Home prices in Davis fell more sharply over the summer than in most nearby cities, with the median sale price down 6.1% from a year earlier, according to newly released data from Redfin. The median home sold for $821,956 in the three months ending August 2026, down from $875,000 during the same period in 2025 — a decline of more than $50,000 even as buyers turned out in greater numbers.

Prices down, buyers up

The year-over-year price drop stands out because it arrived alongside stronger demand rather than weaker. Sales rose 10.2% over the same period, with 119 homes changing hands compared with 108 a year earlier. Active inventory also grew 12.9%, from 224 listings to 253, giving buyers more to choose from than they had last summer.

That combination — falling prices, rising sales, and more choice — points to a market where sellers have had to meet buyers closer to their terms. The median price per square foot, which adjusts for differences in home size, fell 2.3% year-over-year to $475, a more modest decline than the headline median. The gap suggests part of the drop in the median sale price reflects the mix of homes that sold rather than a uniform fall in values.

On a month-to-month basis, the median price eased 1.8% from $837,000 in the three months ending July. Sales also cooled, falling 15% from 140 to 119, and homes took longer to sell — a typical pattern as the summer buying season winds down. The median time on market stretched to 27 days from 20 a month earlier, though that figure was essentially flat compared with 28 days a year ago.

A market still tilted toward sellers

Despite the softer prices, Davis remains a tight market by most measures. The city had about 2.1 months of supply at the current sales pace, well within what is generally considered a sellers’ market, where buyers face limited choice. Homes sold at 99.6% of their asking price on average, and 22.4% of sales closed above list — down slightly from 24.1% a year earlier.

For longer-term context, the current median remains below the $857,000 recorded in the three months ending August 2024, but prices have risen 9.7% over the past five years, up from a median of $749,000 in the summer of 2021. Davis, with a population of about 66,000, has seen its home values hold well above their pre-pandemic baseline even as recent momentum has cooled.

Nationally, home prices continued to rise year-over-year, according to the S&P/Case-Shiller National Home Price Index, a different picture from the local decline in Davis.

Affordability and borrowing costs

Even with lower prices, Davis remains an expensive place to buy. At the current median, a home costs roughly 9.1 times the median household income of $90,045, according to the U.S. Census Bureau — far above the level generally considered affordable. A buyer putting 20% down on a median-priced home would face a monthly principal-and-interest payment of about $4,230, or roughly 56% of the median household’s monthly income.

Still, the year’s price decline has taken some of the edge off. That $4,230 monthly payment is about $236 less than a buyer would have faced a year ago, when the combination of a higher median price and a slightly lower mortgage rate pushed the equivalent payment to about $4,466. The 30-year fixed mortgage rate averaged 6.67% in August 2026, according to Freddie Mac, up from 6.54% in July and little changed from 6.59% a year earlier.

The falling median price, in other words, has done more to improve affordability over the past year than mortgage rates, which have moved only modestly. For buyers who had been priced out, the summer of 2026 offered slightly more room — more listings to consider, more sales closing, and a median price that has retreated from last year’s levels even as the broader market remains firmly tilted toward sellers.