CA homes for $199K? Where to find low prices as Iran war creates ‘uncertainty’
Rising tensions in the Middle East are pushing up gas prices and could soon drive higher grocery costs nationwide.
Now, those ripple effects are beginning to reach California’s housing market, according to real estate experts.
“The conflict in the Middle East is creating some uncertainty for the broader economy and financial markets, which could lead to some short-term hesitation in the housing market,” Tamara Suminski, California Association of Realtors president, said in a Tuesday, March 17, housing report.
The housing market picked back up in February, with both home sales and prices rising steadily, according to the Realtors group’s latest home sales and price report.
Existing home sales reached a seasonally adjusted annual rate of 274,820 in February.
That’s up 7% from January, when 256,550 existing homes were sold in California, but 0.3% lower than the 275,600 homes sold in February 2025.
However, Suminski said, the war in Iran could have negative effects on real estate prices, mortgage rates and home sales in the near future.
“We remain hopeful though that the situation will stabilize in the weeks ahead, allowing market fundamentals and buyer and seller confidence to reassert themselves,” Suminski said.
Here’s what to know about current mortgage rates, average home prices and where to find the lowest-priced properties:
What are current home prices in California?
According to the California Association of Realtors’ February homes sales and price report, the statewide median home price in February was $830,370.
That is about a 1% increase from $822,630 in January, and up from $829,060 this time in 2025.
“While prices are expected to climb as the market approaches the spring homebuying season, lingering concerns about the broader economy and the market condition could constrain the pace of price gains in the months ahead,” the Realtors group said.
Mortgage rates rise in California
As of Friday, March 20, the average 30-year fixed mortgage rate in California was about 6.38%, according to Zillow.
“While mortgage rates remain below year-ago levels, they recently jumped to their highest level in seven months and could temper buyer momentum as we head into the spring homebuying season,” said Jordan Levine, California Association of Realtors senior vice president and chief economist.
Mortgage rates have increased 0.5% from February’s 5.88%, according to previous data.
Although the California Association of Realtors previously forecast rates to stay below 6% in 2026, recent global events have changed that outlook.
Real estate experts said mortgage rates have climbed once again due to “escalating geopolitical instability and renewed inflation fears,” driven by the ongoing war in Iran.
“However, many homeowners remain locked in to historically low rates, and inventory remains tight, so any stabilization in rates could help bolster home prices in the spring market despite ongoing affordability and economic challenges,” Levine said.
Where can I find lowest home prices in California?
The most affordable homes in the state can primarily be found in Northern California, according to the latest report from the California Association of Realtors.
Based on the February 2026 home sales and price report released March 17, these 10 counties had median home prices below the statewide average of $830,370:
- Lassen County — $199,000
- Siskiyou County — $285,000
- Tehama County — $323,630
- Del Norte County — $335,000
- Lake County — $338,950
- Kings County — $356,990
- Tuolumne County — $362,500
- Glenn County — $370,000
- Trinity County — $374,250
- Tulare County — $381,000
Where do homes cost the most in California?
The Bay Area continues to be the most expensive region to buy a home in California.
In February, the median price for a single-family home in the region reached $1,285,000.
The five counties with the highest median prices for existing single-family homes were:
- San Mateo County — $2,250,000
- Santa Clara County — $2,016,000
- San Francisco County — $1,976,000
- Marin County — $1,575,000
- Orange County — $1,432,500
How much do homes cost in my California county?
Find the full list of home prices by county on the California Association of Realtors website.
