January Market Update

January 2026 Market Update

As expected, inventory levels declined across all Tri-Valley cities over the past month. We are currently at or near the lowest inventory levels we’ll likely see this year, as inventories generally begin to rise in early to mid-February.

Mortgage rates have dropped to levels we haven’t seen in nearly three years. This follows the President’s directive for Fannie Mae and Freddie Mac to purchase approximately $200 billion in mortgage-backed securities. The announcement led to an immediate improvement in rates last week, briefly pushing them below 6%. Currently, the average 30-year fixed mortgage rate is approximately 6.07%, which is about 0.75% lower than it was in January 2025. While it remains to be seen where rates will ultimately settle, many experts are speculating that we could see rates in the 5.5%–5.75% range later in 2026.

Based on the high volume of calls I’ve been receiving from potential sellers, along with the surprisingly strong buyer activity over the past couple of weeks, it appears our busy spring selling season may be starting early this year. I expect to see the level of inventories rise quicker than we normally see in February and early March, and I believe the lower rates will bring more buyers off the sidelines.

The combination of near three-year low mortgage rates, limited inventory, and strong buyer demand makes this a particularly advantageous time to sell a home. Significantly more inventory and competition are expected to come on the market within the next few months, so if you’ve been considering selling in the spring or summer and have the flexibility to move sooner, it may be worth exploring your options now.