Sacramento-area homes sales plummet. Expert says economic uncertainty drove drop

Home sales in the Sacramento area hit a steep decline in January in a slow start to the year, the California Association of Realtors said.

Sales of existing homes in the four-county area in January fell by about a third compared to December, the association said.

Across California, home sales retreated in January to their lowest level since May 2025 and home prices fell to a 23-month low.

“After closing out 2025 on a strong note, California’s housing market has started the new year on a softer footing, with both sales and prices coming in below last year’s levels,” said Tamara Suminski, president of the association.

“However, as mortgage rates ease toward recent lows and housing supply is expected to improve in the coming weeks, we anticipate momentum to build as the market heads into the spring homebuying season,” Suminski said.

Oscar Wei, deputy chief economist for the organization, said mortgage rate volatility and lingering economic uncertainty contributed to the slowdown.

Here’s what to know:

What do the numbers show?

Home sales in Sacramento County in January plunged 27.8% over December, an 8.8% drop compared to January 2025. Median home sale prices in Sacramento County remained even at $540,000 in January compared to January 2025, the association said.

In Placer County, sales fell 31.6% over December’s numbers. But it increased by 2.8% compared to January 2025, the association said. Median sale prices by 3.8% to $625,000 the same period.

Home sales in El Dorado County dropped by 35.8% in January compared to December — showing a 7.5% decline since January 2025. The county saw median home sale prices rise 14.7% to $705,3308 from $615,000 in the same period.

Sales in Yolo County remained steady since December, with a 10.9% increase compared to January 2025. And median home sale prices fell by 6.8% year-over-year to $559,300 from $600,000.

What do the numbers mean?

“Home sales were down month-over-month and year-over-year partly because of mortgage rate volatility. But lingering economic uncertainty may have played a role as well,” Wei said.

But he said sales and prices should improve as the year moves along.

What do buyers need to know?

Lower interest rates and falling prices present opportunities for potential home buyers, Wei said.

“In addition, an increase in housing supply offers more choices for home buyers,” he said. “Those who are interested in buying and have the financial capability to do so should take advantage of the current market condition and get off the sideline.”

What do sellers need to know?

“Sellers who are interested in putting their houses up on the market need to realize that buyers have more options to choose from compared to a few months ago,” Wei said.

Real estate professionals can help potential sellers adjust to a more balanced market, he said.

What do figures mean for 2026?

Wei said he expects home sales to strengthen in February despite the slow start to 2026.

“With interest rates coming back to three-year low levels in January, we expect closed sales transactions in February — which opened in January — to improve,” he said.

Prices also should rise as the home-buying season kicks off later in the year.

“While interest rates may continue to fluctuate, they will likely remain below last year’s level and could go down before the end of the year,” Wei said. “Housing affordability should improve slightly in the next 12 months, despite a mild increase in home prices in 2026.”

Jordan Levine, the association’s chief economist, said in the release that the economy may be starting to stabilize, which also will boost home sales.

“With pending home sales posting a solid gain last month, we anticipate a rebound in housing market activity in February,” Levine said.

This story was originally published February 24, 2026 at 12:38 PM.