Full Orange County Housing Report

Inventory:

The active listing inventory added 180 homes in the past couple of weeks, up 12%, and now sits at1,732 homes, still its lowest level for this time of year since tracking began in 2004. Yet, this is the first year since 2019 that the inventory is methodically rising. With a major spike in mortgage rates, demand has cooled. Homes that are priced well and in good condition will fly off the market. Homes that are overpriced, in poor condition, or have an inferior location will accumulate on the market allowing the active inventory to continue to grow. Expect the inventory to continue to surge upward. Normally it peaks during the summer months, prior to the kids going back to school. 

 
Demand:

Demand, a snapshot of the number of new escrows over the prior month, decreased from 2,286 to 2,241 in the past couple of weeks, down 45 pending sales, or 2%. It was the first drop of the year at a time when it typically rises by 4% (pre-COVID average between 2017 to 2019). It appears as if demand may have reached a premature peak a couple of weeks ago. Normally demand peaks between the end of April to the end of May. Current demand is muted due to a major spike in mortgage rates, increasing from 3.25% in January to 5.25% today according to Mortgage News Daily. Affordability has eroded tremendously since ringing in a New Year, sidelining many buyers. Buyers will be a bit more reluctant on price going forward, not as willing to stretch much above recent comparable pending and closed sales, especially as the year progresses. Expect demand to remain muted and slightly fall from now through summer months.




Redderson Real Estate Professionals
Redderson Real Estate Professionals
Broker Associate
1397 Calle Avanzado San Clemente CA 92673