15 California Cities Where Home Prices Are Crashing Right Now (2026)

0:00 Everybody knows California is expensive. That part has not changed. What has changed is the belief that California real estate only goes up. The thing people have trusted for 40 years. In a growing list of cities, that idea is quietly falling apart right now in 2026. Not everywhere. Most of the state is still climbing and still setting records. But underneath that headline number, there are places where the opposite is happening. Sellers are cutting their price two and three times.

0:31 Homes are sitting for two and three months with no offers. Buyers have simply walked away. And the people who bought at the top are watching their equity disappear while they still owe the bank. Today, we are counting down 15 California cities where home prices are falling the fastest in 2026. If you own a home in any of these places, you need to watch this. If you're about to buy, you really need to watch this. Let us get into it.

1:01 We are starting with the biggest name on the whole list, Los Angeles. And let me be honest with you right away, Los Angeles is not crashing. This is the mildest case on this entire countdown. And that is exactly why it sits at number 15. But something is happening here that nobody expected. Over the 3 months ending this spring, the median home price in Los Angeles slipped about 2% from a year earlier, sitting right around $1 million. 2% does not sound like much, but on a million-doll home, that is $20,000 in value, gone in a market that for decades only ever went up. The bigger story is underneath that number. Homes are sitting longer, now around 50 days to sell, and fewer of them are actually closing. The softness is concentrated in two places. The condo market is weak with downtown and mid-tier units sitting while buyers wait, and the luxury end has cooled as high earners turn cautious. Add mortgage rates stuck above 6 12% and insurance premiums that have climbed hard in the hillside and fire zones, and the math buyers used to stretch for simply stopped working. Red Fin has called 2026 a great housing reset and Los Angeles is a textbook example. This is not a collapse. It is a market that finally ran out of buyers willing to pay any price. And that is exactly how every correction starts. When the biggest and most desirable market in the state begins to soften, it is worth paying attention to what comes next.

2:38 Number 14 takes us into the high desert to Victorville about 90 minutes north of Los Angeles up the 15 freeway. And Victorville is a perfect example of the quiet kind of decline, the kind that does not show up in the headline price. On paper, the median sale price in Victorville is basically flat, sitting around $427,000. So you might think nothing is wrong. But look closer. The price per square foot in Victorville is down almost 10% from a year ago. That gap tells you people are still buying, but they are buying smaller or paying a lot less for the same space. And here is the number that really matters. Roughly one in three homes listed in Victorville has had a price cut. More than 30% of sellers put their home on the market, waited, got nothing, and had to drop the price.

3:28 Victorville was built on a simple promise. It was the place where families priced out of Los Angeles could finally afford a house with a yard as long as they were willing to make the long commute. For years, that worked. But when mortgage rates climbed above 6 1/2%, that affordable payment was not affordable anymore. The buyers who were stretching to get here stopped coming. Inventory built up. Homes started sitting for 7 and 8 weeks. And the sellers who bought during the boom are now competing with each other for the few buyers who are left. Victor Bill is not collapsing, but the easy money days are over and the sellers know it. Quick break. If you are enjoying watching home prices fall as much as I enjoy reporting it, hit that subscribe button. It is free, which right now makes it the best deal in California real estate. And unlike the houses on this list, subscribing only goes up in value. Back to the countdown.

4:23 At number 13, we have San Bernardino, the heart of the Inland Empire. And this one comes with an honest caveat because San Bernardino is a mixed picture, which is exactly why it sits this low on the list. Across San Bernardino County as a whole, the median sale price is down about 3% from a year ago, sitting around $535,000. The price per square foot has fallen a similar amount, and the number of homes actually selling has dropped. for one of the only large counties in Southern California to be sliding while the rest of the state sets records. That is worth paying attention to. San Bernardino spent decades as the affordable answer to Los Angeles and Orange County. When the coast got too expensive, people moved inland and the Inland Empire boomed. But the same forces squeezing everyone else hit here harder. Mortgage payments jumped with rates above 6 1/2%.

5:16 Insurance costs have climbed sharply in the foothill and wildfire zones that ring the county. And wages here never came close to keeping up with how fast prices ran during the boom. Jake Krimmel, a senior economist at realtor.com, has pointed to exactly this combination. Rising insurance and rising taxes as the pressure quietly pushing markets like this one lower. The result is more inventory, longer waits, and buyers who finally have room to negotiate. San Bernardino is not crashing, but it is one of the clearest signs that even the Inland Empire, the place that was supposed to stay affordable forever, has hit its ceiling.

5:55 Number 12 brings us to the desert, to Palm Desert, one of the crown jewels of the Coachella Valley and a longtime favorite for retirees and snowbirds. And the desert is where this list starts to get interesting because the resort markets are cooling in a way they have not in years. The typical home value in Palm Desert is down close to 3% over the past year, sitting in the mid 500s. That alone is mild, but the better tell is time. Homes in Palm Desert are now taking around 77 days to sell, well over 2 months, and the local desert housing report has officially flipped this into a buyer market. For a place that lives and dies on seasonal buyers, that is a real shift. Palm Desert is built around second homes, golf communities, and retirees coming down for the winter.

6:43 That makes it unusually sensitive to two things: interest rates, and confidence. When borrowing costs are high, a second home is the first purchase people delay. And when the stock market wobbles or the economy feels shaky, the discretionary buyer simply waits. On top of that, homeowner association dues and insurance premiums across the valley have climbed, adding hundreds of dollars a month to the cost of owning here. So sellers who expected the usual winter feeding frenzy are instead watching their listings sit.

7:14 The wealth in Palm Desert is real and it is deep. So do not expect a collapse here. But the days of naming your price and getting it before the snow melts up north are gone. And that is the first crack in the desert. Now I have to ask, is your city on this list or are you sitting there nervously waiting to find out? Tell me in the comments where you are and what you are seeing. Honestly, this comment section reads to market better than half the experts on television and I read every single one.

7:40 Let us keep going. Number 11 is our first stop in the San Francisco Bay area and it tells a story of two completely different worlds. The flashy parts of the Bay, San Francisco proper and the peninsula are actually booming again in 2026. But drive inland to the East Bay to a city like Concord and the picture flips. Concord sits in central Contraosta County about 30 mi east of San Francisco. And for years it was the affordable middleclass alternative for people who worked in the Bay but could not dream of paying San Francisco prices. That market has gone cold. Across the broader East Bay, prices are down about 2 1.5% from a year ago. And when you look only at existing single family homes in Contraosta County, the median is down closer to 6%.

8:32 But the scariest number here is not the price, it is the silence. Home sales in Concord have dropped almost 13% compared to last year. Fewer people are buying. Full stop. And from February to March alone, right when the spring season should have been heating up, the average price in Concord fell more than 8% instead of rising. Part of this is the remote work hangover. The commuters who fled the Concord for space during the pandemic got called back or moved on and the demand they created went with them.

9:04 When buyers disappear like this, prices do not crash overnight. They bleed slowly, month after month, as sellers slowly accept that the offer they were dreaming of is not coming. Concord is not in freefall, but in a Bay Area that is supposedly red-hot, it is quietly going the other way. Number 10 brings us back to the desert, but to a very different kind of desert town. Desert Hot Springs sits just north of Palm Springs, and it has always been the affordable one, the place where regular people could buy into the Coachella Valley without a millionaire's budget. And here is where I have to be straight with you, because the headline number for Desert Hot Springs is almost flat, down less than 1% for the typical home. So, why is it on this list?

9:51 Because of what is happening underneath in the condo market. The value of an average condominium attached home in Desert Hot Springs has fallen more than 21% in a single year. That is not a typo. One in five dollars of condo value gone. This is the same story playing out all over the desert and frankly all over the sunb belt. Condos got overbuilt during the boom. Then homeowner association dues climbed, insurance premiums climbed, and special assessments started landing in mailboxes. Suddenly, that cheap desert condo was not cheap at all once you added up the monthly carrying costs.

10:27 Buyers did the math and walked. And because Desert Hot Springs is the most affordable corner of the valley, it attracted the most price sensitive buyers, the exact people who get squeezed out first when costs rise. So, you have a town where single family homes are holding, but the condo market has quietly collapsed. If you own a condo in the desert, this is the number that should keep you up at night. Desert Hot Springs is the warning label for what high fees can do to a cheap looking property. One more thing before the heavy hitters. If you want to catch the moment your city starts flashing these same warning signs, tap the notification bell. That way you hear it from me, not from the neighbor who just cut his price for the third time. It is the only alarm in real estate that costs you nothing.

11:11 The countdown continues. At number nine, we are back in the Inland Empire in Moreno Valley, a city of about 210,000 people east of Riverside. Moreno Valley exploded over the last decade on the back of one industry, logistics. Massive warehouses and distribution centers went up everywhere. Jobs followed and entry-level buyers poured in chasing the cheapest new houses within reach of those jobs. Now the music has stopped. The median home price in Moreno Valley is down about 3% from a year ago, sitting around $556,000.

11:47 But the number that tells the real story is the price cuts. Roughly 1 in three homes listed for sale in Moreno Valley has had its asking price reduced. Think about that. More than 30% of sellers came to market, sat there, and had to lower their number to get any attention at all. Weno Valley was always a firsttime buyer market and first-time buyers are the most sensitive group of all to interest rates. When rates pushed past 6 12%, the monthly payment on a starter home here jumped by hundreds of dollars and the young families who were the engine of this market simply could not qualify anymore. So, inventory is piling up. Homes are taking well over 2 months to sell. And the sellers, many of whom bought near the peak with very little equity, are now cutting prices into a market with fewer and fewer buyers. Moreno Valley is not a disaster.

12:39 But when a third of your sellers are slashing prices, the direction is not up. Number eight is Lancaster. Out in the high desert of the Antelopee Valley, about 70 mi north of Los Angeles, Lancaster is a textbook case of a market that got overbuilt and is now paying for it. During the boom, builders threw up new subdivisions across the valley as fast as they could pour foundations, betting that the wave of buyers fleeing Los Angeles prices would never end. The wave ended. Today, the typical home value in Lancaster is down about 4% from a year ago, sitting in the mid 400s. But the clearest sign of trouble is how long homes are taking to sell. Listings in Lancaster are now sitting on the market for well over a 100 days. Compare that to the frenzied markets in the Bay Area where homes sell in 2 weeks and you start to understand just how soft this market has become. When a house sits for a 100 days, the seller has only two choices. Cut the price or pull the listing. And most end up cutting.

13:39 Lancaster sells itself on affordability and space. The promise that for the price of a small condo closer to the city, you can own a real house with a yard out here. But that promise only works when the commute and the mortgage both pencil out. With rates high and gas not cheap, the math got harder and the buyers stand out. The new construction that was supposed to be a sign of growth is now extra competition for sellers trying to move an existing home.

14:06 Lancaster is not collapsing, but it has clearly run out of momentum and the long days on market prove it. Number seven keeps us in the Analopee Valley, right next door to Lancaster in its twin city of Palmdale. And if Lancaster is soft, Palmdale is softer. The median home price in Palmdale has fallen more than 5% in the past year, down to around $512,000. That is one of the steeper drops anywhere on this list. And it is happening in a city that on paper has a solid economy. Palmdale is an aerospace town. Some of the most advanced aircraft in the world are built and tested right here at the local Air Force plant. and that defense work provides thousands of stable, good paying jobs. So, this is not a story about an industry collapsing. This is a story about a payment that stopped making sense.

14:58 Palmdale grew because it was the last place within a long commute of Los Angeles where a working family could buy a brand new house for a price that felt doable. But that whole model depends on two things staying cheap. The mortgage and the drive. When interest rates jumped past six and a half percent, the monthly payment on these homes climbed by hundreds of dollars and the buyers who were already stretching to afford the commute simply could not stretch any further. Demand cooled, listings backed up, and prices started sliding faster than in almost any other suburb in the region. The aerospace jobs are putting a floor under Palmdale, keeping it from falling off a cliff. But a 5% drop in a single year is the market telling you very clearly that the price got ahead of what people out here can actually pay.

15:50 Number six takes us to the central coast to Selenus, the heart of the Monterey County farm belt. They call this region the salad bowl of the world because an enormous share of the lettuce, strawberries, and vegetables grown in America comes out of this valley. And that is exactly what makes Selena so strange and so vulnerable. The median home price in Selenus is around $700,000 and over the past year it has fallen close to 5%. Now think about who actually lives and works here. This is an agricultural economy. The wages that power this valley are farm wages, modest by any measure, while the home prices are pushing toward coastal California levels. That is one of the widest gaps between what homes cost and what local people earn anywhere in the state. For years, that gap was papered over by buyers spilling in from the Bay Area and the Monterey Peninsula, looking for something more affordable than the coast. But with rates high and the broader Bay Area cooling, that overflow of outside buyers slowed to a trickle.

16:51 And once you take those outside buyers away, you are left with local incomes that simply cannot support $700,000 homes. So prices are giving back ground. Homes that would have sold instantly 2 years ago are now negotiable. Selenus is a beautiful, productive place with a real economy behind it. But when a farm town is priced like a beach town, something eventually has to give. And right now, it is the price that is giving. At number five, we head into the central valley to Merrced. And here the numbers get serious. Across Merrced County, the median home price has fallen about 9% over the past year, down to roughly $400,000.

17:32 I want to be precise with you because the city of Merrced itself is holding up better than the county as a whole, down only slightly. But the broader Merrced market, the county that surrounds it, is posting one of the steepest declines of anywhere we have talked about so far. Merrced is the far edge of the Bay Area's reach. It is the cheapest gateway into the valley for people getting priced out of San Jose and the East Bay, the place where you could still find a house in the 300s not long ago. The town also has a university, which usually steadies a market. But none of that was enough. When mortgage rates climbed, Merrced got hit from two directions at once. The local buyers here earned Central Valley wages among the lower incomes in the state. So, higher payments shut them out fast, and the Bay Area buyers who used to drive prices up stopped making the long move inland.

18:20 Take away both groups at the same time and you get exactly what the data shows. A market sliding close to 9% while the rest of California sets records. Homes are sitting longer, sellers are cutting, and the equity that built up during the boom is quietly eroding. Merrcett is the moment this list stops being about gentle cooling and starts being about the real declines. The top of this countdown is where the genuine pain lives. Number four is the most famous name in the desert, Palm Springs. The glamorous one, the mid-century playground. The place celebrities have escaped to for 70 years. And in 2026, Palm Springs has officially flipped into a buyer market for the first time in a long time. Now, I am going to be honest about the numbers because they are messy.

19:07 Depending on which report you read, the typical detached home in Palm Springs is down anywhere from a couple of percent to more than 8% over the past year with the median sitting somewhere between 1 and $1.2 million. The condo market is clear and it is down about 6%. But the why behind Palm Springs is the most interesting part of this whole list. For years, this market did not run on families or even on retirees. It ran on investors buying vacation rentals.

19:35 People would buy a house here purely to rent it out to tourists by the night. Then the city cracked down, putting strict new limits on how many days a year you can rent a home to short-term visitors. Overnight, the entire investment case for buying in Palm Springs weakened. The Airbnb money that was propping up prices started to dry up. Add in higher mortgage rates and climbing insurance, and the second home buyers who remained got cautious. So now the most desirable resort town in the California desert is sitting in a buyer market with sellers cutting and homes that used to fly off the shelf now waiting for offers. When the glamour capital of the desert turns soft, you know the correction is real.

20:16 At number three, we stay in the Coachella Valley but move to its biggest city, India. You may know the name even if you have never been because this is where the giant Coachella and Stage Coach music festivals happen every spring. India is not a niche resort town. It is the largest, most normal, most everyday city in the valley, which is exactly why what is happening here matters so much. The condo and attached home market in India has fallen more than 10% in the past year. And if you measure from the peak of the boom back in 2022, condo values here are down a full 20%. One out of every $5 of value erased. The single family homes are holding up better. So, this is really a condo story, but it is a severe one. The same forces are at work that we have seen all over the desert. Condos got overbuilt, then homeowner association dues went up, insurance went up, and special assessments started hitting owners with surprise bills worth thousands of dollars. A condo that looked like an affordable way into the sunshine turned into a money pit once you added up the true monthly cost.

21:24 buyers figured that out and stepped back. And because Indo is the entry point for so many firsttime and middle inome buyers in the valley, the pain landed squarely on the most price sensitive people. 20% off the peak is not a wobble. That is a genuine painful correction. And it's happening in the most ordinary city in the desert, not some far-flung outlier. Number two is the one almost nobody outside of Northern California has ever heard of, and it might be the most distressing market in the entire state.

21:58 Clear Lake sits on the shore of Clear Lake, the largest natural lake entirely inside California, about 2 hours north of San Francisco and Lake County. It is also the cheapest real market on this list by far. The typical home in Clear Lake is worth only around $220,000, and even at that low price, it is falling. Zillow has values down about 6 and a.5% over the past year, but the raw price barely captures what is happening here. I want to be straight with you, this is a small market, so the month-to-month numbers swing hard, but the direction is unmistakable. In one recent month, the median home in Clear Lake sold for $195,000.

22:38 A year earlier, that figure was $288,000. Homes are selling for only about 82% of their asking price, meaning the typical seller is accepting almost 20% below what they hope to get. There is over 9 months of unsold inventory sitting on the market, and homes are taking anywhere from 3 to nearly 6 months to sell. So, what broke Clear Lake? Two words: fire and insurance. Lake County has been hammered by wildfire after wildfire over the past decade. And 99% of the properties in the county now carries some wildfire risk. As a result, insurance companies have fled. Getting an affordable policy here has become a nightmare and in some cases impossible.

23:21 And a homie cannot insure is a home almost nobody can buy with a mortgage. That is how you get a frozen market. Clear Lake is what it looks like when the insurance crisis wins. And the number one city in California where home prices are falling the fastest is a major one. A name everyone knows. Oakland. Right across the bay from San Francisco, the third largest city in the Bay Area and the single steepest home price decline of any large city in the entire United States. Let that sink in. Out of every American city with more than a 100,000 people, Oakland is at the very top of the list for losing value, tied only with Cape Coral, Florida. The typical Oakland home has dropped about 11% in just the past year after adjusting for inflation. But the one-year number is not even the scary part. Oakland home values are now roughly 28% below where they were back in 2019. The typical home here peaked at around $1.1 million and has since fallen to about $716,000.

24:31 The last time homes in Oakland were this cheap, was 2015. More than a decade of gains gone. So, what happened to a city this big, this close to all that Silicon Valley money? It is really three things stacked on top of each other. First, remote work. Oakland boomed because it was the slightly cheaper place to live while commuting to San Francisco and the tech campuses. When the office stopped being mandatory, that entire reason to pay a premium evaporated. Second, the downtown collapse. Oakland's downtown and its condo heavy neighborhoods have been hit hardest by far. Offices sit empty, retailers have closed, and concerns about crime and street conditions have made buyers nervous about the urban core. One home near Lake Merritt sold late last year at a loss of about $150,000 because the owner was afraid prices would keep dropping. And third, the math. Even after that huge decline, a mortgage on a mid-priced Oakland home still runs around $3,700 a month with 20% down, which is brutal at today's interest rates. Now, here is the honest nuance. Oakland is really two cities.

25:46 The wealthy hill neighborhoods like Rock Ridge and Teiscll are still competitive, still getting offers. It is the flats, the downtown, and the condos that are in freefall. But when you average it all together, no big city in America has lost more value than Oakland. This is not a gentle cooling or a healthy reset. This is a genuine crash happening right now in one of the most famous cities in California. So, those are 15 California cities where home prices are falling the fastest in 2026. And when you step back, the same three forces show up over and over. First, the math broke. With mortgage rate stuck above 6 1/2%, a payment people could barely manage 2 years ago became impossible. Second, the buyers vanished. The remote workers, the Bay Area overflow, the out of town money that propped up every affordable alternative either slowed down or stopped coming. And third, the cost of simply owning exploded with wildfire insurance tripling or disappearing in whole counties and condo owners buried under special assessments and rising dues. Put those together and you get exactly what you just saw. Real decllorins in real cities while the statewide headline keeps bragging about record prices. Because that is the part nobody tells you. California is not one market. It is dozens of them and a growing number are heading the wrong way. If you are thinking about buying in one of these places, this might be your window. If you are trying to sell, the clock is ticking. Either way, do your homework before you sign anything. If this honest numbers first breakdown is what you came for, subscribe. I cover California every single day. And unlike the homes on this list, this channel is one California asset that only goes up.

27:27 Drop a comment and tell me what your city is doing right now. I read every single one. And if you want every number in one place, I put together a full California retirement guide. 24 cities, all the data, no fluff. And the link is in the description. I will see you in the next