Home Values Expected To Plummet In These CA Communities: Zillow

CALIFORNIA — Homes are expected to drop in value by more than 5 percent year-over-year in several California markets, according to a recent Zillow forecast.

The real estate website’s April forecast showed a 1.9 percent projected decline in home values overall, paired with an anticipated rise in sales, for 2025.

“The combination of rising available listings and elevated mortgage rates is signaling potential price drops by year’s end,” the forecast said. “With increased supply, buyers are gaining more options and time to decide, while sellers are cutting prices at record levels to attract bids.”

The areas in California that are forecast to be hardest hit by dropping home values as of the end of March 2026 are all in Northern California and include the following metros and projections, according to Zillow:

• Ukiah: -9 percent;
• Eureka: -7.3 percent;
• Clearlake: -5.5 percent;
• Chico: -5.4 percent;
• San Francisco: -5.2 percent;
• Santa Rosa: -5.2 percent.

According to Zillow’s available data, the average home in California is currently valued at $788,920, while in Ukiah the average home is valued at $480,126.