By any definition for the rest of the world, it's still a very, very strong market. It's just not as crazy hot as it's been." That's how Patrick Carlisle, chief market analyst at Paragon Real Estate Group in San Francisco describes the recent housing market.

A Paragon report that was released last week shows that home prices in San Francisco have cooled significantly. In April and May, the median price of a house rose 2% from the prior year to $1.38 million, which pales in comparison to April and May of 2015 which saw a 23% increase from the prior year. As Bloomberg reports, the cooling is most notable at the high end of the market where there were a record 95 homes on the market for at least $2.5 million at the end of April, up 42% from the prior year. Luxury condos – defined as $2 million or higher – saw inventory climb 44% to a high of 75 units, and sales of all luxury homes declined from January to May for the first time since 2010.