California’s Top Premium Markets Show Divergent Trends

California’s most expensive housing markets are posting mixed results, with price per square foot ranging from $706 to $989 among top metros. While all significantly exceed state and national medians, their selling speeds and market conditions vary widely.

Santa Barbara leads the state at $989 per square foot, followed by San Jose at $962. Both metros price well above California’s $409 median and dwarf the national median of $213. Yet their market dynamics differ substantially.

San Jose maintains momentum while others slow

San Jose moves homes in a median 42 days with 28.3% of listings cutting prices. The metro absorbed 180 properties against 109 new listings last week, maintaining 1.4 months of inventory. These metrics place it in seller-favorable conditions.

Napa presents a contrasting picture. At $706 per square foot, homes take 126 days to sell—three times longer than San Jose. Price cuts affect 38.4% of listings, and the market holds 4.8 months of inventory. The metro absorbed 24 homes while adding 14 new listings.

Price cuts reveal competitive pressures

California metros show elevated price-cut activity compared to the national rate. Napa leads at 38.4%, followed by Salinas at 35.2% and Santa Barbara at 32.5%. San Jose posts the lowest rate at 28.3%, still approaching the typical range.

Statewide, 36% of California listings reduced prices, below the national 41.9% rate. This positions California metros between state and national averages, with individual markets reflecting local supply-demand dynamics.

Inventory levels signal market direction

Months of supply ranges from San Jose’s tight 1.4 months to Napa’s 4.8 months. Salinas holds 1.6 months while Santa Barbara maintains 2.3 months. California overall shows 2.3 months of inventory, below the national 2.9 months.

The spread demonstrates how premium pricing alone does not determine market velocity. San Jose and Salinas maintain tighter conditions despite different price points, while Napa’s luxury positioning correlates with extended marketing times.

What to watch

Track the 42- to 126-day range for realistic seller expectations in premium California markets. Monitor price-cut percentages between 28% and 38% as competitive positioning indicators. Use inventory levels from 1.4 to 4.8 months to gauge whether conditions favor buyers or sellers. Compare local metrics against California’s 70-day median and 2.3 months of supply for context.

HousingWire used HW Data to source this story. To see what’s happening in your own local market, generate a housing market report. For enterprise clients looking to license the same market data at a larger scale, visit HW Data.