Over the last year, many policies have been dropped by insurance carriers up and down the state, pushing many to resort to the FAIR Plan for home insurance. While a mandatory moratorium temporarily protects some Southern California wildfire-affected homeowners, there are concerns that these events will deplete FAIR Plan funds and lead to reliance on remaining private insurers who may further increase premiums or deny coverage. 

Rising insurance costs and limited coverage options could put plans on hold for some buyers statewide, but adding to the complexity, mid-January mortgage rates surged back above 7%. The Federal Reserve signals limited rate cuts this year.

According to Brady Thomas, Senior Mortgage Advisor at LaSalle Mortgage, “For mortgage rates to drop, we need inflation to cool off, the job market to slow down, and maybe even a little luck.” He notes that buyers looking for the best rates must keep up with their great credit by paying bills on time and keeping credit card balances low.

In these uncertain times, a trusted, knowledgeable real estate agent with local expertise, professional diligence, and utmost care is invaluable in helping buyers and sellers navigate the challenges of California’s evolving real estate market.

How to help those affected by Southern CA fires • How to help students impacted by the fires

Sources: Realtor.com, Brady Thomas/LaSalle Mortgage, ABC 7 News KGO

East Bay Market Snapshots: Single family homes, condos, and townhomes as of January 2025

Here is the latest market data from around the East Bay for single-family homes, condos, and townhomes available as of January 2025.

Alameda County - Single Family Homes

Alameda County - Condos & Townhomes

Contra Costa County - Single-Family Homes

Contra Costa County - Condos & Townhomes

Sources: Bay East Association of Realtors and Contra Costa Association of Realtors.

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