The overall Orange County market is a seller's market...
BUT not at all price points.
We're talking about what we in the real estate industry call a change in the market. Below is the latest from the Orange County Housing Report. For the most up-to-date market data, please Sign Up Now to receive real-time housing reports. We deliver the full/downloadable market reports and charts to your inbox every month.
As always, if you or any of your friends or family have real estate goals for 2018, please don’t hesitate to Contact Us. We are only a call, text or email away!
ORANGE COUNTY Housing Report | July 2018
Orange County Housing Report:
Active Inventory: Active inventory increased by 4% in the past 2 weeks.
Current Demand: Current demand decreased 4% in the past 2 weeks.
Luxury End: Luxury demand dropped by 7% in the past 2 weeks.
A Seller's or Buyer's Market?
Real estate articles discuss the overall housing market, highlighting the median sales price. The median sales price has reached a record level in Orange County and in all Southern California. For the Orange County housing report, the median reached a record in May at $738,500. For perspective, the national median was $264,800. Therefore, it is absolutely true that real estate is hot and has been hot since 2012.
While it may be true that the lower the price range, the hotter the market; the reverse is true as well, the higher the price range, the cooler the market. The median of the Orange County housing report, which includes homes below $1 million, accounts for 78% of all closed sales this year. For homes priced above $750,000 in the Orange County market, housing is hot. For homes prices above $1.25 million in the Orange County market, housing is cool.
Let's discuss why the Orange County housing report is shifting:
1. Number of Buyers
The number of potential buyers that can afford to purchase a home diminishes as prices rise. In the lower ranges, that is where there are plenty of buyers and not enough choices. They attract a steady stream of buyers and many sellers entertain multiple offers. Yet, at the luxury end of the market, most sellers sit on the market for months and do not find success. There is tremendous seller competition for a limited number of buyers able to afford these homes.
2. Expected Market Time
While there is plenty of supply, demand just is not hot like the lower ranges. For homes priced between $1.5 million and $2 million, the expected market time is at 150 days. That would be opening escrow at the end of November. For homes priced between $2 million and $4 million, the expected market time climbs to 225 days. That would be opening escrow in mid-February of next year. For homes priced above $4 million, the expected market time balloons to 427 days, which translates to opening escrow in September of next year, 14-months from now.
3. Fair Market Value
Sellers who are not priced close to Fair Market Values are not finding success. In order to find success within the luxury price range, sellers must pack their patience and keep their home on the market for a lot longer than the lower ranges. Some homes may fly off the market at the higher price points, but they are the exception and not the rule. Luxury sellers also must be priced right. Like any home, buyers are unwilling to pay more than a home’s Fair Market Value.
The best advice for a luxury seller: do not pay attention to all of the real estate headlines. Instead, you should rely on the professional analysis and advice of a seasoned REALTOR®. That's where we at The Swan Team come in!
If you need help preparing to buy or sell in 2018 – Contact Us Now!
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If you want to receive real-time Orange County Housing Reports to your inbox every month – for the full/downloadable market reports and charts – Sign Up Now!
The Swan Team | OC Real Estate
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