California is the most expensive major housing market in the United States, but it is not one market. Prices differ by a factor of three or more between the Bay Area and the Central Valley, and the state’s property tax system, wildfire-driven insurance market, and competitive buying environment add layers that out-of-state buyers rarely expect. This guide covers the state’s main regions, what ownership actually costs, and the questions worth asking before you buy.
Last updated: September 2026.
California Housing Market Overview
The Zillow Home Value Index put California’s typical home value at about $773,735 as of July 2026, essentially flat year over year, with a statewide median sale price near $754,000. The California Association of Realtors reported an existing single-family median price of $887,680 in July 2026, down from a record $930,260 in May 2026. These figures measure different things — ZHVI values the typical home across the whole housing stock, while the Realtors’ series counts only existing single-family resales — which is why they differ. All are point-in-time estimates as of mid-2026.
Where Are Homes Most Expensive?
County-level typical home values from the Zillow Home Value Index (ZHVI) illustrate the spread. All figures are dated mid-2026 and should be confirmed with current listings before you rely on them.
Bay Area
The San Francisco–Oakland–Berkeley metro had a typical home value of about $1,149,215 in mid-2026. San Francisco County was near $1,394,147, and Santa Clara County (San Jose) around $1,652,163, with industry reporting placing San Jose among the most expensive major metros in the nation. Even rapidly cooling pockets of the Bay Area remain far above the statewide average because of high land values and rebuild costs.
Los Angeles
Los Angeles County’s typical home value was about $888,357 in mid-2026 (roughly flat year over year), with the median price paid at closing near $940,000. The wider Los Angeles–Long Beach–Anaheim metro came in at about $968,608. Prices vary widely within the county — from high-rise and luxury product to older suburbs that remain relatively “attainable” by Southern California standards.
San Diego
San Diego County’s typical home value was about $946,356 in mid-2026, down roughly 1.1% from a year earlier. San Diego has historically been the least volatile of the big coastal counties, with steady demand from the military, biomedical, and tech sectors keeping values high and inventory tight.
Orange County
Orange County was one of the most expensive counties in the state, with a typical home value near $1,197,200 in mid-2026 (up about 1.2% year over year) and a median sale price around $1,260,000. Beach cities and coastal communities command the highest prices, while inland cities like Anaheim and Santa Ana sit lower within the county.
More Affordable California Housing Markets
California’s affordability comes from its inland and valley counties, where prices are often one-third to one-half of coastal levels.
Inland Empire
The Riverside–San Bernardino–Ontario metro had a typical home value of about $585,378 in mid-2026, with Riverside County at roughly $608,810 and San Bernardino County at about $552,558. The Inland Empire has absorbed coastal and Bay Area residents for decades; Riverside’s median sale price was around $656,000 as of July 2026, up about 1.7% year over year.
Central Valley
The Central Valley is California’s most affordable large region. Fresno County’s typical home value was about $409,749 and Kern County’s about $364,263 in mid-2026; Fresno’s median sale price was $425,000 in July 2026. Bakersfield, Merced, Modesto, and Stockton all post median prices well below the statewide figure. The trade-off is lower home prices combined with hotter summers, longer commutes, and fewer high-wage employers.
Sacramento Region
The Sacramento–Roseville–Folsom metro had a typical home value of about $582,707 in mid-2026, with Sacramento County near $531,727. Sacramento offers government-sector job stability and a middle position between coastal prices and Central Valley heat, which has made it a consistent draw for buyers leaving more expensive metros.
Property Taxes and Proposition 13
California’s property tax system is structured very differently from most states, and it pays to understand it before buying:
- The base rate is about 1%. Under Proposition 13, the general property tax rate is 1% of assessed value, plus anything needed to fund local voter-approved bonds. That is below the U.S. average effective rate, but assessed value — not market value — is what gets taxed.
- Reassessment happens on change of ownership. Proposition 13 (approved 1978) set the base year value of a property at its market value when it changes ownership or when new construction is completed. A home purchased today is assessed near today’s market price, not at what the seller paid decades ago.
- Annual growth is capped at 2%. For most properties, assessed value rises no more than 2% per year. The steady owner benefits from years of sub-market assessments; the new buyer starts the clock at purchase price.
- Homeowners’ Exemption. A $7,000 reduction in assessed value applies to a qualifying owner-occupied principal residence, lowering taxes modestly for that year onward.
Source: California State Board of Equalization and county assessor materials describing Proposition 13 and the Homeowners’ Exemption. Because many counties also add voter-approved bond assessments and special charges, run a property’s address through the county assessor’s tax calculator rather than assuming a flat 1% bill.
Homeowners Insurance and Wildfire Risk
California’s average homeowners insurance premium is actually below the national average (commonly estimated around $1,300–$1,500 per year versus roughly $2,000–$2,500 nationally in 2026 data), but that statewide average hides a severe affordability and availability problem in wildfire-prone areas:
- Premiums have climbed sharply. Stanford research published in 2026 found average California home insurance premiums rose about 84% between the end of 2020 and March 2026, with average deductibles up from roughly $1,800 to $2,550.
- Several major carriers have cut back. Reports from the California Department of Insurance and industry press indicate that by 2022 seven of the 12 largest home insurers had reduced or paused new underwriting in the state, largely because of wildfire risk. More carriers have since returned to the market as regulations evolved.
- The FAIR Plan is the backstop. The California FAIR Plan is the state-mandated insurer of last resort. It covers roughly 5% of single-family homes as of early 2026 (up from about 1.5% in 2020) and roughly 6% of new single-family mortgages. It covers largely fire, smoke, lightning, and in-home explosions, with lower liability limits than a standard policy — most policyholders buy a supplemental “difference in conditions” policy. FAIR Plan data cited by the San Francisco Chronicle placed the average FAIR Plan premium at just over $3,000 per year as of September 2025, with a wide range by ZIP code and fire risk.
- Location drives the price. Homes in or near Fire Hazard Severity Zones and the wildland-urban interface see the highest premiums and the most non-renewals, while dense urban areas typically keep lower rates and more private options.
Before making an offer, check the property’s Fire Hazard Severity Zone designation (publicly available through the California Department of Forestry and Fire Protection/CalFire) and request insurance quotes at your coverage amount from multiple carriers — plus a FAIR Plan quote if you’re in a high-risk area.
Mortgage and Closing Costs
Freddie Mac’s Primary Mortgage Market Survey averaged 6.71% for a 30-year fixed-rate mortgage the week of September 3, 2026, and 6.95% for the week of September 17, 2026 — so rates are moving and you should check current quotes. Two California specifics affect the borrowing math:
- High purchase prices mean high dollar costs. Even at average percentage-based closing costs, a large loan produces a large dollar amount of lender fees, title fees, and escrow charges. Get a written Loan Estimate from your lender before signing.
- Jumbo loans are common. Because conforming loan limits can be exceeded by high prices in many metros, more California buyers use jumbo mortgages, which can carry slightly higher rates and stricter underwriting.
California is generally a low-closing-cost state in percentage terms on a national basis, but at a $1 million purchase price even a small percentage is a large dollar figure — itemize every fee on the Loan Estimate rather than relying on a rule of thumb.
First-Time Buyer Programs
The California Housing Finance Agency (CalHFA) offers programs for eligible first-time buyers, including down payment and closing cost assistance. Terms, income limits, and property-price caps change, so verify current eligibility and program rules on the CalHFA website before building a plan around them. Many counties and cities also operate their own down payment assistance programs.
How to Compare California Counties
Adjacent California counties can differ by hundreds of thousands of dollars in typical value and by materially different insurance and tax situations. Compare markets on the same four measures, using the same data month for each:
- Typical home value (ZHVI) and median sale price.
- Property tax estimate at your price point, from the county assessor (remember: assessed at purchase, not at the seller’s old base).
- Insurance availability and cost — whether private carriers write new policies in the area, plus Fire Hazard Severity Zone and FAIR Plan exposure.
- Down payment assistance — county or city programs you may qualify for.
Buyer Checklist
- Get pre-approved before shopping; competitive markets move fast.
- Confirm the property’s Fire Hazard Severity Zone and get insurance quotes before the offer, not after.
- Run the address through the county assessor for a first-year property tax estimate based on purchase price.
- Understand Prop 13: your assessed value starts near what you pay, then grows ≤2% a year.
- Review HOAs and special assessments in planned communities and condos.
- Read the seller’s disclosures on past claims, fire history, and neighborhood conditions.
Frequently Asked Questions
Is California more expensive than other states?
Yes, on home prices: Zillow’s typical California home value was about $773,735 in July 2026, roughly double the national typical value, and the California Association of Realtors put the existing single-family median at $887,680 in July 2026. But the state’s full picture is mixed — insurance is comparatively low on average, and property taxes are structured differently than in many markets.
How does Proposition 13 affect new buyers?
Proposition 13 caps the general property tax rate at about 1% of assessed value and limits annual assessment growth to 2%, but a change of ownership triggers reassessment to current market value. In practice, a new buyer’s first tax bill is based on the price they paid, not the seller’s older, lower assessment.
Can I get homeowners insurance in wildfire areas?
Often, but it costs more and may require extra steps. Many areas have private carriers available; some homes rely on the California FAIR Plan (average premium just over $3,000 per year as of September 2025) plus a supplemental policy. Check the property’s Fire Hazard Severity Zone and get quotes before making an offer.
What is the most affordable part of California?
Generally the Central Valley (Fresno County typical value ~$409,749, Kern County ~$364,263 in mid-2026) and parts of the Inland Empire (San Bernardino County ~$552,558). Prices there are significantly below coastal metros but still above many other states, and higher heat and lower job density offset some of the savings.
Sources
- Zillow Home Value Index (ZHVI) — California and county typical home values, mid-2026 data. Viewed September 2026.
- California Association of Realtors — existing single-family median price, July–May 2026.
- California State Board of Equalization — Proposition 13 rate, assessment, reassessment, and 2% cap explanations; Homeowners’ Exemption.
- Freddie Mac Primary Mortgage Market Survey — 30-year fixed-rate averages (6.66%–6.95% during August–September 2026). Viewed September 2026.
- California Department of Insurance and industry press — insurance market, rate filings, and FAIR Plan context (2024–2026).
- Newspaper/industry reporting citing California FAIR Plan data — average FAIR Plan premium and coverage scope, September 2025.
- Stanford Climate and Energy Policy Program (2026) — premium growth and FAIR Plan share analysis.
- California Housing Finance Agency (CalHFA) — first-time buyer and down payment assistance programs.