Rental Demand Fall 2025

Northern California’s housing market in 2026 is expected to experience modest growth, signaling a stabilization after the rapid appreciation seen in previous years. According to the California Association of REALTORS® (C.A.R.), existing single-family home sales are projected to rise slightly, with median home prices increasing at a slower pace. While property values are likely to continue climbing, the gains are expected to be moderate rather than dramatic. For landlords, this means steady long-term value growth, but with less potential for speculative windfalls than in previous boom periods.

Rental demand is projected to remain strong, largely because high home prices and interest rates will keep many potential buyers in the rental market. Prospective homeowners may delay purchasing a property, supporting a consistent pool of tenants for rental units. However, slight improvements in housing inventory could gradually shift some renters into buyers, making it important for landlords to monitor local trends and adapt their leasing strategies accordingly. Maintaining tenant satisfaction through competitive pricing and property upgrades will help ensure long-term occupancy.

Interest rates are another critical factor for landlords in 2026. The average 30-year fixed mortgage rate is expected to moderate slightly, offering potential opportunities for refinancing existing properties. While borrowing costs will still be higher than historical lows, this moderation could improve cash flow and make investments more manageable. Landlords should carefully evaluate financing options to optimize property performance and prepare for any market shifts.

Strategically, landlords should focus on stability and operational efficiency. Call GLC Property Management today (800)927-0288