2025 was a tough year in the San Rafael condo market. I personally sold 4 condos in 94903: 2 one bedroom units in the Meadows of Terra Linda, and 2 two bedroom units in Sessions Rise. There was a profound lack of demand through the vast majority of the year. Here were the four biggest obsticals buyers had to overcome:
1) Elevated interest rates – believe it or not we were fortunate in this regards as rates have come down to around 6%. At the beginning of 2025 rates were in the high 6’s to low 7’s. High interest rates along with high HOA dues made owning condos unaffordable for most buyers. 2025 was a buyers market for these condos.
2) High HOA dues – HOA dues throughout Marin County have become a tremendous burden. Unfortunately the reality is that most of the HOAs have deferred maintenance, the cost of which only gets worse. Sometimes HOAs just need to bite the bullet and levy an assessment just to keep up with the rising costs. That can be a more appealing option to a potential buyer than imminent, higher HOA dues.
3) Fire insurance rates – fire insurance premiums on these developments have directly effected the HOA budgets. In hindsight it would have been a good idea to budget for these higher rates in 2020 when California was experiencing an historic fire season. Fire insurance has directly led to higher HOA dues and assessments. Buyers want to have confidence that the property their buying into is well managed, and their budgets have taken into account these higher rates, now and in the future.
4) Inflation & economic uncertainty – Tariff ‘Liberation Day’ occurred on April 2nd, which led to a sharp drop in the stock market. It shouldn’t come as a surprise that by May, the housing market activity became unseasonably quite. Since April the tariff policies have fluctuated unpredictably. Markets do not respond favorably to unpredictable.
All that being said, there is reason for optimism in 2026. The economy seems sound enough, the stock market (a popular downpayment source) is at historic highs, and interest rates have come down. Because home prices came down, we had a robust selling season this fall. 2026 should be a much better year for condo sellers in 94903 than 2025.