Santa Clarita Homebuyers Beware: What This Quiet Market Shift Could Cost
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Santa Clarita Homebuyers Beware: What This Quiet Market Shift Could Cost
Connor “with Honor” MacIvor - June 20, 2025** Tags: [Santa Clarita real estate](/-/Blog/tag/Santa Clarita real estate), [2025 housing forecast](/-/Blog/tag/2025 housing forecast), [Connor MacIvor](/-/Blog/tag/Connor MacIvor), [Santa Clarita open houses](/-/Blog/tag/Santa Clarita open houses), [Valencia CA real estate](/-/Blog/tag/Valencia CA real estate), [Saugus CA homes for sale](/-/Blog/tag/Saugus CA homes for sale), [Canyon Country real estate market](/-/Blog/tag/Canyon Country real estate market), [Santa Clarita housing market update](/-/Blog/tag/Santa Clarita housing market update), [California real estate forecast 2025](/-/Blog/tag/California real estate forecast 2025), S ** 0 Comments | Add Comment
Santa Clarita Real Estate Mid-2025: Navigating the Twists and Turns of a Shifting Market
TL;DR
The Santa Clarita real estate market in mid-2025 is on a long road to recovery, reflecting broader California trends. While the frenzy of past years has subsided, the market is far from crashing. Key indicators show a normalization period: mortgage rates are expected to continue a downward trend into the high 5% range by year’s end, but home prices are still forecast to climb, increasing the wealth of homeowners but further challenging affordability. Locally, homes are staying on the market longer than the seasonal lows of previous years, and a significant number of price reductions indicate that sellers are having to adjust their expectations to meet the current reality. For both buyers and sellers, navigating this complex environment requires expert guidance and a deep understanding of the data.
The Big Picture: California’s 2025 Housing Market Forecast
To understand where the Santa Clarita real estate market is heading, we first need to look at the statewide picture. The California Association of REALTORS® (C.A.R.) 2025 Economic & Housing Market Forecast, presented by Senior Vice President & Chief Economist Jordan G. Levine, provides critical insights into the forces shaping our local landscape. The overarching theme is one of cautious optimism; the market is “off of life support,” but there’s a “long road to recovery” ahead.
An Economy in Transition: The “Soft Landing”
For months, economists have debated whether the Federal Reserve’s efforts to curb inflation would trigger a harsh recession or a “soft landing.” According to the C.A.R. forecast, a soft landing is looking increasingly likely. While the economy is expected to grow and the market to improve, some significant challenges remain.
Headline numbers suggest a strong economy, with both California and U.S. Real GDP Growth showing resilience. The state’s job market has also shown periods of robust growth. However, there are underlying complexities. The labor force data reveals a “tale of two surveys,” with civilian employment figures showing fluctuations and the unemployment rate in California, while improving from its peak, still a point of concern.
Furthermore, inflation, while easing from its highs, hasn’t translated into lower prices for consumers on the ground. This creates a bifurcated economy, split by income levels, where aggregate numbers for retail sales and household income might look positive, but many families are still feeling the squeeze. This financial pressure is evident in the rising credit card delinquency and charge-off rates, which have climbed steadily through 2023 and 2024.
Another potential risk on the horizon is the commercial real estate sector, particularly office space. Vacancy rates in major California cities, including Los Angeles, have soared to historic highs, a trend that could have ripple effects on the broader economy.
Interest Rates: The Decisive Factor
No single factor has impacted the housing market more over the past few years than mortgage rates. The C.A.R. forecast emphasizes that for housing, “the bond market, not the Fed matters for mortgage rates”. While the Federal Funds Target Rate set by the Fed influences the economy, it’s the 10-Year Treasury yield that most directly correlates with 30-year fixed mortgage rates.
The aggressive rate hikes of 2022 and 2023 had a clear and negative impact on buyer demand, as seen in the sharp drop in purchase applications whenever rates spiked. While rates in late 2024 were “actually pretty good” in a historical context, they remained high enough to sideline many potential buyers and sellers.
The forecast for 2025 brings a glimmer of hope. The September 2024 C.A.R. projection anticipates the 30-year fixed-rate mortgage (FRM) to average 6.6% in 2024 and fall to 5.9% in 2025. While rates are expected to come down, the advice from economists is clear: “I wouldn’t wait around”. The market is volatile, and trying to time the absolute bottom of the rate cycle is a fool’s errand.
State of the Housing Market: Sales and Prices
The California housing market is still waiting for sustained rate relief. Sales of existing single-family homes are starting to bounce back from the lows of 2023 but remain volatile month-to-month. The forecast for 2025 projects 304,400 sales, a significant improvement from the 275,400 estimated for 2024, but still well below the levels seen in 2020 and 2021.
Regionally, performance is varied. In late 2024, the Bay Area and Central Valley were outperforming other areas in year-over-year sales growth, while Southern California saw modest gains. A key leading indicator for the market is the high-end price segment. As of September 2024, sales in the $2 million+ category were showing strong positive growth, suggesting confidence among affluent buyers.
Statewide median prices have normalized after the massive surge during the pandemic but are set to rise further. After a projected 6.8% increase in 2024 to a median of $869,500, the C.A.R. forecast predicts another jump to $909,400 in 2025. This continued price appreciation, while excellent for homeowners building equity, further exacerbates the state’s affordability crisis.
The Enduring Challenge: Affordability and Supply
The “preexisting conditions” of California’s housing market remain untreated. The most significant are the structural shortages in housing supply and the resulting crisis of affordability.
Decades of under-building have left California with a severe housing deficit. The number of residential building permits issued has been declining since the 1970s and 1980s, with the 2020s on track to be one of the slowest decades for new construction on record.
This lack of supply, coupled with rising prices, has pushed the Housing Affordability Index to its lowest levels since 2007. As of the second quarter of 2024, only 14% of California households could afford to purchase a median-priced home, compared to 33% nationwide. This is the “golden rule of CA real estate” in action: prices go up, rates go down, but affordability can still decline.
Adding to these woes is a new challenge: homeowners insurance. The percentage of buyers who had difficulty obtaining insurance has skyrocketed. In 2024, 31% of all buyers faced difficulties, up from 16% in 2023. The problem is even more acute in suburban and rural areas, which are prevalent throughout the Santa Clarita Valley. This is a critical factor that buyers must now consider early in their home search. For guidance on navigating these challenges, our Buyers Guide offers comprehensive strategies.
A Local Lens: What’s Happening in Santa Clarita?
While the statewide data provides the context, real estate is always local. The trends in the Santa Clarita Valley—encompassing communities like Valencia, Saugus, Newhall, Canyon Country, Castaic, and Stevenson Ranch—paint a detailed picture of a market in flux.
Days to Sell: A Market Finding Its Pace
One of the most telling local indicators is the median “Days to Sell.” This metric, which tracks the time from when a home is listed to when it goes into escrow, reveals the speed and temperature of the market.
According to data for single-family residences in the Santa Clarita Valley, the median days to sell in May 2025 was 18 days. Let’s break down what that number means by comparing it to previous periods:
This data confirms that the frantic, “multiple-offers-in-24-hours” environment has cooled. Buyers have more time to consider their options, and sellers must be more patient. The market isn’t stagnant, but it has shifted away from the extreme seller’s advantage of the pandemic era. For a personalized analysis of your community, check out our detailed Santa Clarita Market Report.
The Pulse of the Market: A 7-Day Snapshot of SCV Real Estate
To get the most current view, let’s examine the market activity in Santa Clarita over the past seven days (as of mid-June 2025):
The most striking number here is the 128 price changes. This is a powerful signal that sellers are having to adjust their initial asking prices to attract buyers. In a hotter market, price reductions are rare. In today’s market, they are a necessary tool for many sellers. It indicates a disconnect between seller expectations and what buyers are willing or able to pay. This directly aligns with the “Days to Sell” data; as homes sit on the market longer, sellers become more motivated to make a change.
The 90 new listings show that inventory is still flowing into the market, giving buyers fresh options. The 55 closed sales demonstrate that deals are getting done every week. This is not a market in paralysis. It’s a market of negotiation, strategy, and adjustment.
For Santa Clarita Home Sellers: Strategies for Success in a Normalizing Market
Selling your home in the current Santa Clarita market requires a different approach than it did two years ago. The days of simply putting a sign in the yard and watching the offers roll in are over. Here’s how to succeed.
Pricing is Everything
The 128 price changes in one week tell a clear story: overpricing is the kiss of death in this market. Your home’s initial list price is the most critical factor in your success. If you price too high, you risk languishing on the market, which leads to the dreaded “price reduction” scenario. Buyers become wary of homes that have been sitting for a long time or have had multiple price drops, often wondering, “What’s wrong with it?”
The key is to price your home correctly from day one. This requires a deep, data-driven analysis of comparable sales, current competition, and market trajectory. An automated estimate from a national portal simply can’t provide the nuanced, local expertise required. This is where a professional evaluation is invaluable. If you’re considering selling, start with a Free Market Analysis from an expert who understands the unique dynamics of your specific neighborhood.
Preparation and Presentation
With buyers having more options and more time, the presentation of your home is paramount. A home that is clean, decluttered, and well-maintained stands out from the competition. Consider these steps:
For a complete checklist on how to prepare your property, consult our comprehensive Sellers Guide.
The Power of Expert Marketing
In a competitive market, your agent’s marketing plan is crucial. It should go far beyond simply putting the listing on the MLS. A robust strategy includes professional photography, compelling property descriptions, targeted digital advertising, and leveraging a network of local agents.
At Santa Clarita Open Houses, we employ a multi-faceted approach to ensure your home reaches the widest possible audience of qualified buyers. My background as a first responder means I bring a level of discipline, strategy, and commitment to the process that is unmatched. Learn more about my unique approach on my about page.
For Santa Clarita Home Buyers: Finding Opportunity Amidst Change
This normalizing market presents significant opportunities for savvy buyers. While affordability remains a challenge, the shift in market dynamics gives you more leverage and breathing room than you’ve had in years.
Get Prepared and Be Ready to Act
Your first step, before you even look at a single home, is to get pre-approved for a mortgage. In today’s climate, a pre-approval letter is non-negotiable. It shows sellers that you are a serious, qualified buyer, which is essential when you make an offer. Furthermore, it gives you a clear understanding of your budget so you can search with confidence. You can start the process here and get pre-approved.
Don’t Try to Time the Market
With rates forecast to fall further, it can be tempting to wait on the sidelines. However, this can be a risky strategy. The C.A.R. forecast also predicts that the median home price in California will continue to rise, potentially reaching over $909,000 in 2025. Any savings you might gain from a slightly lower interest rate could be wiped out by a higher purchase price.
The adage “marry the house, date the rate” has never been more relevant. You can always refinance your mortgage when rates fall in the future, but you can’t go back in time and buy today’s house at today’s price. The concept of “buy the dip” suggests that periods of market softness can be the best times to make a purchase.
Leverage Your Agent’s Expertise
In a market with more inventory and longer days on market, you have more room to negotiate. An experienced agent can help you analyze comparable sales to formulate a strong offer, negotiate on price and terms, and request repairs or concessions.
Furthermore, an expert local agent provides access to tools and listings you won’t find on national portals. Whether you are looking for a home with a pool or a property in a specific school district, our Advanced Search tools and local knowledge can help you find your Dream Home.
The Connor with Honor Advantage: Why Expert Guidance is Non-Negotiable
The data is clear: the Santa Clarita real estate market of mid-2025 is more complex and nuanced than ever before. Statewide economic forces, shifting local trends, and new challenges like the insurance crisis have created an environment where professional guidance is not a luxury—it’s a necessity.
Whether you are buying or selling, you need a trusted advisor who can cut through the noise, interpret the data, and craft a strategy that achieves your specific goals. As a real estate professional and former first responder, I bring a unique combination of analytical rigor, strategic thinking, and a profound commitment to serving my clients with honor and integrity. My clients’ success stories are a testament to this dedicated approach, which you can read in their own words on our testimonials page.
The market is constantly evolving. Don’t navigate it alone. If you’re ready to make a move or simply want to understand your options, let’s connect and start the conversation.
Key Takeaways
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My recommendations are based on YOUR specific needs and the complexity of your situation—not who pays the highest referral fee. I live in Santa Clarita Valley, and my reputation in this community depends on your success. Local accountability matters.
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