The San Carlos 1H 2026 Real Estate Market Recap

There's an old saying that goes “The days are long, and the years are short“.

That really hits home when you realize we're already heading into the second half of 2026, and it seems like the year started just a few weeks ago. But it has been a solid half-year for the residential real estate market in San Carlos, as you'll see below in the analysis of the data.

I have always kept a very close eye on our local real estate market, but even more so over the past three years as we managed our way through one of the most volatile periods in recent history, second only to the Great Recession of 2008.

After the market hit its absolute peak in 2022, fed by record-low mortgage rates, it tanked the very next year. 11 sequential rate increases effectively dragged the market back to a crawl, and it has taken three years for the market to climb back to historically normal levels.

Total Revenue

As I noted in the San Carlos Q1 Real Estate Recap, 2026 did not start out well for the San Carlos real estate market. Through most of the first quarter, most of the main metrics that I track were lagging slightly behind 2025, which was not a stellar year in the first place. But listing activity rapidly picked up, and home buyers met the challenge.

The total sales revenue, which is the total of all residential real estate sales in San Carlos, including condos, townhomes, and single-family residences, jumped a healthy 25% from Q1 of 2025.

The $426M total revenue (homes and condos) was the third-highest total for the first half of any year on record in San Carlos, inching back up to 2021 and 2022 levels when the market was at its peak.

What's fueling this leap in revenue is a combination of factors: More listings and more closed sales at near-record home prices.

Because condo and townhome sales are an inconsequential portion of the total sales, the rest of the data analysis below will focus solely on single-family homes.

Rebounding Home Prices.

The chart below shows both the average and median prices for homes that were sold in San Carlos in the first half of 2026:.

While both metrics are slightly below the levels set in 2022, they show a trend of three straight years of gradual increases after the market stumbled in 2023. It certainly helped that there were two homes that closed at over $6,000,000 in the first half.

The average price-per-square-foot shows a similar trajectory, although just slightly behind where we were at this point last year:

New Listings and Closed Sales.

The number of new listings and the number of closed sales are two of three key elements that determine the health of a real estate market. The third is price performance, which we already discussed above. The chart below highlights the number of new listings and closed sales for the first half:

As I hinted at the outset of this post, listing activity took a healthy jump upward in the first half of 2026. The 169 single-family home listings were the highest amount for this period since 2021, and again reflect several years of consistent gains.

Another way to assess the relative health of a market is to compare that same number of listings with the number of homes that were put under contract in the same period. How is that relevant?

What you like to see in a graph like the one above is a small gap between the number of new listings and the number of pending sales. That simply implies that listings are being purchased at nearly the same rate at they are being put on the market, which is inarguably the sign of a seller's market.

In the first half of 2025, as circled above, that was not the case. The larger gap between listings and pending sales reflected a market where the rate of listings was certainly strong, but buyers were not responding in kind, and homes sat on the market a bit longer.

Key Takeaways.

If you've made it this far in my quarterly analysis, you hopefully learned some key points:

• After a sluggish start, the San Carlos real estate market awoke and achieved respectable milestones in the first half of this year.
• The number of new single-family home listings hit the highest level in 5 years.
• The average and median home prices are climbing back to record levels, just shy of the peaks hit in 2021 and 2022.
• Home buyers seem undeterred by stubbornly high interest rates and any other economic hurdles.

Looking ahead to the second half of 2026, there are optimistic signals that could further boost our local real estate market. Most notably, if hostilities in the Middle East are successfully resolved, oil prices should fall significantly, which will ease inflationary pressures on home buyers. And if inflation overall drops, that could lead to a reduction in home mortgage interest rates, which always fuels the market.

Additionally, the recent stream of high-profile IPO's will have a definite impact on our market, as more newly minted millionaires look to purchase homes. It's already happening in San Francisco, where the housing market went from dormant to white hot in just two short years.

Questions? Comments? Feel free to leave them in the comments section below!