Looking to find out all about the latest Orange County home sales data, while getting a glimpse at what the real estate market here holds in the near future? If so, you’ve come to the right place!
Here’s an important tidbit of information you should be aware of first and foremost: Mortgage rates are a good determination of whether or not it’s a good time to buy a house in Orange County. Indeed, according to the recent Mortgage Watch report we studied, rates are still low despite positive economic data; while we know the Fed could be implementing rate increases, there’s no indication that this will occur anytime soon.
So where does this leave you? While deciding whether it’s time to buy, low mortgage rates tell us that it’s worthwhile to stop renting and look towards purchasing a home.
According to the Orange County Real Estate Market Report that came out just last month, the median sale price of single-family homes in the OC remains over $1 million, with average days on the market down to just 20. With prices continuing to rise due to lack of inventory, this is an ideal time for homeowners to take advantage and sell – and while the hot seller’s market has cooled down just a little as we enter the throes of fall, it’s still offering homeowners amazing returns.
Malakai Sparks Group Fun Fact: If you are considering selling your OC home, now is the smartest time to do just that, with rising home prices that will enable you to get top dollar while securing a record-low mortgage rate on your next dream house.
The following represent three steps we recommend you take as you navigate the current Orange County real estate scene:
- Get information regarding how COVID has changed your home’s value
- Review reports to find out how your area of Orange County is specifically rebounding from coronavirus
- Chat with a knowledgeable Malakai Sparks Group representative to create a personal plan
Let’s now take a look at the California housing market trends, and what’s driving them, for the autumn season.
- Inventory – We touched on this at the beginning, but it is worth going into greater detail about; with only 2,254 single-family homes being reported for sale on the market for September, inventory has dropped 21.7-percent year over year, and low inventory across Orange County (and the entire Golden State) has created more bidding wars with multiple offers becoming commonplace. Low active listings are a telltale sign of a seller’s market.
- Buyer Demand – This factor is still outpacing supply, which is precisely why homes are flying off the market quickly with an average of only 20 days on the circuit. In September, the absorption rate was 77-percent – to put that in perspective, an absorption rate of over 20-percent is considered a “seller’s market,” and anything less than 15-percent is a “buyer’s market.”
- Median Housing Prices – Price increase is inevitable across Orange County, given that the housing inventory hit record lows and demand has been so high; the median housing price of existing single-family homes, as we also touched on above, is up to $1,072,500 – an increase of 17-percent year over year. All across Southern California, home prices have hit record highs this year.
- The Luxury Factor – The average sale price in Newport Beach, as an example, is up to $3,197,899, indicating there is something to be said about the supreme luxury end of the market in these equations. Indeed, even though inventory has only been half of what it was this time last year, there have been significantly more sold transactions. Typically, super-luxurious homes like these sit on the market for several months longer than lower-priced examples, but in the area The Malakai Sparks Group serves, the average days on market is only 37. The summer market has been hot – no pun intended – across all price ranges in SoCal, and this is likely to continue through fall.
To help you decide whether it’s best to buy or rent in Orange County, the following questions represent what renters often consider:
- How long do you want to live here?
- What are your current monthly expenses?
- Can you afford a down payment?
- What kind of lifestyle are you seeking?
Looking to 2022… and Beyond
There is no market crash expected for this year or next, so you can rest easy about that. The last real estate market crash happened in 2008 when the bubble burst and home prices came crashing down with a wave of foreclosures. While the real estate market today boasts the same high prices we saw in 2008, there’s one significant difference – supply and demand.
In 2008, prices were overinflated based on a false sense of demand, but today’s prices are being driven up and naturally based on low supply and very real demand, bolstered by historically low rates.
What you need to know is this: The housing market in the OC is currently booming, and could be for the next few years. In 2022, we expect more inventory to arrive on the market once foreclosures return and home builders pick up the pace. It is going to take some time, and perhaps even policy change, to alter the tide and bring the market back to a “neutral” status.
The Orange County real estate market is always changing and evolving, especially amid the ongoing pandemic, but you can stay on top of all this by working with a Malakai Sparks Group broker.