Orange County Housing Report

July 8, 2014  |  By  | 

comparable sales. Appreciation was rampant. Another bubble in the making. The first half of 2013 was nuts... as in crazy. The inventory dropped to a ridiculous, anemic level. There were not enough homes coming on the market as homeowners sat back and watched their homes appreciate to values that just about restored all of the losses from the Great Recession. Buyers and investors wanted to take advantage of the incredible values and historically low interest rates; they were willing to pay any price for a home, even if that meant paying thousands more than the most recent closed sales. The rocketing appreciation slowed by the midpoint of 2013. Suddenly, homeowners no longer got away with overpricing their homes... and they began to sit. By August, buyers were unwilling to pay extra for a home; instead, they wanted to pay as close to, or less than, the Fair Market Value . The inventory climbed from mid-March through October on the backs of overpriced sellers. The second half of 2013 paved the way for 2014, a year that has been marked thus far with a ballooning increase in the active inventory. Let’s take a closer look at the major changes in 2014 that have differentiated itself as a unique year:  Active Inventory – after starting the year at 4,733, the active listing inventory has increased by 60% and now sits at 7,550 and still climbing. The long term average for all of Orange County is about 8,500 homes and that's within site. Even if that level is not reached this year, the added inventory has created quite a bit of breathing room for buyers.  So many homes are currently overpriced th at a buyers’ sense of urgency has just about vanished. Properly priced homes are flying off the market while the vast majority of sellers learn the hard way that overpricing is a front row ticket to sitting on the market as a spectator.  Demand – there is demand for housing, but there's just not enough realistically priced homes on the market to see the demand. We still get multiple offers on homes that are priced right.

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