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The window of opportunity to take advantage of the Summer Market, the second best time of the year for selling, will soon be coming to a close.
Spring is the best time to sell a home, from mid-March through the end of May when the kids get out of school. Demand peaks, and typically, inventory rises. The second best time of the year to sell is the Summer Market, from June through the end of August, when the kids go back to school. Buyers and sellers transact year-round, but families prefer to find a home during the spring or summer and close before the school year starts. Back to school means fewer buyers are yearning to make an immediate move. Buyers with children factor in the inconvenience and strain on their family in moving while the kids are in school. As a result, many buyers wait until the following spring to start the process all over again in isolating a home for their family.
That means sellers coming on the market right now, or over the coming weeks, have very little time to take advantage of the summer season and successfully place their home under contract before housing decelerates and transitions to the Autumn Market.
What we know:
→ Active inventory on the rise
→ Demand rising
→ Sellers adjusting prices
→ Best selling cycle is 60-90 day window
→ Buyer pool continues to shrink in 4th quarter
What we can expect:
→ Demand to hit max in July/August
→ Homes coming on the market accurately priced
→ Inventory peak will be August and early September
Orange County Housing Market Summary:
- The active listing inventory in the past couple of weeks increased by 113 homes, up 5%, and now sits at 2,389, its largest rise of the year. It is still the lowest level for an end to July since tracking began in 2004. In June, 41% fewer homes came on the market compared to the 3-year average before COVID (2017 to 2019), 1,580 less. Last year, there were 4,041 homes on the market, 1,652 more homes, or 69% higher. The 3-year average before COVID (2017 to 2019) was 6,776, or 184% more, nearly triple.
- Demand, the number of pending sales over the prior month, increased by 38 pending sales in the past two weeks, up 2%, and now totals 1,598, still the lowest level for an end to July since tracking began in 2004. Last year, there were 1,693 pending sales, 6% more than today. The 3-year average before COVID (2017 to 2019) was 2,578, or 61% more.
- With supply and demand rising, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased slightly from 44 to 45 days in the past couple of weeks. It was 72 days last year, much slower than today.
- For homes priced below $750,000, the Expected Market Time increased from 29 to 32 days. This range represents 18% of the active inventory and 25% of demand.
- For homes priced between $750,000 and $1 million, the Expected Market Time decreased from 28 to 27 days. This range represents 14% of the active inventory and 24% of demand.
- For homes priced between $1 million to $1.25 million, the Expected Market Time decreased from 29 to 25 days. This range represents 9% of the active inventory and 16% of demand.
- For homes priced between $1.25 million to $1.5 million, the Expected Market Time increased from 34 to 46 days. This range represents 11% of the active inventory and 10% of demand.
- For homes priced between $1.5 million to $2 million, the Expected Market Time decreased from 56 to 53 days. This range represents 14% of the active inventory and 12% of demand.
- For homes priced between $2 million and $4 million, the Expected Market Time in the past two weeks increased from 81 to 83 days. For homes priced between $4 million and $6 million, the Expected Market Time increased from 217 to 253 days. For homes priced above $6 million, the Expected Market Time decreased from 424 to 297 days.
- The luxury end, all homes above $2 million, account for 34% of the inventory and 12% of demand.
- Distressed homes, both short sales and foreclosures combined, comprised only 0.4% of all listings and 0.5% of demand. Only two foreclosures and seven short sales are available today in Orange County, with nine total distressed homes on the active market, down two from two weeks ago. Last year there were 12 distressed homes on the market, similar to today.