Southern California Housing Market Update September 2026: More Room to Negotiate?
Is the Southern California housing market slowing down? August 2026 brought fewer contracts, softer pricing in several areas, and signs that buyers may have more room to negotiate.
Buyers are still looking at homes, but they’re taking more time before writing offers. Inventory tightened, pending sales slowed, and sellers showed more willingness to negotiate. Overall, Southern California appears to be moving closer toward a more balanced market.
Buyers Are Still Looking — But They’re Taking Their Time
Buyer activity didn’t disappear in August. In fact, buyers toured more homes in most of the counties I reviewed. What changed was how quickly those showings turned into offers.
Buyers needed to see more properties before a home went under contract, which suggests they’re becoming more selective.
- Comparing more homes before making a decision
- Paying closer attention to pricing
- Evaluating condition, repairs and upgrades
- Looking carefully at monthly payments
- Taking more time before committing to an offer
Fewer Homes Came on the Market in August
You might expect buyers to slow down because they suddenly have significantly more inventory to choose from. That wasn’t the case.
New listings declined across all four counties compared with July.
- Los Angeles County: 871 fewer new listings
- Riverside County: 473 fewer new listings
- Orange County: 376 fewer new listings
- San Bernardino County: 278 fewer new listings
Active inventory also declined in most of the markets we reviewed. Buyers were taking their time even though fewer fresh homes were coming onto the market.
Pending Home Sales Slowed
Pending sales give us a good indication of how many buyers and sellers are actually coming together on price and terms and opening escrow.
Across the counties reviewed, pending sales were down approximately 28% to 41% year over year. Closed sales also declined.
What this tells us: People are still shopping for homes, but fewer of those searches are immediately turning into contracts.
Buyers May Have More Room to Negotiate
This may be one of the biggest opportunities for buyers in the August market.
We saw signs of increased negotiation between buyers and sellers, including more price reductions and sellers receiving less than their original asking price in some transactions.
And negotiation isn’t limited to the purchase price.
- Purchase price
- Repairs
- Closing-cost credits
- Seller concessions
- Contract terms and timelines
Every property and transaction is different, but buyers may have more leverage today than they did in a faster-moving market.
What Happened to Southern California Home Prices?
Pricing was mixed depending on the county.
- Los Angeles County: Average sales prices moved lower compared with July.
- Riverside County: The average sales price was approximately $729,000, about $22,000 lower than the previous month, while remaining slightly higher year over year.
- San Bernardino County: The average sales price was approximately $629,000, about $23,000 higher than July.
- Orange County: Average sales prices declined month over month while remaining higher than the previous year.
This is why I always caution against treating the entire Southern California real estate market as one market.
The county matters. The city matters. And sometimes even the neighborhood, property type or price range can tell a completely different story.
Is Southern California Moving Toward a Balanced Housing Market?
In some areas, yes.
Los Angeles and Orange Counties continued to lean more toward seller-market conditions based on available housing supply. Riverside and San Bernardino Counties were closer to neutral or balanced conditions.
- Buyers are still touring homes
- Buyers are becoming more selective
- Fewer new listings entered the market
- Pending sales slowed
- Sellers negotiated more
- Price reductions became more noticeable
- Some markets are moving closer toward balance
So, is the Southern California housing market slowing down?
Yes — but slowing down doesn’t mean stopping.
It means buyers are becoming more deliberate, sellers may need to adjust their expectations, and strategy matters more on both sides of the transaction.
What This Means for Buyers
A slower market can create opportunities.
- Watch homes that have been sitting on the market
- Pay attention to recent price reductions
- Look for properties where sellers may be flexible
- Consider asking for credits or concessions when appropriate
- Don’t assume you have to rush simply because inventory is limited
What This Means for Sellers
Buyers haven’t disappeared, but they are paying attention.
That makes your pricing strategy, presentation and marketing especially important in a more selective market.
If buyers consistently view your property but don’t make offers, the market may be giving you information about:
- Price
- Condition
- Competition
- Presentation
- Buyer expectations
The goal isn’t simply to put a home on the market. It’s to position the property so today’s buyers clearly see the value.
Thinking About Buying or Selling in Southern California?
Every city, neighborhood and price range behaves a little differently. If you’d like to see what’s happening where you’re considering buying or selling, start with one of these resources.
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