Orange County Housing Report
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Here's a quick update on the Orange County real estate market courtesy of Steven Thomas and Reports on Housing:
The active listing inventory shed 39 homes in the past two-weeks, down 1%, and now sits at 4,213, the lowest level for September since tracking began in 2004. The Autumn Market is here. That is when the overall market downshifts with a drop in both supply and demand. It is just not as an advantageous time of the year for families to make a move when the kids go back to school, so both supply and demand downshift. With the active inventory already at historical lows for this time of the year, expect the decline in supply to be slow and methodical.
COVID-19 is no longer suppressing homeowners from coming on the market. In the past four-weeks, there were 591 more homes compared to 2019, 20% extra. This is a new trend that is developing. This may be many homeowners who wanted to sell earlier in the year but waited due to the Coronavirus. There were 27% fewer FOR-SALE sign year over year in 2020 from March through June, a total of 4,318 missing homes that never hit the market. The unbelievable pace of the housing market may be luring homeowners into selling. Los Angeles is the only other county in Southern California where this trend is occurring.
Last year at this time, there were 6,860 homes on the market, 2,647 additional homes, or 63% more. There were a lot more choices for buyers last year.
Demand, the number of new pending sales over the prior month, decreased from 3,340 to 3,256, shedding 84 pending sales, down 3% in two weeks. It appears as if demand finally reached its peak in Orange County two weeks ago. With all the distractions of school and it not being as advantageous of a time to sell for families, the Autumn Market has grabbed hold of the market. Expect demand to slowly drop from here and pick up steam from Thanksgiving through the end of the year. Demand will continue to be boosted by record low rates, but will drop nonetheless.
Last year, demand was at 2,401, that is 855 fewer pending sales compared to today, or 26% less.
In the past two-weeks the Expected Market Time increased from 38 to 39 days, a Hot Seller’s Market (less than 60 days), where sellers get to call the shots during the negotiating process and home values are on the rise. For this time of the year, it is still the strongest level since tracking began in 2012. Last year the Expected Market Time was at 86 days, much slower than today.
In the past two-weeks, demand for homes above $1.25 million decreased by 31 pending sales, down 5%, and now totals 587. It appears as if the Autumn Market is grabbing hold of the luxury market. Even so, luxury demand is still elevated and quite robust. Expect it to slowly drop as the market marches towards a New Year. The luxury home inventory shed 17 homes, a 1% drop, and now totals 1,620. With a significant drop in demand, the overall Expected Market Time for homes priced above $1.25 million increased from 79 to 83 days in the past couple of weeks. Despite the increase, at 83 days luxury remains hot.
Year over year, luxury demand is up by 258 pending sales, or 78%, and the active luxury listing inventory is down by 718 homes, or 31%. The Expected Market Time last year was at 213 days, exceptionally slower than today.
For homes priced between $1.25 million and $1.5 million, in the past two-weeks, the Expected Market Time decreased from 49 to 47 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 58 to 63 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 97 to 106 days. For homes priced above $4 million, the Expected Market Time increased from 222 to 234 days. At 234 days, a seller would be looking at placing their home into escrow around May 2021.