SEPTEMBER 2026 MARKET WATCH
The Fletcher Real Estate Team | Red Oak Realty

Last month we introduced a framework for understanding what's happening across the East Bay: a K-shaped real estate economy. Two markets moving in opposite directions, and a third caught in between.

September's data sharpens that picture considerably.

The Competitive Market is moving faster

Berkeley, Lafayette, and Pleasant Hill are the upper arm of the K, and the story in September is speed. Berkeley homes averaged just 17.7 days on market, down 22% from August and essentially flat year over year. Sixty-one homes sold in September versus 43 in the same month last year, a 42% jump in transaction volume at nearly identical prices ($1.74M average sale price, unchanged YoY). Supply came to market: 101 new listings in Berkeley, up slightly from last September. The inventory is there, buyers are moving quickly, and prices are holding.

Lafayette followed a similar script. DOM of 26.5 days, almost exactly where it was a year ago. Sales volume up 20% YoY. The average sale price is down 11% from last September's $2.19M to $1.94M this year, though that's largely a composition effect: last September included some outsized luxury transactions. The pace and absorption rate tell the real story, and both point to a healthy market.

Pleasant Hill may be the headline of the competitive tier this month. DOM dropped 33% year over year, from 34.8 days to 23.3. Sales volume jumped 41%. The average sale price is down 5% to $956K, but homes are moving significantly faster than they were twelve months ago. Buyers who came close in past seasons and lost out are finding traction here.

The Measured Market: holding, with one notable exception

Oakland, Benicia, and Vallejo occupy the middle of the K. Each is telling a different story.

Oakland is actually improving on a year-over-year basis. The average sale price is up 6% to $961K. DOM dropped 24%, from 43 days last September to 33 days this month. The city listed 17% fewer homes than a year ago, which is keeping inventory tight and supporting prices. Buyers are adjusting expectations and finding value.

Vallejo is stable. Average sale price came in at $501K, down 7% YoY, with DOM also down 10% to 42.1 days. Transaction volume is flat. This is a market in equilibrium: not accelerating, not softening, just steady.

Benicia is where the data gets interesting.

The headline number: average DOM of 79.2 days, up 61% from 49.1 days a year ago, and up 73% from just last month. That is a significant signal. But the number obscures what's really happening, and we think it's important to explain the breakdown.

When you separate Benicia's September sales by property type, two very different markets emerge. Detached single-family homes averaged $951,862 at 59.6 days on market. Condos averaged $437,035 at 107.7 days on market.

The detached market in Benicia is holding up. Prices are up from last August's $907,561 average. The condo market is the source of the distortion.

Here's why: condos are typically the tertiary housing type in any market. They're often the first to show signs of softening when conditions shift, and the last to benefit when a market starts heating up. This pattern is well-documented in the East Bay, and Benicia is demonstrating it right now.

But there's a more specific catalyst at work. On August 3, 2026, Fannie Mae retired its Limited Review process for condo loans. Before that date, many condo purchases could sail through underwriting without lenders scrutinizing HOA financials, reserve funding levels, delinquency rates, or insurance documentation. That lighter-touch process is now gone. Every conventional condo loan requires a Full Review of the homeowners association.

For older Benicia condo complexes — many of which were built in the late 1970s and 1980s — this creates real friction. Underfunded reserves, deferred maintenance, thin documentation: any of these can cause a Full Review to stall or fail. When a project fails review, it becomes non-warrantable, meaning conventional financing is unavailable. That instantly shrinks the buyer pool to cash or non-QM loan buyers, which dramatically slows absorption and extends days on market.

The 107-day average DOM in Benicia condos reflects deals falling through, relisting, and buyers facing financing hurdles they didn't anticipate before August. This isn't a story about the Benicia market as a whole. It's a very specific story about a regulatory change landing hard on a specific property type in a city where that type represents a meaningful share of transactions.

We've written a deeper guide to these new condo lending rules for buyers and sellers who want to understand what's changed and how to navigate it. New HOA Lending Rules — What East Bay Condo Buyers and Sellers Need to Know

The Drift Market: higher volume, slower pace

Richmond and Martinez are the lower arm of the K. Homes are moving, but time on market is ticking up in both cities.

Richmond saw a strong month for volume: 58 homes sold in September, up 38% from August. Average sale price held steady at $627K, up 3% year over year. But DOM climbed to 44.8 days, up 17% from last September and up 8% from August. More transactions happening, but the average home is sitting longer. Richmond continues to attract buyers who've been priced out of the competitive tier, but those buyers are taking their time.

Martinez is navigating a broader cooldown. Average sale price dropped 15% year over year to $751K, with DOM up 15% to 40.6 days. New listings are down 17% from last September, which is compressing supply, but sales volume is also down. The market isn't in freefall: 37 homes sold in September. But Martinez is experiencing the kind of recalibration that's typical when rate sensitivity is high and buyers have options across multiple cities.

The Solano County picture

At the county level, Solano is feeling the most pressure. Average sale price is down 7% year over year to $591K, with DOM up 6% to 53.5 days. Both Benicia and Vallejo contribute to this picture, and the Benicia condo dynamic is pulling the DOM figure higher than the underlying detached market would suggest.

Contra Costa County is essentially flat YoY: average sale price down just 1% to $1.02M, DOM up 2%. Sales volume declined 14%, which reflects the broader dynamic of fewer motivated sellers and buyers exercising more patience.

Alameda County is the bright spot. Average sale price is up 5% year over year to $1.25M. DOM is down 11% to 29.7 days. Oakland's improving performance and Berkeley's sustained competitiveness are carrying the county numbers.

A note on giving back

Our annual One Warm Coat drive runs from the week of September 28th through the week before Thanksgiving. We're collecting coats for donation to two organizations doing essential work in our community: White Pony Express in Walnut Creek, and Dorothy Day House in Berkeley. If you have a gently used coat to spare, we'd love to help it find someone who needs it this winter. Drop us a line and we'll get you the details.

Bottom line

The K-shaped market is clarifying, not correcting. The competitive tier is absorbing inventory quickly and prices are holding. The measured tier is split: Oakland is strengthening, Vallejo is steady, and Benicia's condo segment is navigating a specific regulatory headwind. The drift market is moving more volume but slower. None of this is panic territory. All of it is information you can use.

If you're thinking about buying, selling, or just trying to make sense of what the data means for a specific property or neighborhood, we're here. That's what we do.

Warmly,
Bill and Eli

P.S. If you own a condo or are thinking about buying one anywhere in the East Bay, the August 3rd rule change is worth understanding before you list or make an offer. Reply to this email and we'll walk you through exactly how it affects your situation.

Bill Fletcher | DRE #01724665
Eli Fletcher | DRE #01933235
Red Oak Realty | ezfletcher.com