El Dorado Hills median dropped 11% as the market shifted to smaller homes

El Dorado Hills’ median home price fell more than 11% over the past year, according to newly released Redfin data for the three months ending July 2026. But that headline number tells only part of the story: the price buyers paid per square foot actually rose 3% over the same period, a 14-point divergence that suggests the drop reflects a shift toward smaller, less expensive homes rather than a broad decline in property values.

A tale of two price measures

The median sale price in this El Dorado County city of about 51,000 residents came in at $876,561, down from $987,000 a year earlier. On its face, that is a substantial decline. But the median price per square foot climbed to $371 from $360 over the same stretch, meaning buyers paid more for each unit of space even as the typical sale price fell.

The most likely explanation is a change in what sold rather than a broad-based repricing of homes. When smaller or more modestly sized properties make up a larger share of transactions, the median sale price can fall even while per-square-foot values hold or rise. That mix shift appears to be at work here, and it is a reminder that a single headline number can obscure the underlying trend.

Compared with the three months ending June 2026, the median price rose 2.3%, from $857,000 — typical firmness for the summer selling season. Over a longer horizon, prices remain roughly in line with where they stood two years ago, when the median was $975,000, and are down 2.6% from five years ago, when the market was running at a far faster pace.

More homes changing hands

Sales activity picked up notably. A total of 246 homes sold during the three months ending July 2026, up 14.9% from 214 in the same period last year and up 3.4% from the prior three-month period. That figure also sits well above the 182 homes sold two years ago, pointing to healthier demand despite higher prices in absolute terms.

Inventory expanded as well, with 527 active listings, up 10.9% year over year and up 2.9% from the prior period. Even so, the market remains tight. At the current sales pace, there are just 2.1 months of supply — well within sellers’-market territory, where buyers face limited choice. New listings totaled 314, up from 274 a year earlier.

Homes took slightly longer to sell than they did a year ago. The median days on market was 26, up from 24, and up from 22 in the prior three-month period. The pace remains brisk by historical standards — five years ago, homes were selling in a median of just seven days at the height of the pandemic-era frenzy. Some 27.5% of homes sold above their asking price, up slightly from 25.7% a year ago, and the median home sold at 99.2% of list price.

Affordability and borrowing costs

Lower prices and slightly lower borrowing costs have eased the monthly math for buyers. The 30-year fixed mortgage rate averaged 6.54% in July 2026, down from 6.72% a year earlier, according to Freddie Mac. Combined with the year-over-year price decline, that means the monthly principal-and-interest payment on a median-priced home, assuming 20% down, is about $4,451 — roughly $655 less per month than the $5,106 it would have cost a year ago.

Even so, El Dorado Hills remains an expensive market. That payment absorbs about 32.3% of the median household’s monthly income, which the U.S. Census Bureau puts at $165,349. At current prices, a median-priced home costs about 5.3 times the median household income — above the 5x threshold generally considered stretched for affordability, though the local income base is high relative to statewide norms.

Nationally, home prices continued to edge higher, with the S&P/Case-Shiller U.S. National Home Price Index up modestly year over year — a contrast with the softer median price trend in El Dorado Hills, underscoring the local role of the shift in what is selling.

What the numbers show

Taken together, the data describes a market that remains firmly tilted toward sellers, with tight supply, rising sales volume, and homes still moving in under a month. The double-digit drop in the median sale price stands out, but the rise in price per square foot suggests it reflects the type of homes changing hands more than a decline in underlying values.