Oakland home prices fall sharply, among the steepest declines in the nation
Oakland's housing market is seeing some of the steepest price declines in the country, with home values falling sharply as sellers, buyers and real estate agents navigate a difficult market.
New data from real estate company Zillow shows Oakland home values have dropped more than 11% over the past year, adjusted for inflation, tying the city with Cape Coral for the largest decline in the nation.
The typical home in Oakland is now valued at about $716,000, according to Zillow.
Real estate agents say the market slowdown began after mortgage interest rates surged in 2022, making homes less affordable and cooling buyer demand.
"Oakland homes are sitting on the market longer and selling for less," said Beth Tehrani, a realtor with Redfin.
Tehrani said sellers are adjusting to a market that no longer resembles the rapid price growth prior to 2020.
"Before, sellers had the same mentality as during COVID," Tehrani said. "But now they understand if they don't price it right, the property will be sitting on the market for a longer time."
Some homeowners say they are preparing for further uncertainty.
Frank, an Oakland homeowner who asked that his last name and address not be used until he formally lists his home, is renovating his property in the southern Oakland Hills and says he is prepared to wait out the market if prices continue to fall.
"Let's say hypothetically the bottom falls out of the market within the next month or so," Frank said. "I can sit for a year and just wait."
Real estate agents and analysts say concerns about crime, a struggling downtown and changing buyer preferences have also weighed on the market.
Some neighborhoods are being hit harder than others.
Downtown Oakland and condo-heavy neighborhoods have experienced some of the sharpest declines, while wealthier areas such as Rockridge and Temescal remain competitive, with some homes still drawing multiple offers.
"The condo market downtown is really suffering," Tehrani said. "Most of the properties are condos and were built before COVID, and a majority of them are just sitting more than 90 days."
A home near Lake Merritt was sold late last year at a loss of about $150,000 after the previous owner feared values would continue to decline.
Despite the downturn, some homeowners remain optimistic that desirable neighborhoods within Oakland will continue to attract buyers.
"I've seen a lot of houses go on the market," Frank said. "The ones that are selling are selling at good prices."
Housing experts say that while buyers may have more negotiating power in some parts of Oakland, elevated mortgage rates continue to keep monthly payments out of reach for many would-be homeowners.
According to Zillow data, Oakland home values have fallen nearly 30% since 2019 when adjusted for inflation.