San Mateo Real Estate Market Forecast 2023

San Mateo Real Estate Market Forecast 2023

  • Carly Seiff
  • 07/21/23
Located 20 miles south of San Francisco, San Mateo is one of California’s most beautiful and popular cities. San Mateo is known for encompassing the northernmost part of Silicon Valley, serving as the headquarters for the bioscience, technology and computer software, healthcare, education, transportation, and hospitality industries across the United States. Its thriving economy and prosperous community lend to its popularity, attracting real estate seekers across the state and nationwide.

Any would-be buyer or seller interested in San Mateo real estate should apprise themselves of the current market before they begin. According to the latest data from the California Association of Realtors, the San Mateo housing market is undergoing a slow but steady recovery after months of declining home sales across the country. The drop in home sales is a direct result of rising interest rates, but as these rates and inflation start to cool down, buyers will soon return to the market. Here is everything you need to know about the current housing market in San Mateo.

Rising interest rates put pressure on the number of home sales

Last year, the interest rate in San Mateo was 4.98%, but it has since then increased to a minimum of 7% with some fluctuation. These rising interest rates have deterred buyers from buying new properties, leading to a sharp decline in home sales by about 43.5% year-to-date.

The rise in interest rates, however, is expected to end soon. Compare March’s interest rate of 6.54% with April’s interest rate of 6.34%. Although the difference is small, it bodes well for the market as a whole. Even the slightest decrease in interest rates offers a much-needed reprieve to buyers hoping to find a home.

Slow but steady recovery and buyer rebound

Housing inventory has dwindled nationwide, but every market has a different reason. In California’s case, homeowners have been reluctant to list their homes for sale as a result of buyers turning away from the market (which is a consequence of high interest rates).

The San Mateo housing market alone has seen a 20% decrease in housing inventory year-to-year, but this may soon change. On average, there are 24 active home listings in San Mateo per month, which is a positive 4.4% increase from the previous year. The median home price has also decreased by 20.9% from the previous year, paving the path for buyer rebound and a healthier market in the coming months.

The market’s recovery is steady, and experts are hopeful for the rest of the major housing season. This year may very well be the reprieve that everyone needs after a particularly intense market in 2021 and 2022.

A San Mateo real estate market snapshot

No matter where you look, market prices vary by city. Based on data from May 2023 by the California Association of Realtors, here is what you can expect a San Mateo home to sell for, depending on the size and number of bedrooms.
  • The median price for a one-bedroom home in San Mateo is $329,000. As of May 2023, only 15 listings for one-bedroom homes are available.

  • A two-bedroom home in San Mateo sells for an average of $988,000 per unit. There are about 41 listings for two-bedrooms homes available.

  • On average, a three-bedroom home doubles in price to $1,560,000, with only 14 listings available as of May 2023.

  • Four-bedroom homes are highly coveted in the area, with a median price of $2,450,000. These homes are even more limited in supply; there are only 14 four-bedroom homes for sale in San Mateo.

The cost of living in San Mateo

Spanning the northern portion of Silicon Valley, San Mateo is a wealthy city with a thriving economy and job market. The cost of living in San Mateo is 84% higher than the national average as a result of the city’s prosperity, but it’s important to note that the average household income is approximately $133,612. Residents enjoy a high quality of life and access to some of the nation’s leading healthcare and other services.

What should we take from this?

Based on the data mentioned above, the San Mateo real estate market will continue to recover from a decline in home sales until it balances out. The market will likely teeter toward a neutral stance, favoring neither buyer nor seller, as sellers refrain from raising their prices in an effort to attract as many buyers as possible and achieve faster sales. On the buyer’s end, the continued limited housing supply will lead to some competition, but not enough to drastically raise prices as before. Buyers will also benefit from the slowly rising inventory, giving them more choices when it comes to finding the perfect new property.

Everything must balance out eventually as the real estate market regains a sense of normalcy. Buyers, sellers, and investors should consider entering the market soon rather than hesitating and waiting for the perfect moment. These upcoming months will present the prime opportunity for homes to sell quickly and for the best value, especially as families gear up to move before the start of the next academic year. Whether you’re buying or selling a property, you want to team up with an expert agent who can provide exceptional insight into the San Mateo real estate scene and guide you toward your goals.

Partner up with Carly Seiff

When you’re ready to get started in the San Mateo real estate game, it’s time to get in contact with a local professional. You need a true expert on your side – and there is no better candidate for the role than Carly Seiff, an award-winning Realtor who has consistently ranked among the top 10% of San Mateo County Realtors. Whether you’re buying, selling, or simply interested to learn more about the market, Carly is the perfect agent for the job. Reach out to her today!

*Header photo courtesy of Shutterstock

Work With Carly

Through innovative technology, unique buyer and seller programs, a modern approach to design, and a nationwide network, working with Carly Seiff at Compass is always a seamless experience.