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Orange County Housing Report

 


Orange County Housing Report: Unhealthy Pace

August 23, 2021 (Part 2/2)


Although home values have been skyrocketing at a record pace, eating into affordability, the housing market is not going to cool anytime soon.

Housing Will Remain Hot: The Expected Market Time has remained at unprecedented low levels and will not budge much for the remainder of the year.

Everybody looks forward to the Super Bowl. It is not just the excitement surrounding championship football, or the extravagant, over-the-top television commercials, or getting together with family and friends to enjoy the game. It is also about the bountiful feast, the plethora of food options. It is an unhealthy pace in eating for one afternoon per year. Similarly, with market time at unprecedented low levels, home values are shooting skyward, eroding home affordability at an unhealthy pace. Yet, it has been going strong since July of last year and will not slow for the rest of the year and into 2022.

It is great to be a homeowner, but for those aspiring to own a home sometime in the future, the goal is getting harder and harder to reach, and, for some, out of reach. It is important to clear the air and explain that just because housing is appreciating at an unhealthy rate, it does not mean that a bubble is inflating or that housing will inevitably crash. There is absolutely nothing in the charts and data that statistically support that conclusion. Instead, housing is becoming unattainable for more and more first-time homebuyers and renters.

Soaring home values is not healthy and ultimately will limit the number of buyers able to purchase. While affordability is not yet an issue due to record low rates (affordability factors prices, rates, and incomes), eventually values in Orange County will climb to a point where the housing market will slow as more and more buyers stop their search due to monthly payments that are just out of reach. When that occurs depends upon how high values climb, any eventual rise in rates, and the limits to rising incomes. For now, it is not an issue, and the current pace will not change for the rest of 2021.

 

Orange County Housing Market Summary:

  • The active listing inventory increased by 8 homes in the past two-weeks, nearly unchanged, and now totals 2,528. In July, there were 4% fewer homes that came on the market compared to the 3-year average between 2017 to 2019 (2020 was skewed do to COVID-19), 152 less. Last year, there were 4,320 homes on the market, 1,792 additional homes, or 71% more.
  • Demand, the number of pending sales over the prior month, decreased by 115 pending sales in the past two-weeks, down 4%, and now totals 2,694. Last year, there were 3,323 pending sales, 23% more than today, due to a delayed Spring Market.
  • With not much of a change in supply or demand, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased from 27 to 28 days in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 39 days last year slightly slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 24 days. This range represents 29% of the active inventory and 35% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 22 days, a Hot Seller’s Market. This range represents 22% of the active inventory and 28% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 22 days, a Hot Seller’s Market. This range represents 10% of the active inventory and 13% of demand.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 24 days, a Hot Seller’s Market. This range represents 8% of the active inventory and 9% of demand.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 31 to 25 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 52 to 62 days. For homes priced above $4 million, the Expected Market Time increased from 128 to 132 days.
  • The luxury end, all homes above $1.5 million, accounts for 31% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.3% of demand. There are only 7 foreclosures and 5 short sales available to purchase today in all of Orange County, 12 total distressed homes on the active market, down 1 from two-weeks ago. Last year there 15 total distressed homes on the market, very similar to today.
  • There were 3,205 closed residential resales in July, 6% more than July 2020’s 3,011 closed sales. July marked a 10% drop compared to June 2021. The sales to list price ratio was 101.5% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.2%. That means that 99.6% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.


Orange County Housing Report: Forbearance, Foreclosures and Facts

August 9, 2021 (Part 1/2)


Seemingly everyone is expecting a wave of foreclosures due to forbearance, yet taking a closer look at the facts reveals that it simply is not going to happen.

The Distressed Market: Fewer homeowners are opting to sell despite homes appreciating to record levels.

Everyone seems to jump to the plight and struggles of the Great Recession and believe that the housing market is about to repeat itself. Yet, in August 2008, 9.2% of all U.S. mortgages were either delinquent or in foreclosure. By September 2009, it had risen to 14.4%. Today, 3.4% of all mortgages are in forbearance, which amounts to 1.7 million homeowners. The vast majority of those that remain in forbearance will perform and not become a foreclosure or short sale statistic. Why not? It is important to dive a bit deeper and take a look at the huge number who have already exited forbearance, and that’s what I discuss today.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 17 homes in the past two-weeks, down 1%, and now totals 2,520. In July, there were 4% fewer homes that came on the market compared to the 3-year average between 2017 to 2019 (2020 was skewed do to COVID-19), 157 less. Last year, there were 4,449 homes on the market, 1,929 additional homes, or 77% more.
  • Demand, the number of pending sales over the prior month, decreased by 3 pending sales in the past two-weeks, nearly unchanged, and now totals 2,809. Last year, there were 3,281 pending sales, 17% more than today, due to a delayed Spring Market.
  • With not much of a change in supply or demand, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, remained unchanged at 27 days in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 41 days last year and getting hotter.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 20 days. This range represents 28% of the active inventory and 37% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 22 days, a Hot Seller’s Market. This range represents 22% of the active inventory and 27% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 22 days, a Hot Seller’s Market. This range represents 10% of the active inventory and 12% of demand
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 28 days, a Hot Seller’s Market. This range represents 9% of the active inventory and 9% of demand
  • For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 28 to 31 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 55 to 52 days. For homes priced above $4 million, the Expected Market Time decreased from 131 to 128 days.
  • The luxury end, all homes above $1.5 million, accounts for 32% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.2% of demand. There are only 9 foreclosures and 4 short sales available to purchase today in all of Orange County, 13 total distressed homes on the active market, up 1 from two-weeks ago. Last year there were 18 total distressed homes on the market, very similar to today.
  • There were 3,545 closed residential resales in June, 63% more than June 2020’s 2,169 closed sales. June marked a 10% increase compared to May 2021. The sales to list price ratio was 101.4% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Permanently Parked

July 27, 2021 (Part 3/3)


Ever since the Great Recession, far fewer homeowners have been selling their homes annually, and now even fewer are opting to participate in selling their homes.

Lack of Sellers: Fewer homeowners are opting to sell despite homes appreciating to record levels.

Homeowners across the nation watched the housing market take a brutal pounding during the Great Recession as their equity vanished in a blink. Many lost their homes to foreclosures or short sales. Everybody was either personally burned or they knew somebody who experienced the painful sting of the downturn. As a result, a new trend emerged to avoid that lobster red burn with staying power: homeowners remain in their homes for a lot longer. They are content in keeping their home. There are fewer homeowners who opt to sell every year, and even with record home values, the trend continues.

The lack of supply and years of red-hot demand, juiced by record low interest rates (especially since the start of the COVID-19 pandemic), has resulted in homes appreciating to record levels in Orange County, erasing the losses and sting of the Great Recession entirely. This more than a decade long trend is now the norm. Homeowners are not moving as often as they used to.

Buyers must understand that the low turnover rate in the housing stock is here to stay. The pandemic did not help the issue either. This trend is here to stay, which means that the anemic inventory is not going to change much for the rest of the year and into 2022 as well. Most homeowners are simply content with staying put. As a buyer, waiting for a lot more choices is futile. Buyers that opt to wait will be kicking themselves down the road. Instead, cashing in on today’s historically low rates now is the right move. The housing market has the legs to continue at its current trajectory for quite some time.

Orange County Housing Market Summary:

  • The active listing inventory increased by 9 homes in the past two-weeks, nearly unchanged, and now totals 2,537, its highest level since January. In June, there were 12% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 476 less. Last year, there were 4,590 homes on the market, 2,053 additional homes, or 81% more.
  • Demand, the number of pending sales over the prior month, increased by 51 pending sales in the past two-weeks, up 2%, and now totals 2,812. Last year, there were 3,200 pending sales, 14% more than today, due to a delayed Spring Market.
  • With a slight increase in the supply and an increase in demand, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, remained unchanged at 27 days in the past couple of weeks, its highest level since February, but still an extremely Hot Seller’s Market (less than 60 days). It was at 43 days last year and getting hotter.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 20 days. This range represents 28% of the active inventory and 37% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 23 days, a Hot Seller’s Market. This range represents 22% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 23 days, a Hot Seller’s Market. This range represents 20% of the active inventory and 12% of demand.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 28 days, a Hot Seller’s Market. This range represents 9% of the active inventory and 9% of demand.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 30 to 28 days. For homes priced between $2 million and $4 million, the Expected Market Time remained unchanged at 55 days. For homes priced above $4 million, the Expected Market Time decreased from 168 to 131 days.
  • The luxury end, all homes above $1.5 million, accounts for 31% of the inventory and 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.4% of demand. There are only 7 foreclosures and 5 short sales available to purchase today in all of Orange County, 12 total distressed homes on the active market, up 5 from two-weeks ago. Last year there were 25 total distressed homes on the market, slightly more than today.
  • There were 3,545 closed residential resales in June, 63% more than June 2020’s 2,169 closed sales. June marked a 10% increase compared to May 2021. The sales to list price ratio was 101.4% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Not a Good Time to Buy?

July 15, 2021 (Part 2/3)


Potential buyers are being fooled into thinking it is not a good time to purchase and are delaying their plans, ignoring economic facts.

Housing’s Strength: The housing boom has everything to do with supply and demand, and those fundamental features are not going to change anytime soon.

Doctors, dentists, lawyers, investors, neighbors, family, friends, it seems everybody has an opinion on the direction of housing. Unbelievably, only 19% of consumers believe that now is a good time to buy a home. That means that 81% think it is not a good time to buy. There are TikTok videos proclaiming the inevitable crash in housing. No longer than 3-minutes in length, the clips offer Chicken Little titles with no economic backing whatsoever. From YouTube to Facebook, social media has a big opinion when it comes to real estate. All of the noise, the “Gossip Factory,” feeds on everybody’s collective fears and prevents far too many consumers from making the sound decision to participate in this crazy housing market.

ATTENTION BUYERS: now is a great time to buy due to historically low mortgage rates. Housing is going to remain strong due to low inventory levels and strong demand fueled by low rates. It is simple Econ 101. This is not going to change anytime soon with no anticipated flood of homeowners coming to market to change the supply side of the equation. It will be more of the same. Follow an economic model and stop watching TikTok, YouTube, and Facebook videos that are not rooted in a laundry list of economic principles, charts, and irrefutable data.

Orange County Housing Market Summary:

  • The active listing inventory increased by 140 homes in the past two-weeks, up 6%, and now totals 2,528, its highest level since January. In June, there were 14% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 557 less. Last year, there were 4,645 homes on the market, 2,117 additional homes, or 84% more.
  • Demand, the number of pending sales over the prior month, decreased by 145 pending sales in the past two-weeks, down 5%, and now totals 2,761, its lowest level since February. Last year, there were 3,050 pending sales, 10% more than today, due to a delayed Spring Market.
  • With an increase in the supply and a drop in demand, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased from 25 to 27 days in the past couple of weeks, its highest level since February, but still an extremely Hot Seller’s Market (less than 60 days). It was at 46 days last year and getting hotter.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 21 days. This range represents 28% of the active inventory and 37% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 22 days, a Hot Seller’s Market. This range represents 21% of the active inventory and 27% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 22 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 28 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 29 to 30 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 57 to 55 days. For homes priced above $4 million, the Expected Market Time increased from 144 to 168 days.
  • The luxury end, all homes above $1.5 million, accounts for 34% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.4% of demand. There are only 4 foreclosures and 3 short sales available to purchase today in all of Orange County, 7 total distressed homes on the active market, down 3 from two-weeks ago. Last year there were 29 total distressed homes on the market, slightly more than today.
  • There were 3,545 closed residential resales in June, 63% more than June 2020’s 2,169 closed sales. June marked a 10% increase compared to May 2021. The sales to list price ratio was 101.4% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Top 5 Trends

July 1, 2021 (Part 1/3)


Top 5 Housing Trends: With nearly half of 2021 in the rearview mirror, there are noticeable trends that have developed.

It seems as if everyone has an opinion about the future of the housing market. “It’s a bubble.” “The market has peaked.” “I am going to wait for values to come crashing down.” “Housing will continue to be hot for a very long time.” In the end, there is way too much noise that is not supported by facts, ignoring the data. It is time to step aside from the uproar and look at the trends that have surfaced in 2021.

1. The number of available homes to purchase is finally starting to rise. The unprecedented, ultra-low inventory has been the story for over a year now. At the start of last year, there already were not enough homes on the market, and then COVID-19 made things worse when many homeowners opted to not sell their homes. Ultimately, that led to this year’s anemic historically low level of available homes. In fact, today’s inventory is 64% less than the 5-year average of 6,702 homes (from 2015 to 2019 excluding 2020 due to COVID skewing the data). Yet, finally, now that summer has arrived with all of its normal, cyclical distractions, the inventory is on the rise, adding 174 homes, up 8%, within the past couple of weeks, its largest gain of the year. This new trend will continue throughout the summer months.

Watch the above video for my report on the market or send us an email (below) to request the full report for free.

Orange County Housing Market Summary:

  • The active listing inventory increased by 174 homes in the past two-weeks, up 8%, and now totals 2,388, its largest increase of the year and its highest level since February. From June 1st through June 15th, there were 19% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 405 less. Last year, there were 4,710 homes on the market, 2,322 additional homes, or 97% more.
  • Demand, the number of pending sales over the prior month, decreased by 151 pending sales in the past two-weeks, down 5%, and now totals 2,906, its largest decrease of the year and its lowest level since February. Mortgage rates remain at historically low levels, maintaining demand’s current brisk pace. Last year, there were 2,992 pending sales, 3% more than today. It was the first time the prior year was higher than the current year dating back to June 2020.
  • With an increase in the supply and a drop in demand, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased from 22 to 25 days in the past couple of weeks, its highest level since February, but still an extremely Hot Seller’s Market (less than 60 days). It was at 47 days last year and rapidly getting hotter as 2020’s delayed Spring Market had begun.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 18 days. This range represents 28% of the active inventory and 38% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 20 days, a Hot Seller’s Market. This range represents 21% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 18 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 24 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 28 to 29 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 44 to 57 days. For homes priced above $4 million, the Expected Market Time increased from 134 to 144 days.
  • The luxury end, all homes above $1.5 million, accounts for 35% of the inventory and 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.3% of demand.
  • There are only 5 foreclosures and 5 short sales available to purchase today in all of Orange County, 10 total distressed homes on the active market, no change from two-weeks ago. Last year there were 29 total distressed homes on the market, slightly more than today.
  • There were 3,237 closed residential resales in May, 134% more than May 2020’s 1,386 closed sales. May marked an 7% decline from April 2021. The sales to list price ratio was 100.7% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Summer Transition

June 18, 2021 (Part 2/2)


Summer Market: Expect a downshift from the Spring Market to the Summer Market.

The distractions of summer impact the housing market. The busiest time of the year in terms of demand, the Spring Market, comes to an end with the conclusion of the school year and graduations. The Summer Market lasts from the end of May to the start of school at the end of August. Summer is when active buyers are pulled away from the frantic pace of housing. Kids are home and parents are busy carpooling to camps, water parks, pools, beaches, and friends’ houses.

During the Summer Market demand decreases slightly. There are fewer new escrows opened due to buyers placing their home search tours on pause to take a short break and enjoy all the trappings of summer. With demand dropping, the supply of available homes rises as more homeowners place their homes on the market. Many often mistake the Summer Market as the best time of the year to sell a home. In terms of new escrow activity, it is second to the Spring Market. With an increasing supply and falling demand, the Expected Market Time (the amount of time between hammering in the FOR-SALE sign to opening escrow) increases.

In reviewing these trends, many buyers may get ahead of themselves and expect the market to line up in their favor. That is not the case. Instead, the market will remain a Hot Seller’s Market, yet the frantic pace will slow. The changes will be subtle and, over time, will reveal a trend that will result in a shift in the market.

The word on the street within the real estate trenches is that there are already signs of the “summer shift.” A home might not sell in 4 days after being exposed to the market for only a weekend. Instead, it may take two weekends. Homes that are grossly overpriced will have to reduce their asking price. Surprisingly, 6% of the active listing inventory had to reduce their asking price over the past week. Many will scratch their collective heads and wonder what is going on in the market. The answer is simple: SUMMER. It happens every year, and it appears as if this year will be no exception.

Orange County Housing Market Summary:

  • The active listing inventory shed 37 homes in the past two-weeks, down 1.6%, and now totals 2,214. In May, there were 17% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 702 less. Last year, there were 4,950 homes on the market, 2,736 additional homes, or 124% more.
  • Demand, the number of pending sales over the prior month, decreased by 26 pending sales in the past two-weeks, down 1%, and now totals 3,057. Rates remain below 3%, maintaining demand’s current brisk pace. Last year, there were 2,529 pending sales, 17% fewer than today. Keep in mind, housing was improving rapidly in May and June as rates dropped to historically low levels.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, remained unchanged at 22 days in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 74 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 16 days. This range represents 28% of the active inventory and 38% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 16 days, a Hot Seller’s Market. This range represents 20% of the active inventory and 27% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 16 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 22 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time remained unchanged at 28 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 41 to 44 days. For homes priced above $4 million, the Expected Market Time increased from 126 to 134 days.
  • The luxury end, all homes above $1.5 million, accounts for 35% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.3% of demand. There are only 6 foreclosures and 4 short sales available to purchase today in all of Orange County, 10 total distressed homes on the active market, no change from two-weeks ago. Last year there were 24 total distressed homes on the market, more than today.
  • There were 3,237 closed residential resales in May, 134% more than May 2020’s 1,386 closed sales. May marked an 7% decline from April 2021. The sales to list price ratio was 100.7% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Is Housing Unaffordable?

June 4, 2021 (Part 1/2)


Low Rates Prop Up Affordability: Even with record level home prices, low mortgage rates have kept affordability in check.

As home values rocket upwards, affordability weakens, yet homes are still not too far out of reach for most buyers because of low mortgage rates.

It is important to note that when interest rates do rise down the road, that it will impact affordability considerably. At today’s $1,100,000 median detached sales price and $101,000 household income, a 3.5% rate would result in a monthly payment that would be 47% of a homeowner’s income. At 3.75% it would rise to 49%. Today’s historically low mortgage rates have led to a heightened sensitivity to smaller rises in mortgage rates. As rates rise in the future, the housing market will most certainly downshift.

The Bottom Line: In considering today’s ultra-low mortgage rate and rising median household income, the monthly payment for the record level median detached sales price is still affordable. There is not enough emphasis on the importance of looking at the monthly payment of a home and the impact on a family’s budget; instead, way too much weight is placed on where prices stand today.

Orange County Housing Market Summary:

  • The active listing inventory added 8 homes in the past two-weeks, nearly unchanged, and now totals 2,255. From May 1st to May 15th, there were 20% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 424 less. Last year, there were 5,044 homes on the market, 2,789 additional homes, or 123% more.
  • Demand, the number of pending sales over the prior month, decreased by 44 pending sales in the past two-weeks, down 1%, and now totals 3,083. Rates remain below 3%, maintaining demand’s current brisk pace. Last year, there were 2,035 pending sales, 34% fewer than today. Keep in mind, housing was thawing out rapidly in May and June as rates dropped to historically low levels.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, remained unchanged at 22 days in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 74 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 16 days. This range represents 28% of the active inventory and 38% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 17 days, a Hot Seller’s Market. This range represents 20% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 16 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 21 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 22 to 28 days. For homes priced between $2 million and $4 million, the Expected Market Time remained unchanged at 41 days. For homes priced above $4 million, the Expected Market Time increased from 114 to 126 days.
  • The luxury end, all homes above $1.5 million, accounts for 36% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.5% of demand. There are only 5 foreclosures and 5 short sales available to purchase today in all of Orange County, 10 total distressed homes on the active market, down 4 from two-weeks ago. Last year there were 39 total distressed homes on the market, more than today.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Crash Coming?

May 17, 2021 (Part 2/2)


No Crash Coming: Housing data illustrates that there is not a housing crash on the horizon.

Once again, housing is soaring upward with seemingly no end in sight. Buyers are tripping over each other, willing to pay tens of thousands of dollars above the asking price. Throw in the news of rising inflation and the potential of drastically higher mortgage rates, the madness must come to a screeching halt soon, right? Even though so many are anticipating and reporting that a housing crash is eminent, it simply is not going to occur, not now, not in the next 6-months, and not in the foreseeable future. 

There are some naysayers who are calling for a massive spike in mortgage rates due to inflation. Last week’s Consumer Price Index appeared to be soaring out of control with a 4.2% increase over last year. Yet, in taking a closer look at the numbers, the Federal Reserve is correct in their anticipation of “transitory,” or short-lived, inflation. The rise had more to do with short-term supply chain problems in lumber and a global chip shortage. Used cars jumped 10% as car rental companies clamored to restock their depleted inventories. Sporting event prices surged 10.1%, airline tickets climbed 10.2%, and hotel rooms were up by 8.8%. These were all discounted prior because of the pandemic. All other goods were unchanged. As a result, mortgage rates have not moved and remain just below 3%. 

Mortgage rates are forecasted to rise to about 3.5% by year’s end due to an improving economy that is emerging from the pandemic. The rise will not dismantle the housing market; instead, it will decelerate the market from an insanely Hot Seller’s Market with an Expected Market Time of 22 days, to a regular Hot Seller’s Market with a market time above 40 days.

The Bottom Line: The housing market is NOT going to crash. The inventory is low, demand is high, market time is at all-time lows, mortgage rates are at record low levels, buyers must qualify for mortgages, subprime and zero-down loans are not fueling housing, and homeowners have plenty of equity.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 27 homes in the past two-weeks, down 1%, and now totals 2,247, its second lowest level since tracking began in 2004 behind 2,240 achieved on April 1st. In April, there were 13% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 516 less. Last year, there were 4,867 homes on the market, 2,620 additional homes, or 117% more.
  • Demand, the number of pending sales over the prior month, increased by 46 pending sales in the past two-weeks, up 1%, and now totals 3,127. Rates remain below 3%, maintaining demand’s current brisk pace. Last year, there were 1,622 pending sales, 48% fewer than today. Keep in mind, it was the start of the pandemic too, which negatively affected demand through the end of May. 
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, remained unchanged at 22 days in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 90 days last year, slower than today. 
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 16 days. This range represents 29% of the active inventory and 38% of demand. 
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 16 days, a Hot Seller’s Market. This range represents 19% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 15 days, a Hot Seller’s Market. 
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 22 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time remained unchanged at 22 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 46 to 41 days. For homes priced above $4 million, the Expected Market Time decreased from 137 to 114 days.
  • The luxury end, all homes above $1.5 million, accounts for 35% of the inventory and 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.6% of all listings and 0.4% of demand. There are only 9 foreclosures and 5 short sales available to purchase today in all of Orange County, 14 total distressed homes on the active market, up 2 from two-weeks ago. Last year there were 42 total distressed homes on the market, more than today.
  • There were 3,470 closed residential resales in April, 103% more than April 2020’s 1,712 closed sales. March marked an 8% rise over March 2021. It was the strongest closing month since 2005. The sales to list price ratio was 100.3% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: On The Endangered List

May 3, 2021 (Part 1/2)


Vanishing Lower Ranges: A mind-blowing 29% fewer homes have come on the market below $750,000 so far this year.

Housing is definitely not an exception to increasing prices. In the first quarter of 2012, there were 5,553 closed sales below $750,000, 87% of all sales. It was 71% of all sales in 2016, and 51% last year. In 2021, only 41% of all sales were below $750,000 in the first quarter. As home prices have appreciated over the years, the lower price ranges have dwindled and became a smaller percentage of the housing stock. It is not merely the fact that fewer homeowners within these more affordable price ranges have not placed their homes on the market; instead, it has more to do with home values appreciating and surpassing the lower range thresholds. These ranges are vanishing.

The erosion of more affordable housing has been going on for years. This trend will continue as long as the market remains hot. With a depressed, unfathomably low inventory and unrelenting demand fueled by record low rates, this sizzling market is poised to continue for quite some time. The torrid pace will remain through the end of 2021 and is poised to endure through 2022 as well.

For buyers anticipating more homes in the affordable price ranges coming on the market soon, it is just not going to happen. The number of opportunities is diminishing over time. Buyers who wait will be confronted with fewer available options to purchase. More and more homes are surpassing the $500,000 and $750,000 thresholds. In 2012, there were 1,941 detached single family residential homes sales below $500,00 in the first quarter, 53% of all detached closed sales, compared to 29 this year, 0.6% of all closings. In 2012, there were 1,001 detached closed sales in the first quarter between $500,000 and $750,000, 27% of all detached closings, versus 721, or 16%, this year. That means that 80% of all detached sales in 2012 were below $750,000. This year, it was just shy of 17%.

The Bottom Line: while it may be challenging to find a home in the lower ranges today, as homes appreciate, it will only become more challenging in the future.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 110 homes in the past two-weeks, down 5%, and now totals 2,274, its second lowest level since tracking began in 2004 behind 2,240 achieved on April 1st. From April 1 to April 15, there were 13% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 274 less. Last year, there were 4,625 homes on the market, 2,351 additional homes, or 103% more.
  • Demand, the number of pending sales over the prior month, increased by 11 pending sales in the past two-weeks, nearly unchanged, and now totals 3,081. Rates dropped down to below 3% for the first time since February, keeping demand at its current brisk pace. Last year, there were 1,172 pending sales, 62% fewer than today. Keep in mind, it was the start of the pandemic too, which negatively affected demand through May.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased from 23 days to 22 in the past couple of weeks, an extremely Hot Seller’s Market (less than 60 days). It was at 118 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 16 days. This range represents 28% of the active inventory and 39% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 15 days, a Hot Seller’s Market. This range represents 18% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 20 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 23 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 27 to 22 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 45 to 46 days. For homes priced above $4 million, the Expected Market Time decreased from 148 to 137 days.
  • The luxury end, all homes above $1.5 million, accounts for 36% of the inventory and 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.3% of demand. There are only 7 foreclosures and 5 short sales available to purchase today in all of Orange County, 12 total distressed homes on the active market, up 1 from two-weeks ago. Last year there were 44 total distressed homes on the market, more than today.
  • There were 3,212 closed residential resales in March, 35% more than March 2020’s 2,383 closed sales. March marked a 41% rise over February 2021. It was the strongest March closing month since 2005. The sales to list price ratio was 100.3% for all of Orange County. Foreclosures accounted for just 0% of all closed sales, and short sales accounted for 0.09%. That means that 99.91% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Extra! Extra! Inventory Rising!

April 19, 2021 (Part 2/2)


A Rising Inventory: After continuously dropping since last October, the active listing inventory rose by 6%.

The supply of available homes has been experiencing its own severe drought, dropping to levels not seen since records were properly maintained. At this point, any additional FOR-SALE signs hammered into the ground is a welcome relief. In the past two weeks, that is precisely what occurred in Orange County. The active listing inventory rose for the first time since last October, rising from 2,240 to 2,384 homes. The addition of 144 homes was the largest increase since May of last year.

Undoubtedly, for the countless buyers struggling to find a home, the extra inventory is a healthy step in the right direction. It is a new trend that should continue until it reaches a peak later in the year. In Orange County, the inventory typically does not peak until July or August. This year, it may peak even later in the year as mortgage rates are anticipated to rise from 3%, where they stand today, to as high as 3.75% by year’s end. Higher rates will decelerate the housing market and many sellers will languish on the market for a much longer period of time when they overprice. This will ultimately delay the peak. It will remain a Hot Seller’s Market, just not as nutty.

As a result of an increasing supply of homes and a slight drop in demand, the overall Expected Market Time (the time between hammering in the FOR-SALE sign to opening escrow) increased in the past couple of weeks from 21 to 23 days. Currently, the increase may not be that detectable within the real estate trenches, but over time, as more homes accumulate on the market, the market will continue to slowly decelerate. Housing will move away from its crazy, nutty, grossly overheated pace, to a more normal, Hot Seller’s Market. That is a market where sellers need to do a bit more prep work and careful pricing is mandatory.

A Note to Sellers: It is a great time to get ahead of the curve and accurately price a home right out of the starting gates. Overpricing a home is not a sound strategy. Sellers want to expose their properties to as many potential buyers as possible. Accurately pricing permits a seller to obtain as many offers as possible. Multiple offer situations allow offers to be pit against each other and, ultimately, it maximizes the price obtained on a home. Later this year, as the market decelerates, overpricing can lead to fewer multiple offers situations and may even result in remaining on the market without success.

A Note to Buyers: Yes, the current market can be very frustrating, but waiting until more homes come on the market down the road is not the answer. With home values rapidly appreciating and mortgage rates slated to increase as well, buyers who sit on the sideline will ultimately pay more when they reenter down the road. Higher values and higher rates equate to a larger monthly payment. The market is frustrating, but staying the course and continuing to pursue paydirt is the wisest course of action for a buyer in today’s housing market.
The increase in the inventory, whatever the reason, is a much-needed welcome relief to the drought in the supply of homes. This is a new trend that will persist for the next four to six months. There will finally be more choices for buyers.

Orange County Housing Market Summary:

  • The active listing inventory increased for the first time since October, adding 144 homes in the past two-weeks, up 6%, and now totals 2,384. It appears as if the inventory bottomed out two weeks ago. In March, there were 5% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 179 less. Last year, there were 4,344 homes on the market, 1,960 additional homes, or 82% more.
  • Demand, the number of pending sales over the prior month, decreased by 92 pending sales in the past two-weeks, down 3%, and now totals 3,070, its first drop of the year. Even with rates dropping in the past couple of weeks, demand still dropped and may have peaked a couple of weeks ago. Last year, there were 1,990 pending sales, 65% fewer than today. Keep in mind, it was the start of the pandemic too, which negatively affected demand through May.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased for the first time this year from 21 days to 23, an extremely Hot Seller’s Market (less than 60 days). It was at 121 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 18 days. This range represents 29% of the active inventory and 38% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 16 days, a Hot Seller’s Market. This range represents 18% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 17 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 23 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 32 to 27 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 53 to 45 days. For homes priced above $4 million, the Expected Market Time increased from 132 to 148 days.
  • The luxury end, all homes above $1.5 million, accounts for 37% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.3% of demand. There are only 6 foreclosures and 5 short sales available to purchase today in all of Orange County, 11 total distressed homes on the active market, up 3 from two-weeks ago. Last year there were 41 total distressed homes on the market, more than today.
  • There were 3,212 closed residential resales in March, 35% more than March 2020’s 2,383 closed sales. March marked a 41% rise over February 2021. It was the strongest March closing month since 2005. The sales to list price ratio was 100.3% for all of Orange County. Foreclosures accounted for just 0% of all closed sales, and short sales accounted for 0.09%. That means that 99.91% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Waiting Will Be Costly

April 5, 2021 (Part 1/2)


Cost of Waiting: Housing will become more unaffordable as homes continue to rapidly appreciate and mortgage rates rise.

It feels like a dog chasing its own tail, a pointless exercise that ends in exhaustion. After writing offer after offer with no success, many buyers become discouraged and question whether they should continue to pursue their dream in purchasing a home. Maybe they should wait until the market is not so blistering hot, or until they have a larger down payment, or when there are more homes available. The facts and data illustrate why waiting is not a great strategy at all.

In the end, it all adds up to a lot more out of pocket expense on waiting until the end of the year to pull the trigger on a purchase. There is a definite cost to waiting even though the current market is extremely frustrating from a buyer’s perspective. There is a higher monthly mortgage payment. Down payments are larger. Property taxes are higher.

It is better to look at supply and demand. While demand will decrease when rates rise to 3.75% or 4%, it will not shut off demand completely. It will still be a Hot Seller’s Market. It would be like decelerating on the freeway from 140 miles per hour to 80 miles per hour. While it may be slower, it is still speeding. Housing will move from a crazy, nutty market to a more sustainable pace.

With rising rates, the inventory will finally rise from its unparalleled, anemic low level, and demand will decline from its torrid pace. The result will be a market that is much more manageable to navigate, yet still a Hot Seller’s Market. Homes will still appreciate, just not at its current unparalleled pace. There will still be multiple offers, just a few generated on each property compared to the double digits of today.

For buyers, the answer is simple, do not wait to purchase. Waiting will be costly.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 109 homes in the past two-weeks, down 5%, and now totals 2,240, its lowest level since tracking began in 2004. In March, there were 9% fewer homes that came on the market compared to 5-year average between 2015 to 2019 (2020 was skewed do to COVID-19), 342 less. Last year, there were 4,183 homes on the market, 1,943 additional homes, or 87% more.
  • Demand, the number of pending sales over the prior month, increased by 52 pending sales in the past two-weeks, up 2%, and now totals 3,162, its strongest start to April since 2012. The ultra-low mortgage rate environment is continuing to fuel today’s exceptional demand. Last year, there were 1,584 pending sales, 50% fewer than today. Keep in mind, it was the start of the pandemic too, which negatively affected demand through May.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased from 23 days to 21, an extremely Hot Seller’s Market (less than 60 days) and the strongest reading since tracking began in 2004. It was at 79 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 16 days. This range represents 29% of the active inventory and 39% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 13 days, a Hot Seller’s Market. This range represents 16% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 16 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 18 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 31 to 32 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 58 to 53 days. For homes priced above $4 million, the Expected Market Time increased from 116 to 132 days.
  • The luxury end, all homes above $1.5 million, accounts for 39% of the inventory and only 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.4% of demand. There are only 4 foreclosures and 4 short sales available to purchase today in all of Orange County, 8 total distressed homes on the active market, down 3 from two-weeks ago. Last year there were 45 total distressed homes on the market, more than today.
  • There were 2,283 closed residential resales in February, 12% more than January 2020’s 2,044 closed sales. January marked a 1% rise over January 2021. The sales to list price ratio was 98.8% for all of Orange County. Foreclosures accounted for just 0.09% of all closed sales, and short sales accounted for 0.17%. That means that 99.74% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Market Shift

March 22, 2021 (Part 2/2)


The Coming Change in the Housing Market: The sharp rise in mortgage rates from 2.65% during the first week of January to 3.09% today is just the beginning of rising rates.

Housing is in the midst of its own playoff run and has been a Hot Seller’s Market since June of last year, 9-months straight. It is the longest since the 16-month streak that ran from March 2012 through July 2013. What happened in the summer of 2013 to end the run? The market decelerated because of higher mortgage rates.

In 2013, there was very little supply and low mortgage rates were juicing demand. Doesn’t that sound familiar? A low supply and a truck load of demand? The difference between 2013 and 2021 is that the supply of available homes to purchase today is even lower and demand is a bit higher due to even lower mortgage rates.

Now experts are expecting a robust second half of 2021, just a few months away, the start of the next “Roaring 20’s.” Mortgage rates are projected now to increase anywhere between 3.5% to 4%, depending on the size of the economic boom. That is precisely where they were bouncing around prior to the pandemic, a much more normal range. These higher rates will be the catalyst to the market shift and the market will decelerate.

AN IMPORTANT NOTE: It will still be a Hot Seller’s Market. This is NOT a shift to a Buyer’s Market. This a shift from a housing market that is currently nuts, appreciating at about 1% per month, to a regular Hot Seller’s Market with normal, 4% to 5% appreciation per year. Sellers who overprice will sit and languish on the market.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 17 homes in the past two-weeks, down 1%, and now totals 2,349, its lowest level since tracking began in 2004. In February, there were 6% fewer homes that came on the market compared to the prior 5-year average, 209 less. Last year, there were 4,159 homes on the market, 1,810 additional homes, or 77% more.
  • Demand, the number of pending sales over the prior month, increased by 152 pending sales in the past two-weeks, up 5%, and now totals 3,110, its strongest mid-March level since 2012. The ultra-low mortgage rate environment is continuing to fuel today’s exceptional demand. Last year, there were 2,398 pending sales, 23% fewer than today. Keep in mind, it was the start of the pandemic too, which negatively affected demand.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased from 24 days to 23, an extremely Hot Seller’s Market (less than 60 days) and the strongest reading since tracking began in 2004. It was at 52 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 17 days. This range represents 30% of the active inventory and 41% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 14 days, a Hot Seller’s Market. This range represents 16% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 19 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 21 days, a Hot Seller’s Market.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time remained unchanged at 31 days. For homes priced between $2 million and $4 million, the Expected Market Time increased from 55 to 58 days. For homes priced above $4 million, the Expected Market Time decreased from 117 to 116 days.
  • The luxury end, all homes above $1.5 million, accounts for 38% of the inventory and only 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.2% of demand. There are only 8 foreclosures and 3 short sales available to purchase today in all of Orange County, 11 total distressed homes on the active market, up 4 from two-weeks ago. Last year there were 46 total distressed homes on the market, more than today.
  • There were 2,283 closed residential resales in February, 12% more than January 2020’s 2,044 closed sales. January marked a 1% rise over January 2021. The sales to list price ratio was 98.8% for all of Orange County. Foreclosures accounted for just 0.09% of all closed sales, and short sales accounted for 0.17%. That means that 99.74% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: More Homes Coming

March 8, 2021 (Part 1/2)


Here is the listing that I shot this video in: 6 Jencourt, Laguna Niguel.

New FOR-SALE Signs: Nearly a third of all homes that enter the fray during the year come on the housing market over the course of the next three months.

Spring is not only a season of flower blossoms, butterflies, and new life, it is a time when more real estate activity occurs than any other time of the year. It is when the inventory rises and demand surges and peaks. Many mistaken the summer as the best time of the year for real estate, but it is second to spring. During the spring, more homes are listed, there are more new escrows, and there are more closed sales than any other season.

The big question right now is “when are there going to be more homes coming on the market, and how many?” In analyzing the data, it starts in March, the beginning of spring. An elevated number of homes hit the housing market from March through July, peaking in May. According to the 5-year average, the difference between March and May is only 216 homes, 5%, while the difference between February and March is 744 homes. On average, there are 23% more homes in March compared to February. Everyone can be rest assured that the welcome sight of more homes entering the fray has finally arrived and will remain at nearly the same elevated level through July.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 72 homes in the past two-weeks, down 3%, and now totals 2,366, its lowest
    level since tracking began in 2004. In February, there were 10% fewer homes that came on the market compared to the
    prior 5-year average, 319 less. Last year, there were 4,161 homes on the market, 1,795 additional homes, or 76% more.
  • Demand, the number of pending sales over the prior month, increased by 95 pending sales in the past two-weeks, up 3%,
    and now totals 2,958, its strongest start to March since 2012. The ultra-low mortgage rate environment is continuing to
    fuel today’s exceptional demand. Last year, there were 2,583 pending sales, 13% fewer than today.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased
    from 26 days to 24, an extremely Hot Seller’s Market (less than 60 days) and the strongest reading since tracking began
    in 2004. It was at 489 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time
    of 17 days. This range represents 30% of the active inventory and 41% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 16 days, a Hot Seller’s Market. This
    range represents 17% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 22 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 22 days, a Hot Seller’s Market.
  • For luxury homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 39 to 31 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 60 to 55 days. For homes priced above $4 million, the Expected Market Time decreased from 147 to 117 days.
  • The luxury end, all homes above $1.5 million, accounts for 38% of the inventory and only 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.2% of demand. There are only 6 foreclosures and 1 short sale available to purchase today in all of Orange County, 7 total distressed homes on the active market, up 1 from two-weeks ago. Last year there were 36 total distressed homes in the housing market, more than today.
  • There were 2,250 closed residential resales in January, 24% more than January 2020’s 1,817 closed sales. January marked a 27% drop over to December 2020. The sales to list price ratio was 99.0% for all of Orange County. Foreclosures accounted for just 0.04% of all closed sales, and short sales accounted for 0.13%. That means that 99.82% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: No Top In Sight

February 22, 2021 (Part 2/2)


 
Values Rising: The housing market velocity is extremely fast, and it is a Hot Seller’s Market where values are rising swiftly and multiple offers is the norm.

There are not enough homes on the market to keep up with today’s intense buyer demand. There is a run-on housing. Homes are flying off the market faster than they are coming on, and the inventory has been dropping further as the year has progressed. Housing’s momentum lines up strongly in favor of sellers. In looking closely at the housing economic model of supply, demand, mortgage rates, affordability, buyer demographics, and market velocity, the data illustrates that the current trajectory of the housing market is not going to change anytime soon.

With mortgage rates remaining below 3%, a level never reached prior to last year, today’s housing market is one of the strongest on record, and it has everything to do with supply and demand. The current number of available homes to purchase is less than the current demand readings. The active inventory today is at 2,438 homes, and demand (last 30-days of new escrow activity) is at 2,863 pending sales. There are 425 fewer homes available to purchase compared to current demand. Homes are flying into escrow as quickly as they are coming on. The Expected Market Time is at 26 days, less than one month, the lowest level since tracking began in 2004.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 55 homes in the past two-weeks, down 2%, and now totals 2,438, its lowest level since tracking began in 2004. In January, there were 6% fewer homes that came on the market compared to the prior 5-year average, 169 less. Last year, there were 4,030 homes on the market, 1,592 additional homes, or 65% more.
  • Demand, the number of pending sales over the prior month, surged by 273 pending sales in the past two-weeks, up 11%, and now totals 2,863, its strongest mid-February reading since 2013. The record low mortgage rate environment is fueling today’s exceptional demand. Last year, there were 2,479 pending sales, 13% fewer than today.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased from 29 days to 26, an extremely Hot Seller’s Market (less than 60 days) and the strongest reading since tracking began in 2004. It was at 49 days last year, slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 19 days. This range represents 32% of the active inventory and 43% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 16 days, a Hot Seller’s Market. This range represents 16% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 25 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 20 days, a Hot Seller’s Market.
  • For luxury homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 48 to 39 days. For homes priced between $2 million and $4 million, the Expected Market Time decreased from 66 to 60 days. For homes priced above $4 million, the Expected Market Time decreased from 166 to 147 days.
  • The luxury end, all homes above $1.5 million, accounts for 37% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.2% of all listings and 0.2% of demand. There are only 4 foreclosures and 2 short sales available to purchase today in all of Orange County, 6 total distressed homes on the active market, up 2 from two-weeks ago. Last year there were 34 total distressed homes on the market, more than today.
  • There were 2,250 closed residential resales in January, 24% more than January 2020’s 1,817 closed sales. January marked a 27% drop over to December 2020. The sales to list price ratio was 99.0% for all of Orange County. Foreclosures accounted for just 0.04% of all closed sales, and short sales accounted for 0.13%. That means that 99.82% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Bidding War

February 11, 2021 (Part 1/2)


 

Multiple Offers: It is not uncommon for homes marketed FOR-SALE to procure 5, 10, 15, or even more offers to purchase within a few days of coming on the market.

Homes that hit the market are instantly greeted with plenty of buyer interest and a stream of showings. In no time multiple offers follow. Buyers are pitted against each other and a bidding war develops. Countless buyers offer the full asking price, only to receive a counter offer that asks them to come back with their highest and best offer to purchase. Yes, in many cases that means that a buyer must be willing to pay higher than the asking price to be the winning bidder. Many homes ultimately sell for more than their asking prices.

There are a lot of reasons the market is exceptionally hot today. The leading factor is record low mortgage rates. The monthly and annual payment savings are jaw dropping and has been the catalyst to a tsunami of buyer interest. Another factor is the lack of available homes to purchase. There are fewer homes coming on the market right now because it is still the Winter Market. The vast majority of homeowners opt to “wait until the spring” to market their homes. Until then, there should not be the expectation of a lot of new homes hitting the market. With demand so hot, many homes are not available to purchase because they are in escrow. With more escrow activity, the supply diminishes. Also, fewer homes came on the market in January compared to the 5-year average, 9% less, or 266 missing FOR-SALE signs. That may not be a ton of missing signs, but it is adding to the problem.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 134 homes in the past two-weeks, down 5%, and now totals 2,493, its lowest level since tracking began in 2004. In January, there were 9% fewer homes that came on the market compared to the prior 5-year average, 266 less. Last year, there were 4,005 homes on the market, 1,512 additional homes, or 61% more.
  • Demand, the number of pending sales over the prior month, surged by 535 pending sales in the past two-weeks, up 26%, and now totals 2,055, its strongest start to February since 2013. The record low mortgage rate environment is fueling today’s exceptional demand. Last year, there were 2,173 pending sales, 16% fewer than today.
  • The Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, decreased from 38 days to 29, an extremely Hot Seller’s Market (less than 60 days) and the strongest reading since tracking began in 2004. It was at 55 days last year, much slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 22 days. This range represents 33% of the active inventory and 43% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 17 days, a Hot Seller’s Market. This range represents 15% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 21 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 29 days, a Hot Seller’s Market.
  • For luxury homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 56 to 48 days.
  • For homes priced between $2 million and $4 million, the Expected Market Time decreased from 83 to 66 days. For homes priced above $4 million, the Expected Market Time decreased from 220 to 166 days.
  • The luxury end, all homes above $1.5 million, accounts for 38% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.2% of all listings and 0.3% of demand. There are only 2 foreclosures and 2 short sales available to purchase today in all of Orange County, 4 total distressed homes on the active market, down 4 from two-weeks ago. Last year there were 38 total distressed homes on the market, more than today.
  • There were 3,091 closed residential resales in December, 25% more than December 2019’s 2,469 closed sales. December marked a 9% increase compared to November 2020. The sales to list price ratio was 98.7% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Boiling Over

January 28, 2021 (Part 2/2)


Insatiable Demand: With a record low supply of homes available to purchase and staggering demand, the market is extremely hot.

When a commodity drops to a price that is too good to pass up, everybody flocks to purchase. That is precisely what is occurring in housing. It is not that home values have plunged by 40%; instead, it is historically low mortgage rates that are the catalyst to surging demand. As a result, buyers are coming out in droves to purchase. It is too good to pass up. For a $700,000 mortgage at last year’s 3.6% fixed rate, the payment would have been $3,183 per month. With today’s 2.77% rate, the payment drops to $2,865, a $318 per month savings, essentially a 10% discount. Comparing today to November 2018 when rates nearly hit 5%, the savings jumps to $893 per month, a 24% savings. It is not a one-time savings either. This savings is every single month for 30-years.

With record low mortgage rates, there is almost too much demand. It is like a pot of spaghetti that is boiling over. A quick fix would be to turn down the temperature. That is not that easy in housing. The only way to turn down the heat is for rates to rise. Buyers may be rooting for an easier market with less competition, fewer competing offers, and a gentler rise in values, but that would come at the expense of higher rates and higher monthly payments.

It is the very thing that buyers are eager to take advantage of that is causing all their frustrations, record low mortgage rates below 3%. It seems that everyone wants to cash in on these incredible savings at the same time. At lower rates, homes become a lot more affordable, even for Southern California’s high dollar value housing stock. It improves a buyer’s purchasing power as well, allowing a family on a budget to afford a lot more home.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 6 homes in the past two-weeks, nearly unchanged, and now totals 2,627, its lowest January level since tracking began in 2004. COVID-19 is not suppressing the inventory despite the surge in cases. In December, there were 27% more homes that came on the market compared to the prior 5-year average. Last year, there were 4,023 homes on the market, 1,396 additional homes, or 53% more.
  • Demand, the number of pending sales over the prior month, increased by 160 pending sales in the past two-weeks, up 8%, and now totals 2,055, its strongest January level since 2013. COVID-19 has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 1,702 pending sales, 17% fewer than today.
  • The Expected Market Time, the number of months to sell all Orange County listings at the current buying pace, decreased from 42 days to 38, a Hot Seller’s Market (less than 60 days). It is the strongest reading to a January since tracking began in 2004. It was at 71 days last year, much slower than today.
  • For homes priced below $750,000, the market is a Hot Seller’s Market (less than 60 days) with an Expected Market Time of 29 days. This range represents 33% of the active inventory and 44% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 25 days, a Hot Seller’s Market. This range represents 16% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 26 days, a Hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 49 days, a Hot Seller’s Market.
  • For luxury homes priced between $1.5 million and $2 million, the Expected Market Time increased from 55 to 56 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 124 to 83 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 373 to 220 days.
  • The luxury end, all homes above $1.5 million, accounts for 35% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.4% of demand. There are only 4 foreclosures and 4 short sales available to purchase today in all of Orange County, 8 total distressed homes on the active market, down 1 from two-weeks ago. Last year there were 44 total distressed homes on the market, more than today.
  • There were 3,091 closed residential resales in December, 25% more than December 2019’s 2,469 closed sales. December marked a 9% increase compared to November 2020. The sales to list price ratio was 98.7% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Blazing Beginning

January 13, 2021 (Part 1/2)


 
Hot Seller’s Market: With a record low supply of homes available to purchase and staggering demand, the market is extremely hot.

There is an imbalance in supply and demand in the Orange County housing market today. The supply of homes is at a record low and demand is off the charts. As a result, the market has been hot from day one of 2021. The only other time that occurred was back in 2013. What 2013 and 2021 have in common are record low mortgage rates. On January 3, 2013, mortgage rates were at 3.34%, slightly higher than the record low 3.31% achieved on November 21, 2012. On January 7, 2021, according to the Primary Mortgage Market Survey conducted by Freddie Mac for the past 50-years, mortgage rates hit a 17th record low since March, dropping to 2.65%. In the past 10-months, mortgage rates continued to drop to record low territory, dropping below 3% in July for the first time ever. The further rates dropped, the more demand soared, and the hotter the market became.

Today, there are 2,633 homes available to purchase, an ultra-low supply of homes that shattered the prior record low achieved in January 2013, at 3,161. That is 17% lower. To put it into proper perspective, last year there were 3,901 homes, 48% more. Two years ago there were 5,911, 124% more. Current demand (a snapshot of the last 30-days of new escrows) is at 1,895 pending sales, slightly lower than 2013’s 2,031. Yet, it is 32% higher than last year’s 1,434 level, and 63% higher than the 1,165 pending sales reached in 2019.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 42 homes in the past two-weeks, down 2%, and now totals 2,633, its lowest level to start a year since tracking began in 2004. COVID-19 is not suppressing the inventory despite the surge in cases. In December, there were 24% more homes that came on the market compared to the prior 5-year average. Last year, there were 3,901 homes on the market, 1,268 additional homes, or 48% more.
  • Demand, the number of pending sales over the prior month, decreased by 300 pending sales in the past two-weeks, down 14%, and now totals 1,895, its strongest start to a year since 2013. COVID-19 has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 1,434 pending sales, 24% fewer than today.
  • The Expected Market Time for all of Orange County increased from 37 days to 42, a Hot Seller’s Market (less than 60 days). It is the strongest reading to start a year since tracking began in 2004. It was at 82 days last year, much slower than today.
  •  For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an Expected Market Time of 29 days. This range represents 32% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the Expected Market Time is 26 days, a hot Seller’s Market. This range represents 15% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the Expected Market Time is 51 days, a hot Seller’s Market.
  • For homes priced between $1.25 million to $1.5 million, the Expected Market Time is 55 days, a hot Seller’s Market.
  • For luxury homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 57 to 55 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 120 to 124 days. For luxury homes priced above $4 million, the Expected Market Time increased from 304 to 373 days.
  • The luxury end, all homes above $1.5 million, accounts for 37% of the inventory and only 13% of demand.
  •  Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.2% of demand. There are only 4 foreclosures and 5 short sales available to purchase today in all of Orange County, 9 total distressed homes on the active market, down 6 from two-weeks ago. Last year there were 45 total distressed homes on the market, more than today.
  • There were 3,091 closed residential resales in December, 25% more than December 2019’s 2,469 closed sales. December marked a 9% increase compared to November 2020. The sales to list price ratio was 98.7% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Lock It In

December 17, 2020 (Part 1/1)


 

Interest Rates: The current 30-year mortgage rate is at 2.7%, a 14th record low since March.

Today’s mortgage rates are at a record low and they offer the very best deal of the year. Soon, that deal will vanish, and rates will rise, which will impact monthly payments and affordability. Many think the Federal Reserve is in charge of setting mortgage rates, but that is not true. Instead, they set the short term fed funds rate, currently at zero. This rate affects automobile loans, credit card rates, and small business loans, also known as “short term debt.” Long term debt, or 30-year fixed mortgages, are tied closer to long term bonds. Watching any movement in U.S. 10 Year Treasury bonds will indicate where mortgage rates are headed. Prior to this year, the 10-Year has never been below 1% (it is at 0.896% today). Similarly, prior to this year, mortgage rates have never been below 3% (they are at 2.7% today).

Bad economic news drives the 10-Year down and good economic news pushes it higher. COVID-19 and the economic recession due to the forced shutdown of the economy drove the 10-Year below 1% for the first time ever. There is a “spread” between the 10-Year bond and the 30-year mortgage rate that is fairly uniform over time. Capacity constraints and risk aversion prevented mortgage rates from immediately plunging below 3%, but they eventually got there in July.

By mid-2021, the bulk of the U.S. population will be inoculated from the virus. The economy will undoubtedly improve. With all this good news, the 10-Year has improved from 0.645% in September to 0.896% today. In 2021, over the coming months, there will be more good news to follow: a
congressional relief package, more positive vaccine news, positive jobs reports, and positive economic reports. It will not be long before the 10-Year pops above 1%. As a result, expect mortgage rates to increase from today’s exceptional 2.7% level to 3.5% by the end of 2021.

Orange County Housing Market Summary:

  • The active listing inventory plunged by 317 homes in the past two-weeks, down 9%, and now totals 3,152, its lowest level since tracking began in 2004. COVID-19 is not suppressing the inventory despite the recent surge in cases. In November, there were 15% more homes that came on the market compared to last year. Last year, there were 4,546 homes on the market, 1,394 additional homes, or 44% more.
  • Demand, the number of pending sales over the prior month, decreased by 72 pending sales in the past two-weeks, down 3%, and now totals 2,549, its strongest December reading since 2011. COVID-19 has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 1,949 pending sales, 24% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 40 days to 37, its strongest reading in 2020 and a Hot Seller’s Market (less than 60 days). It was at 70 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of
    27 days. This range represents 33% of the active inventory and 45% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 23 days, a hot Seller’s Market. This range represents 16% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 34 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 47 to 36 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 63 to 53 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 123 to 119 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 322 to 248 days.
  • The luxury end, all homes above $1.25 million, accounts for 42% of the inventory and only 20% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.2% of demand. There are only 2 foreclosures and 6 short sales available to purchase today in all of Orange County, 8 total distressed homes on the active market, up 1 from two-weeks ago. Last year there were 68 total distressed homes on the market, more than today.
  • There were 2,843 closed residential resales in November, 25% more than November 2019’s 2,269 closed sales. November marked a 15% drop compared to October 2020. The sales to list price ratio was 98.5% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.2%. That means that 99.7% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Blazing November

November 20, 2020 (Part 2/2)


 
 

Hot November Housing: With an Expected Market Time of 41 days, in the midst of November, the Orange County housing market is hotter than the Spring Markets of 2014 through 2019.

Just because everyone is sipping their favorite Starbucks latte from their recently unveiled holiday cups, does not mean that housing will slow this year. In fact, if a home is priced according to its Fair Market Value and is in great condition, it will procure multiple offers, a bidding war will ensue, and it will often sell for more than the asking price. Home values are on the rise. The difference this year is that there is an ultra-low supply of available properties to purchase and homes are flying into escrow nearly as fast as they are coming on the market. It is sizzling hot in the middle of November and the start of the Holiday Market, now through the first few weeks of January.

The Expected Market Time (the time between pounding in the FOR-SALE sign to opening escrow) is currently at 41 days, a Hot Seller’s Market. The Expected Market time is the overall speed of the market, the lower the number, the faster homes are being placed into escrow. Anything below 60-days is considered a Hot Seller’s Market. That is a market with a tremendous number of showings, multiple offers, sellers get to call the shots, and home values are on the rise.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 101 homes in the past two-weeks, down 3%, and now totals 3,843, its lowest level since January 2018. COVID-19 is not suppressing the inventory. In October, there were 16% more homes that came on the market compared to last year. Last year, there were 5,531 homes on the market, 1,691 additional homes, or 44% more.
  • Demand, the number of pending sales over the prior month, decreased by 220 pending sales in the past two-weeks, down 7%, and now totals 2,799. COVID-19 has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 2,328 pending sales, 17% fewer than today.
  • The Expected Market Time for all of Orange County increased from 39 days to 41, a Hot Seller’s Market (less than 60 days). It was at 71 days last year, slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 30 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 25 days, a hot Seller’s Market. This range represents 16% of the active inventory and 27% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 40 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 50 to 56 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 62 to 72 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 116 to 118 days. For luxury homes priced above $4 million, the Expected Market Time increased from 255 to 308 days.
  • The luxury end, all homes above $1.25 million, accounts for 39% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.3% of demand. There are only 5 foreclosures and 7 short sales available to purchase today in all of Orange County, 12 total distressed homes on the active market, down 1 from two-weeks ago. Last year there were 54 total distressed homes on the market, more than today.
  • There were 3,359 closed residential resales in October, 31% more than October 2019’s 2,564 closed sales. October marked a 0.6% increase compared to September 2020. The sales to list price ratio was 98.4% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.2%. That means that 99.7% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Season’s Greetings

November 3, 2020 (Part 1/2)


 

The Holiday Market: From now through the end of the year, the active inventory typically drops about 27% and demand drops by 31%.

With shorter days and all the distractions of the holidays, housing will downshift with a drop in both the supply, the active inventory of homes available to purchase, and demand, the last 30-days of new escrows. To the buyers and sellers that remain, the overall market will still feel sizzling hot, but there simply will be fewer active participants. Exhausted from politics and COVID-19, the holidays will be a welcome, positive diversion.

The inventory will steadily drop from now through the end of the year. Fewer homeowners will place their homes on the market since 2020’s end is fast approaching. Intuitively, many will simply “wait until spring.” It is a common phenomenon that repeats itself every year. There will still be homeowners lured to enter the fray due to the public knowledge that housing is by far the strongest sector of the United States economy, yet most will opt to wait until at least March of 2021.

At the same time, many homeowners who have attempted to sell for quite some time without success will opt to throw in the proverbial towel and pull their homes off of the market in order to enjoy the holiday season. They will be tired of the lengthy real estate process that did not allow them to achieve their housing goals. In fact, 33% of the current active listing inventory has been on the market for more than two months. It is hard to enjoy all the festivities while buyers continue to set appointments to tour sellers’ homes.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 229 homes in the past two-weeks, down 5%, and now totals 3,944, below 4,000 homes for the first time since January. It is the lowest level for an end to October since 2012. COVID-19 is not suppressing the inventory; from mid-September to mid-October there were 22% more homes that came on the market compared to last year. Last year, there were 5,921 homes on the market, 1,977 additional homes, or 50% more.
  • Demand, the number of pending sales over the prior month, decreased by 134 pending sales in the past twoweeks, down 4%, and now totals 3,019. COVID-19 has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 2,275 pending sales, 25% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 40 days to 39, a Hot Seller’s Market (less than 60 days). It was at 78 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 29 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 25 days, a hot Seller’s Market. This range represents 17% of the active inventory and 27% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 40 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 55 to 50 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 61 to 62 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 109 to 116 days. For luxury homes priced above $4 million, the Expected Market Time increased from 194 to 255 days.
  • The luxury end, all homes above $1.25 million, accounts for 39% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.4% of demand. There are only 6 foreclosures and 7 short sales available to purchase today in all of Orange County, 13 total distressed homes on the active market, down 6 from two-weeks ago. Last year there were 54 total distressed homes on the market, more than today.
  • There were 3,336 closed residential resales in September, 30% more than August 2019’s 2,564 closed sales. September marked a 6% increase compared to August 2020. The sales to list price ratio was 98.4% for all of Orange County. Foreclosures accounted for just 0.1% of all closed sales, and short sales accounted for 0.1%. That means that 99.8% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Values Going Up

October 22, 2020 (Part 2/2)


 
 

Appreciation: With strong demand and an incredibly low inventory, the market will continue to lean heavily in favor of sellers, resulting in home values rising.

When there is a scarcity of something popular for sale, the price goes up. More people are desirous of a good than the number of goods available. If that sounds familiar, it is from the echoing lecture halls of Econ 101. It is basic supply and demand. When very little supply is matched with unbelievably strong demand, prices go up. That is precisely what is occurring in the housing market today.

There is a scarcity of homes for sale. Multiple offers are the norm. It is not uncommon to hear that 15 offers are generated on a home that just hit the market. When this occurs, a bidding war ensues. It is as if a mini auction occurs. The highest and best offer wins and 14 buyers must go back to the drawing board and continue their search for a home. More buyers are desirous of homes than the number of homes available. As a result, home values have been on the rise since June. That is when the Expected Market Time (the time between pounding in the FOR-SALE sign to opening escrow) first dropped below 60-day threshold, a Hot Seller’s Market.

The Expected Market Time is the speed of the market. The lower the Expected Market Time, the faster the market. It takes into consideration both the current inventory of homes available to purchase and buyers demand to pull the trigger and buy a home (the last 30-days of pending sales). Today, it sits at 40 days, far below the 60-day threshold that indicates a Hot Seller’s Market, a market where sellers get to call the shots and values are on the rise.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 60 homes in the past two-weeks, down 1%, and now totals 4,153, its lowest level for a start to October since tracking began in 2004. COVID-19 is not suppressing the inventory; in September there were 21% more homes that came on the market compared to last year. This trend evolved in August when there were 14% more homes year over year. Last year, there were 6,616 homes on the market, 2,463 additional homes, or 59% more.
  • Demand, the number of pending sales over the prior month, decreased by 2 pending sales in the past two-weeks, nearly unchanged, and now totals 3,254. COVID-19 currently has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 2,311 pending sales, 29% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 39 days to 38, a Hot Seller’s Market (less than 60 days). It was at 86 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 28 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 27 days, a hot Seller’s Market. This range represents 18% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 37 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 47 to 48 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 63 to 61 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 106 to 100 days. For luxury homes priced above $4 million, the Expected Market Time increased from 234 to 315 days.
  • The luxury end, all homes above $1.25 million, accounts for 39% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.4% of demand. There are only 8 foreclosures and 8 short sales available to purchase today in all of Orange County, 16 total distressed homes on the active market, up 2 from two-weeks ago. Last year there were 54 total distressed homes on the market, more than today.
  • There were 3,153 closed residential resales in August, 12% more than August 2019’s 2,823 closed sales. August marked a 5% increase compared to July 2020. The sales to list price ratio was 98.8% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.2%. That means that 99.6% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Powerful, Strong, Resilient

October 7, 2020 (Part 1/2)


 

A Powerful Market: With a low supply and extremely strong demand, the Expected Market Time is at its lowest level to start October since tracking began in 2004.

The lighthouse is a perfect metaphor for something that is powerful, strong, and resilient. It is a great metaphor for the current Orange County housing market. It too is extremely strong and is at a powerful level that will endure for quite some time. The momentum and force of housing will push through the current pandemic and economic turbulence. At the root of housing’s strength is simple supply and demand. The active listing inventory is currently at 4,153 homes, its lowest level for a start to October since tracking began in 2004. Only 2012 came close with 4,400 homes. All other years had at least an additional 1,200 homes. In fact, there were 6,616 homes to start October in 2019, an extra 2,463 or 59% more.

The record low interest rate environment is fueling unprecedented demand. Rates have reached 9 record lows so far this year. With mortgage rates below 3%, current demand is off the charts. Demand, the number of pending sales over the prior 30-days, is at 3,254. The last time it was this high was in 2012 when it reached 3,255 at the start of October, yet there were 1,167 short sales and foreclosures embedded in those numbers, 36% of demand. Since short sales required lenders agreeing to take less, many of those short sales never closed. Today there are only 13 short sales and foreclosures included in demand, 0.4%. Last year demand was at 2,311 pending sales, 943 fewer or 29% less.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 60 homes in the past two-weeks, down 1%, and now totals 4,153, its lowest level for a start to October since tracking began in 2004. COVID-19 is not suppressing the inventory; in September there were 21% more homes that came on the market compared to last year. This trend evolved in August when there were 14% more homes year over year. Last year, there were 6,616 homes on the market, 2,463 additional homes, or 59% more.
  • Demand, the number of pending sales over the prior month, decreased by 2 pending sales in the past two-weeks, nearly unchanged, and now totals 3,254. COVID-19 currently has no effect on demand. Record low rates are fueling today’s exceptional demand. Last year, there were 2,311 pending sales, 29% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 39 days to 38, a Hot Seller’s Market (less than 60 days). It was at 86 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 28 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 27 days, a hot Seller’s Market. This range represents 18% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 37 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 47 to 48 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 63 to 61 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 106 to 100 days. For luxury homes priced above $4 million, the Expected Market Time increased from 234 to 315 days.
  • The luxury end, all homes above $1.25 million, accounts for 39% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.4% of demand. There are only 8 foreclosures and 8 short sales available to purchase today in all of Orange County, 16 total distressed homes on the active market, up 2 from two-weeks ago. Last year there were 54 total distressed homes on the market, more than today.
  • There were 3,153 closed residential resales in August, 12% more than August 2019’s 2,823 closed sales. August marked a 5% increase compared to July 2020. The sales to list price ratio was 98.8% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.2%. That means that 99.6% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Dive Into Housing’s Strengths

August 27, 2020 (Part 2/2)


 

Strong Fundamentals: With a low supply, fierce demand, low mortgage rates, and a strong demographic of first-time buyers, the housing market is on strong footing.

As for Orange County housing, the Autumn Market typically starts at the end of August when the kids head back to school. With the Spring and Summer Markets in the rearview mirror, many families back off their pursuit in purchasing a home. Similarly, fewer homeowners enter the fray and many unsuccessful sellers pull their homes off the market. With the kids back in school, the timing just is not the best for families. Moving can be disruptive while the kids are focusing on their education.

Yet, 2020 has been nothing close to ordinary or typical. What should have been the Spring Market, March through May, turned into one of the slowest springs in memory. The “Stay at Home” order and initial shock and anxiety of the Coronavirus kept buyers from buying and homeowners from selling. As the real estate industry adapted becoming an essential service, and the shock of the virus that included social distancing, sanitizing, and dawning a mask waned, housing surged. The Summer Market became the Spring Market in 2020. It appears as if the Autumn Market is going to be the Summer Market in 2020, not quite as hot as June, July, and August, but still quite busy with homes flying off the market and generating multiple offers. All signs point to an extraordinary September, October, and first half of November.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 129 homes in the past two-weeks, down 3%, and now totals 4,320, its lowest level for August since tracking began in 2004. COVID-19 is not suppressing the inventory, but from March through June, 27% fewer homes were placed on the market compared to 2019, or 4,318 missing FOR-SALE signs. Last year, there were 7,307 homes on the market, 2,987 additional homes, or 69% more.
  • Demand, the number of pending sales over the prior month, increased by 42 pending sales in the past two-weeks, up 1%, and now totals 3,323, its highest level since September 2012. COVID-19 currently has no effect on demand. Last year, there were 2,548 pending sales, 23% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 41 days to 39, a Hot Seller’s Market (less than 60 days). It was at 86 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 28 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 28 days, a hot Seller’s Market. This range represents 18% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 40 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 49 to 52 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 68 to 62 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 115 to 107 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 262 to 193 days.
  • The luxury end, all homes above $1.25 million, accounts for 38% of the inventory and only 18% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.3% of all listings and 0.4% of demand. There are only 6 foreclosures and 9 short sales available to purchase today in all of Orange County, 15 total distressed homes on the active market, down 3 from two-weeks ago. Last year there were 52 total distressed homes on the market, more than today.
  • There were 3,010 closed residential resales in July, 5% more than July 2019’s 2,871 closed sales. June marked a 39% increase compared to June 2019. The sales to list price ratio was 98.0% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.2%. That means that 99.5% of all sales were good ol’
    fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Wave of Foreclosures

August 13, 2020 (Part 1/2)


 

The Distressed Market: Foreclosures and short sales make up less than half a percent of the listing inventory and demand.

Due to the recession, everybody is jumping to the worst-case scenario for housing, the inevitable wave of foreclosures to come. It is crucial to immediately point out the simple fact that just because the economy is in the midst of a recession does not mean that the housing market will tank, values must go down, and many homeowners will lose their homes due to foreclosures or short sales. In fact, in the past five recessions, only two have led to declines in real estate values, the recession that began in 1991 and the Great Recession that started in 2008. Both were fueled by asset bubbles in housing that eventually popped. The recession in 1991 was powered by the savings and loan crisis. The Great Recession was driven by subprime lending and risky investments in mortgage securities. Thus, a wave of foreclosures ensued.

Today, the supply of homes to purchase is low, demand is high, and home values are on the rise. Multiple offers are once again the norm. Homes are flying off the market and into escrow. And, tight lending qualifications continue to be the bedrock and strength of housing.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 141 homes in the past two-weeks, down 3%, and now totals 4,449, its lowest level for August since tracking began in 2004. In July, there were 2% more homes placed on the market compared to last year and identical to the 5-year average; thus, COVID-19’s grip on suppressing the inventory has vanished. Last year, there were 7,488 homes on the market, 3,039 additional homes, or 68% more.
  • Demand, the number of pending sales over the prior month, increased by 81 pending sales in the past two-weeks, up 3%, and now totals 3,281, its highest level since September 2012. COVID-19 currently has no effect on demand. Last year, there were 2,606 pending sales, 21% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 43 days to 41, a Hot Seller’s Market (less than 60 days). It was at 89 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 29 days. This range represents 34% of the active inventory and 48% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 29 days, a hot Seller’s Market. This range represents 18% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 42 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 53 to 49 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 81 to 68 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 109 to 115 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 274 to 262 days.
  • The luxury end, all homes above $1.25 million, accounts for 38% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.4% of all listings and 0.4% of demand. There are only 11 foreclosures and 7 short sales available to purchase today in all of Orange County, 18 total distressed homes on the active market, down 7 from two-weeks ago. Last year there were 48 total distressed homes on the market, slightly more than today.
  • There were 2,169 closed residential resales in June, 20% fewer than June 2019’s 2,715 closed sales. The sold data is beginning to reflect the recent surge in demand. June marked a 56% increase compared to May 2020. The sales to list price ratio was 97.6% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.2%. That means that 99.4% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: The Rest of 2020

July 28, 2020 (Part 2/2)


 

Housing Trends: With a low supply and strong demand, the market has not been this hot since 2013.

While unemployment is still high and the overall economy is slowly crawling its way out of a forced stoppage, housing has been a bright spot with a “V-Shaped” recovery. It came roaring back and trends have emerged that pave the way to a strong finish
to 2020 in Orange County.

The active listing inventory has dropped to unprecedentedly low levels. Even at the start of the year, there were not that many homes on the market. Anything that did come on the market quickly opened escrow. Even prior to the shutdown, the inventory had only increased from 3,901 at the beginning of January to 4,159 by March 5th, an increase of only 7%. In March, it was at low levels last experienced in 2013. During the lockdown, COVID-19 suppressed the number of homeowners coming on the market. In April, there were 54% fewer homes that came on the market compared to the 5-year average. Today, there are only 6% fewer homes entering the fray. COVID-19’s grip on preventing homeowners from listing their homes is disappearing.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 55 homes in the past two-weeks, down 1%, and now totals 4,590, its lowest level for July since tracking began in 2004. In the past four-weeks, 6% fewer homes were placed on the market compared to the prior 5-year average. It was a 54% difference at the end of April; thus, COVID-19’s grip on suppressing the inventory is diminishing. Last year, there were 7,601 homes on the market, 3,011 additional homes, or 66% more.
  • Demand, the number of pending sales over the prior month, increased by 150 pending sales in the past two-weeks, up 5%, and now totals 3,200, its highest level since October 2012. COVID-19 currently has no effect on demand. Last year, there were 2,505 pending sales, 22% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 46 days to 43, a Hot Seller’s Market (less than 60
    days). It was at 91 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 31 days. This range represents 34% of the active inventory and 47% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 29 days, a hot Seller’s Market. This range represents 17% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 48 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 60 to 53 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 71 to 81 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 113 to 109 days. For luxury homes priced above $4 million, the Expected Market Time increased from 249 to 274 days.
  • The luxury end, all homes above $1.25 million, accounts for 38% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 0.6% of demand. There are only 12 foreclosures and 13 short sales available to purchase today in all of Orange County, 25 total distressed homes on the active market, down 2 from two-weeks ago. Last year there were 56 total distressed homes on the market, slightly more than today.
  • There were 2,169 closed residential resales in June, 20% fewer than June 2019’s 2,715 closed sales. The sold data is beginning to reflect the recent surge in demand. June marked a 56% increase compared to May 2020. The sales to list price ratio was 97.6% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.2%. That means that 99.4% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Luxury Returns

July 2, 2020 (Part 1/2)


 

Luxury Strength: The upper end of the housing market is strong with plenty of demand.

The luxury housing market in Orange County came to screeching halt in mid-April. It appeared as if luxury housing had perished in 2020 and would not be revived until 2021 at the earliest. The Expected Market Time (the amount of time between hammering in the FOR-SALE sign to opening escrow) increased to 322 days for all homes priced above $1.25 million. Fear and uncertainty shrouded the upper end amidst the COVID-19 pandemic and California’s “stay at home” order. It left many luxury sellers in disbelief, wondering if they would ever be able to sell their homes without major price cuts.

Yet, the market began to improve after bottoming in April. Slowly but surely demand picked up in every price range. Luxury was revived on the backs of increased confidence in Wall Street, a low mortgage rate environment, and the realization of the importance of “home” in the middle of a pandemic. Everybody is acutely aware of the significance of the home office, additional living space, a larger yard, and the many amenities that make life at home more enjoyable.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 239 homes in the past two-weeks, down 5%, and now totals 4,710. In the past four-weeks, 21% fewer homes were placed on the market compared to the prior 5-year average; thus, COVID-19 is still suppressing the inventory. Last year, there were 7,600 homes on the market, 2,890 more than today, a 61% difference.
  • Demand, the number of pending sales over the prior month, increased by 446 pending sales in the past twoweeks, up 18%, and now totals 2,975, the highest level for an end to June since 2013. It has grown by 46% in only 4 weeks. COVID-19’s effect on demand has vanished. Last year, there were 2,548 pending sales, 14% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 59 days to 47, a Hot Seller’s Market (less than 60 days). The drop was due to the surge in demand and a subsequent drop in the supply. It was at 89 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 32 days. This range represents 34% of the active inventory and 50% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 34 days, a hot Seller’s Market. This range represents 18% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 53 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 89 to 80 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 96 to 83 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 175 to 128 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 315 to 239 days.
  • The luxury end, all homes above $1.25 million, accounts for 38% of the inventory and only 17% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.6% of all listings and 0.7% of demand. There are only 12 foreclosure s and 17 short sales available to purchase today in all of Orange County, 29 total distressed homes on the active market, up 5 from two-weeks ago. Last year there were 55 total distressed homes on the market, slightly more than today.
  • There were 1,386 closed residential resales in May, 53% fewer than April 2019’s 2,941 closed sales. This is entirely due to COVID-19 suppressing both supply and demand. May marked a 19% drop compared to April 2020. The sales to list price ratio was 95.4% for all of Orange County. Foreclosures accounted for just 0.6% of all closed sales, and short sales accounted for 0.4%. That means that 99% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Seize the Day

June 19, 2020 (Part 2/2)


 

Lack of Supply: From March through today, one-third fewer homes were placed on the market.

Many homeowners think that now is not a good time to sell because of COVID-19, that “June gloom” has shrouded the Orange County housing market due to the virus. With reports calling for prices to drop, many have come to believe that the market favors buyers and that it is exceedingly difficult to sell. After all, how can you sell a home in this environment, in the midst of a pandemic? These homeowners have their wires crossed and they could not be further from the truth.

Today’s Orange County market is a Hot Seller’s Market with an Expected Market Time (the amount of time between hammering in the FOR-SALE sign to opening escrow) of only 59 days. It is the hottest June since 2013. Homes new to the market are being met with a flood of showings, multiple offers are the norm once again, and sellers are fetching very close to, and often even more than, their asking prices. As far as the housing market is concerned, it is sunny and the water is perfect, a missed opportunity for those homeowners who think otherwise.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 94 homes in the past two-weeks, down 2%, and now totals 4,950. Since March, there have been 33% fewer homes that have come on the market compared to the prior 5-year average. That is 4,580 fewer FOR-SALE signs. COVID-19 is still suppressing the supply of homes. Last year, there were 7,493 homes on the market, 2,543 more than today, a 51% difference.
  • Demand, the number of pending sales over the prior month, increased by 494 pending sales in the past two-weeks, up 24%, and now totals 2,529. It has grown by 56% in only 4 weeks. COVID-19’s effect on housing has vanished. Last year, there were 2,529 pending sales, 5% more than today.
  • The Expected Market Time for all of Orange County decreased from 74 days to 59, a Hot Seller’s Market (less than 60 days). The drop was due to the surge in demand and a subsequent drop in the supply. It was at 84 days last year, much slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 41 days. This range represents 35% of the active inventory and 50% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 42 days, a hot Seller’s Market. This range represents 18% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 70 days, a slight Seller’s Market (between 60 and 90 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 98 to 89 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 116 to 96 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 258 to 175 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 455 to 315 days.
  • The luxury end, all homes above $1.25 million, accounts for 36% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.5% of all listings and 1% of demand. There are only 9 foreclosure s and 15 short sales available to purchase today in all of Orange County, 24 total distressed homes on the active market, down 14 from two-weeks ago. Last year there were 53 total distressed homes on the market, slightly more than today.
  • There were 1,386 closed residential resales in May, 53% fewer than April 2019’s 2,941 closed sales. This is entirely due to COVID-19 suppressing both supply and demand. May marked a 19% drop compared to April 2020. The sales to list price ratio was 95.4% for all of Orange County. Foreclosures accounted for just 0.6% of all closed sales, and short sales accounted for 0.4%. That means that 99% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Hotter Than Last Year

June 5, 2020 (Part 1/2)


 

Getting Hotter: The Expected Market Time for sellers is dropping like a rock as demand expands.

In mid-April, the Expected Market Time (the amount of time from hammering in the FOR-SALE sign to opening escrow) was at 121 days, a slight Buyer’s Market (between 120 and 150 days). Since then, it has dropped by 39% and now the Expected Market Time sits at 74 days, a slight Seller’s Market (between 60 and 90 days), totally unexpected. On average, in the past five years, it has increased by 8 days in the same time period. Last year, the Expected Market Time was at 85 days, slower than today.

There are several factors that have led to the quick recovery in housing. First, housing is coming from a position of strength. Since the Great Recession, credit qualification has been extremely tight. Buyers had to go through a rigorous process of proving that they could afford the monthly payment. Homeowners are sitting on a mountain of nested equity as a result of healthy down payments and steady home value appreciation from 2012 through the start of 2020. And, homeowners did not use their homes as piggy banks like they did prior to the Great Recession when they tapped into their equity to pay for everything from lavish European vacations to erasing ballooning credit card debt from rampant, non-essential spending.

Orange County Housing Market Summary:

  • The active listing inventory increased by 177 homes in the past two-weeks, up 4%, and now totals 5,044. In the past four-weeks, 33% fewer homes were placed on the market compared to the prior 5-year average; thus, COVID-19 is suppressing the inventory. It was 54% fewer four-weeks ago. Last year, there were 7,479 homes on the market, 2,435 more than today, a 48% difference.
  • Demand, the number of pending sales over the prior month, increased by 413 pending sales in the past two-weeks, up 25%, and now totals 2,035. It has grown by 74% in only 4 weeks. COVID-19’s effect on housing is rapidly diminishing. Last year, there were 2,646 pending sales, 23% more than today.
  • The Expected Market Time for all of Orange County decreased from 90 days to 74, a slight Seller’s Market (between 60 and 90 days). The drop was due to the surge in demand outpacing the rise in the supply. It was at 85 days last year, slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 53 days. This range represents 35% of the active inventory and 50% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 56 days, a hot Seller’s Market. This range
    represents 19% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 83 days, a slight Seller’s Market (between 60 and 90 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 129 to 98 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 158 to 116 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 368 to 258 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 540 to 455 days.
  • The luxury end, all homes above $1.25 million, accounts for 35% of the inventory and only 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 0.9% of demand. There are only 16 foreclosure s and 22 short sales available to purchase today in all of Orange County, 38 total distressed homes on the active market, down 4 from two-weeks ago. Last year there were 65 total distressed homes on the market, slightly more than today.
  • There were 1,712 closed residential resales in April, 34% fewer than April 2019’s 2,599 closed sales. This is entirely due to COVID-19 suppressing both supply and demand. April marked a 28% drop compared to March 2020. The sales to list price ratio was 98.3% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.4%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: V-Shaped Recovery

May 21, 2020 (Part 2/2)


Demand Spikes: Demand surged in the past couple of weeks with a 38% rise.

COVID-19 has impacted the economy across the board. The economic data prior to the Coronavirus was pumping on all cylinders. Consumer confidence, consumption, unemployment, housing, stocks, leading economic indicators, everything was pointing to a phenomenal 2020. After the virus broke, every chart was impacted severely. Housing was no exception.

Prior to the “stay at home” order in mid-March, housing was a sizzling hot Seller’s Market with extraordinarily little inventory and unbelievable demand. It was the hottest start to a Spring Market since 2013, a spring to remember for Orange County housing. Low mortgage rates, averaging 3.75%, was stoking the fires of demand. When the virus hit, demand plunged, and the market slowed. Now that it has been a couple of months, flattening the Coronavirus curve has been successful so far. Slowly but surely more of the economy is coming back online. As a result, eager buyers who had been sitting on the fence waiting to purchase are jumping back in and ready to take advantage of record low mortgage rates at 3.25%.

The active inventory climbed by 5% in the past two weeks, close to the 5-year average of 4.4% during this time of the year. The inventory remains at lows last seen in 2013. Surging demand is outpacing the rise in supply, resulting in the Expected Market Time (the time between hammering in the FOR-SALE sign and opening escrow) tumbling from 118 days to 90 days, a slight Seller’s Market (between 60 and 90 days). That is a market where sellers get to call more of the shots, yet home values are not changing much at all. Last year at this time, the Expected Market Time was at 84 days very close to today.

Orange County Housing Market Summary:

  • The active listing inventory increased by 242 homes in the past two-weeks, up 5%, and now totals 4,867. In the past four-weeks, 38% fewer homes were placed on the market compared to the prior 5-year average; thus, COVID-19 is suppressing the inventory. It was 54% fewer two-weeks ago. Last year, there were 7,413 homes on the market, 2,546 more than today, a 52% difference.
  • Demand, the number of pending sales over the prior month, increased by 450 pending sales in the past two-weeks, up 38%, and now totals 1,622, the second largest increase of the year. In the past 5-years, demand has dropped an average of 1%. COVID-19’s effect on housing is beginning to diminish. Last year, there were 2,655 pending sales, 64% more than today.
  • The Expected Market Time for all of Orange County decreased from 118 days to 90, a slight Seller’s Market (between 60 and 90 days). The drop was due to the surge in demand outpacing the rise in the supply. It was at 84 days last year, slightly better than today.
  • For homes priced below $750,000, the market is a slight Seller’s Market with an expected market time of 61 days. This range represents 36% of the active inventory and 53% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 68 days, a slight Seller’s Market. This range represents 19% of the active inventory and 25% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 120 days, a Balanced Market (between 90 and 120 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 192 to 129 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 229 to 158 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 418 to 368 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 586 to 540 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 1.4% of demand. There are only 18 foreclosure s and 24 short sales available to purchase today in all of Orange County, 42 total distressed homes on the active market, down 2 from two-weeks ago. Last year there were 63 total distressed homes on the market, slightly more than today.
  • There were 1,712 closed residential resales in April, 34% fewer than April 2019’s 2,599 closed sales. This entirely due to COVID-19 suppressing both supply and demand. April marked a 28% drop compared to March 2020. The sales to list price ratio was 98.3% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.4%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Demand Rises

May 6, 2020 (Part 1/2)


Rising Demand: Demand rose 9% even though “stay at home” orders have not yet been lifted.

After seven weeks of staying at home, everybody is figuring out ways to make life feel a bit more normal again. DoorDash is on the go delivering food from local favorite restaurants. Church service is now streaming live with the ability to hit pause if the two-year old is acting up. With Zoom meetings all week long, working from home in t-shirts and shorts is not a bad way to get a lot accomplished. The kids are busy cyber learning in their online classrooms. Everybody is adapting to a new way of life. Buyers are adapting as well and are looking for homes again, the market is waking up.

After reaching a low two weeks ago, Orange County had dropped to inherent, natural demand last seen during the start to the Great Recession. Yet, in the past couple of weeks a change was afoot. Reports from the real estate trenches of increased showings and buyers writing offers again were repeated all over the county. Buyers are figuring out that they can still purchase a home in the middle of California’s “stay at home” order.

The real estate industry has adapted to selling homes in this new COVID-19 environment. Buyers view properties wearing protective face masks and disposable, rubber gloves while respecting proper social distancing protocol. Everything else is done electronically, from a list of properties to a comparable market analysis to real estate contracts that grant buyers permission to view and purchase properties. As a result, it is not surprising that demand (the number of pending sales over the prior 30-days) increased by 9% in the past two weeks, growing from 1,080 to 1,172 pending sales.

Orange County Housing Market Summary:

  • The active listing inventory increased by 281 homes in the past two-weeks, up 6%, and now totals 4,625, its largest increase of the year. In the past four-weeks, 54% fewer homes were placed on the market compared to the prior 5-year average; thus, COVID-19 is suppressing the inventory. Last year, there were 7,185 homes on the market, 2,560 more than today, a 55% difference.
  • Demand, the number of pending sales over the prior month, increased by 92 pending sales in the past two-weeks, up 9%, and now totals 1,172, its first increase since the “stay at home” order was placed back in March. In the past 5-years, demand has increased an average of 0%. COVID-19 is continuing to suppress demand; yet, the bottom was reached a couple of weeks ago. Last year, there were 2,653 pending sales, 126% more than today.
  • The Expected Market Time for all of Orange County decreased from 121 days to 118, a Balanced Market (between 90 and 120 days). The drop was due to the rise in demand outpacing the rise in the supply. It was at 81 days last year, much better than today.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 82 days. This range represents 37% of the active inventory and 53% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 86 days, a slight Seller’s Market. This range represents 19% of the active inventory and 26% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 165 days, a Buyer’s Market (greater than 150 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 205 to 192 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 252 to 229 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 363 to 418 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 1,118 to 586 days.
  • The luxury end, all homes above $1.25 million, accounts for 33% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 1% of all listings and 1.6% of demand. There are only 18 foreclosures and 26 short sales available to purchase today in all of Orange County, 44 total distressed homes on the active market, up 3 from two-weeks ago. Last year there were 68 total distressed homes on the market, slightly more than today.
  • There were 2,383 closed residential resales in March, 5% more than March 2019’s 2,277 closed sales. March marked a 17% increase compared to February 2020. The sales to list price ratio was 98.4% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.5%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Broad Market Interruption

April 24, 2020 (Part 2/2)


Supply and Demand: A low supply is confronted with low demand.

Life has changed. Public schools, private schools, day care, universities, date night, dine-in restaurants, sporting events, organized sports, concerts, movie theaters, trips to the mall, amusement parks, public pools, beaches, neighborhood parks, travel, and frozen yogurt have all been put on hold. The “stay at home” order has affected every aspect of daily life. The Orange County housing market is no different.

Demand is defined as the past 30-days of pending sales activity. Up to this point, demand readings have included weeks prior to the order when the housing market was still hitting on all cylinders. The market was scorching hot at the very beginning of march despite the state of emergency that was declared. The market began to decelerate in the second week of March. By March 19th, with the kids already at home and preparing for online learning, housing demand slowed to a COVID-19 crawl. It was at inherent demand levels.

Now that it has been more than four weeks of virus suppressed demand, the Orange County demand readings are a true depiction of the number of pending sales that will take place under the “stay at home” circumstances. The current reading is an accurate indicator of the current market until the economy begins to reopen down the road. There is a broad housing market interruption due to the Coronavirus that has had a major impact on the velocity of the market, demand, and the supply of homes, the active inventory. Both have been impacted significantly. Yes, demand is at ultra-low, anemic levels, but so is the active listing inventory. Buyers are not writing that many offers, and fewer homeowners are pounding FOR SALE signs in their front yards.

As a result of everyday life grinding to a halt, demand dropped by 55% in the past month, from 2,398 pending sales to 1,080. These demand levels were last seen in 2007. Since the “stay at home” order on March 19th, the number of homes placed on the market dropped by 52% compared to the prior 5-year average. That is 1,972 fewer homeowners entering the fray. Consequently, the active inventory has only grown by 185 homes in the past four weeks, a 4% rise, and the inventory now sits at 4,344 homes. While demand may be at Great Recession levels, the inventory is not growing like it did in 2006 through 2008 when it reached nearly 18,000 homes.

Orange County Housing Market Summary:

  • The active listing inventory increased by 161 homes in the past two-weeks, up 4%, and now totals 4,344. In the past fourweeks, 52% fewer homes were placed on the market compared to the prior 5-year average. Last year, there were 6,933 homes on the market, 2,589 more than today, a 60% difference.
  • Demand, the number of pending sales over the prior month, decreased by 504 pending sales in the past two-weeks, down 32%, and now totals 1,080. In the past 5-years, demand has increased an average of 4%. The drop is due to the Coronavirus. Last year, there were 2,724 pending sales, 152% more than today.
  • The Expected Market Time for all of Orange County increased from 79 days to 121, a slight Seller’s Market (between 120 and 150 days). The increase is due to the Coronavirus. It was at 76 days last year, much better than today.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 77 days. This range represents 36% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 96 days, a Balanced Market (between 90 and 120 days). This range represents 19% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 185 days, a Buyer’s Market (greater than 150 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 120 to 205 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 140 to 252 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 323 to 363 days. For luxury homes priced above $4 million, the Expected Market Time increased from 903 to 1,118 days.
  • The luxury end, all homes above $1.25 million, accounts for 35% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 1.7% of demand. There are only 18 foreclosure s and 23 short sales available to purchase today in all of Orange County, 41 total distressed homes on the active market, down 4 from two-weeks ago. Last year there were 59 total distressed homes on the market, slightly more than today.
  • There were 2,383 closed residential resales in March, 5% more than March 2019’s 2,277 closed sales. March marked a 17% increase compared to February 2020. The sales to list price ratio was 98.4% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.5%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: The Showdown

April 10, 2020 (Part 1/2)


Supply and Demand: A low supply is confronted by low demand.

Weak demand has been pitted against a very low supply of homes to purchase. This is precisely why the market is moving towards a Balanced Market and not a Buyer’s Market. The good news for buyers is that they no longer need to rush to purchase. Multiple offers and buyers tripping over each other is no longer the norm. But, that does not mean that buyers are going to get “a deal.” This is NOT the Great Recession. That was a deep buyer’s market fueled by an oversupply of homes and a housing stock built on risky loans. 

The showdown has begun. The “supply problem” has been matched with a “demand problem.” The combination of these two forces will result in housing slowing to a Balanced Market.

COVID-19 Update: Real estate is now an essential service.

On March 28th, the U.S. Department of Homeland Security issued an “Advisory Memorandum” that identified essential, critical infrastructure workers during the COVID-19 response, which included the real estate industry. The order does not mean that open houses and showing, as usual, are back. Thus, the California Association of REALTORS® has issued “Guidelines for Real Estate Best Practices During COVID-19.” Homes in escrow can now conduct professional inspections and on-site appraisals can take place. Virtual tours and professional pictures are strongly recommended and encouraged. Showing properties by appointment only is advised. The bottom line: while real estate is now an essential service, everyone needs to be mindful of social distancing and taking all of the necessary precautions in keeping everybody safe and stopping the spread of the virus.

Orange County Housing Market Summary:

  • The active listing inventory increased by 24 homes in the past two-weeks, up 0.6%, and now totals 4,183. Last year, there were 6,876 homes on the market, 2,693 more than today, a 64% difference.
  • Demand, the number of pending sales over the prior month, decreased by 814 pending sales in the past two-weeks, down 34%, and now totals 1,584. In the past 5-years, demand has increased an average of 5%. The drop is due to the Coronavirus. Last year, there were 2,445 pending sales, 54% more than today.
  • The Expected Market Time for all of Orange County increased from 52 days to 79, a slight Seller’s Market (from 60 to 90 days). The increase is due to the Coronavirus. It was at 84 days last year, similar to today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 51 days. This range represents 36% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 61 days, a slight Seller’s Market. This range represents 18% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 109 days, a Balanced Market (between 90 and 120 days).
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 80 to 120 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 80 to 140 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 248 to 323 days. For luxury homes priced above $4 million, the Expected Market Time increased from 377 to 903 days.
  • The luxury end, all homes above $1.25 million, accounts for 35% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 1% of all listings and 1% of demand. There are only 21 foreclosure s and 24 short sales available to purchase today in all of Orange County, 45 total distressed homes on the active market, down 1 from two-weeks ago. Last year there were 46 total distressed homes on the market, nearly the same as today.
  • There were 2,044 closed residential resales in February, 31% more than February 2019’s 1,564 closed sales. February marked a 12% increase compared to January 2020. The sales to list price ratio was 99.9% for all of Orange County.
    Foreclosures accounted for just 0.6% of all closed sales, and short sales accounted for 0.7%. That means that 98.7% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Rates Are The Fuel That…

February 26, 2020 (Part 1/1)


The Impact of Low Rates: A buyer’s purchasing power has dramatically improved thanks to ultra-low mortgage rates.

Housing has “specially designed jet fuel,” also known as ultra-low mortgage rates, that is allowing the market to soar in 2020. These historically low rates are not going to budge much from the mid-3’s. And, the recent news of the corona-virus has driven mortgage rates lower over the past month.

The Orange County housing market is extremely hot, and as the year unfolds the heat continues to crank higher and higher. The slower markets of 2018 and the first half of 2019 now seem like a distant mirage to most buyers. For a minute, buyers looked as if they were finally going to get a turn, but that all disappeared. In 2020 housing is sizzling hot again.

Advice to Buyers: the low rate environment has significantly improved affordability and allows buyers to stretch their purchasing power to historically high levels. There is not enough emphasis on the importance of the payment of a home; instead, way too much weight is placed on the price.

Advice to Sellers: do not read between the lines of the current hot market as an excuse to overprice. Just as in prior hot markets, many sellers will not find success simply because they stretch the asking price out of bounds. The Fair Market Value of a home is based upon its condition, upgrades, and location. Pricing at or very close to this value allows sellers to obtain the highest sales price.

Orange County Housing Market Summary:

  • The active listing inventory increased by 25 homes in the past two-weeks, up 1%, and now totals 4,030. Last year, there were 6,294 homes on the market, 2,264 more than today, or an extra 56%.
  • Demand, the number of pending sales over the prior month, increased by 306 pending sales in the past two-weeks, up 14%, and now totals 2,479. Last year, there were 2,088 pending sales, 16% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 55 days to 49, a hot Seller’s Market (less than 60 days) and the lowest level since July 2013. It was at 90 days last year, substantially slower than today.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 32 days. This range represents 34% of the active inventory and 52% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 35 days, also a hot Seller’s Market. This range represents 17% of the active inventory and 23% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 55 days, a hot Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 63 to 77 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 117 to 92 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 143 to 134 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 391 to 363 days.
  • The luxury end, all homes above $1.25 million, accounts for 40% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.4% of demand. There are only 15 foreclosure s and 19 short sales available to purchase today in all of Orange County, 34 total distressed homes on the active market, down 4 from two-weeks ago. Last year there were 58 total distressed homes on the market, slightly more than today.
  • There were 1,817 closed residential resales in January, 25% more than January 2019’s 1,458 closed sales. January marked a 26% drop compared to December 2019. The sales to list price ratio was 96.84% for all of Orange County. Foreclosures accounted for just 0.7% of all closed sales, and short sales accounted for 0.2%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Last Call

November 11, 2019 (Part 2/2)


 

LAST CALL: In order for sellers to cash in on the most lucrative time to sell a home during the year, they better open up escrow soon.

It is that time of the year for the family vacation. That includes airports, long lines at the TSA checkpoint, connections, and a bit of stress and anxiety. Inevitably, countless travelers with kids in tow will find themselves running to their connecting flight. The sense of urgency is intense. As if to mock the situation, the flight crew announces, “LAST CALL for flight 93!” Frantically many will barely make it, gasping for air while boarding the plane. Still others will arrive at the gate only to find that the “cabin door has been closed.”

This is also the time of year when many sellers come on the market thinking they have an ample amount of time to market their home to take advantage of the Summer Market, but that simply is not the case. Yes, summer has just begun, but the Summer Market for housing already started in May. The housing market shifts from away from the Spring Market with the distractions of the end of the school year, especially graduations. From there, the distractions of summer and the family activities take hold: family vacations, trips to the beach, trips to the pool, family reunions, summer camps, and picnics. Life gets in the way for many that are looking to purchase a home. As a result, housing downshifts from the best time of the year to sell, the spring, to the second-best time of the year, summer.

Orange County Housing Market Summary:

  • The active listing inventory increased by 14 homes in the past two weeks, nearly unchanged, and now totals 7,493, the highest level since September 2014.
  • Last year, there were 6,105 homes on the market, 1,388 fewer than today. There are 23% more homes than last year.
  • Demand, the number of pending sales over the prior month, increased by 15 pending sales in the past two-weeks, up 1%, and now totals 2,661. Last year, there were 2,699 pending sales, 1% more than today.
  • The Expected Market Time for all of Orange County decreased from 85 days two weeks ago to 84 days today, a slight Seller’s Market (between 60 to 90 days) and test level for this time of the year since 2011. It was at 68 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 61 days. This range represents 39% of the active inventory and 54% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 70 days, a slight Seller’s Market. This range represents 18% of the active inventory and 22% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 92 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 107 to 118 days.
  • For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 167 to 149 days.
  • For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 302 to 254 days.
  • For luxury homes priced above $4 million, the Expected Market Time increased from 419 to 441 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.7% of all listings and 1.4% of demand. There are only 21 foreclosures and 32 short sales available to purchase today in all of Orange County, 53 total distressed homes on the active market, down 12 in the last two-weeks. Last year there were 50 total distressed homes on the market, nearly identical to today.
  • There were 2,929 closed residential resales in May, 2% more than May 2018’s 2,870 closed sales. April marked a 15% increase from April 2019. The sales to list price ratio was 97.6% for all of Orange County.
  • Foreclosures accounted for just 0.8% of all closed sales, and short sales accounted for 0.6%. That means that 98.6% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: What a Twist!

November 7, 2019 (Part 1/2)


 

The housing market just dramatically improved as the inventory plunged and demand increased. 

Sudden Improvement: The Expected Market Time just dropped by 8%.  

Housing has been slowly evolving, flashing signs of change regardless of all the chatter that housing is about to collapse. The twist? In the past two weeks, the market improved significantly, and the Expected Market Time dropped to levels not seen since April, the height of the Spring Market.

In the real estate trenches, buyers are noticing that there are not a lot of choices. In fact, their options are diminishing with the drop in inventory. Exasperated sellers with slow market times and way too many competing FOR SALE signs at the beginning of the year slowly evolved to frustrated buyers bumping into each other as very few homes entered the fray. From 2012 through the first half of 2018, everybody was acutely aware that there were not enough homes on the market. There was a severe supply problem. With mortgage rates climbing all the way up to 5% last November, the market shifted to a demand problem. Payments rapidly drifted skyward and many buyers moved to the sidelines as affordability took a plunge.

Yet, starting in December 2018, mortgage rates drifted downward and crossed below 4% and into the 3’s in June of this year. They have remained in the 3’s ever since. This level has improved affordability tremendously. Even with the unfounded and misguided negative talk about a potential housing bubble or crash, the market has continued to improve, paving the way to solid demand and a rapidly dropping inventory. Once again, there is a supply problem. Everyone will catch on soon as the media reports on the lack of homes for sale through the end of the year and well into 2020.

MAY I HAVE YOUR ATTENTION PLEASE: the housing market is undoubtedly improving. What a twist!

Orange County Housing Market Summary:

  • The active listing inventory decreased by 491 homes in the past two-weeks, down 8%, and now totals 5,921, its lowest level since January and the largest drop of the year. Last year, there were 7,231 homes on the market, 1,310 more than today.
  • Demand, the number of pending sales over the prior month, increased by 24 pending sales in the past two-weeks, up 1%, and now totals 2,275. Last year, there were 1,857 pending sales, 18% fewer than today.
  • The Expected Market Time for all of Orange County dropped from 85 days to 78, a slight Seller’s Market (between 60 to 90 days). It was at 117 days last year and climbing, a much slower market.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 53 days. This range represents 38% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 60 days, also a hot Seller’s Market. This range represents 18% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 100 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 118 to 93 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 200 to 159 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 316 to 317 days. For luxury homes priced above $4 million, the Expected Market Time increased from 619 to 825 days.
  • The luxury end, all homes above $1.25 million, accounts for 35% of the inventory and only 12% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 1.1% of demand. There are only 24 foreclosures and 30 short sales available to purchase today in all of Orange County, 54 total distressed homes on the active market, down one in the past two-weeks. Last year there were 66 total distressed homes on the market, slightly more than today.
  • There were 2,564 closed residential resales in September, 22% more than September 2018’s 2,090 closed sales. September marked a 10% drop compared to August 2019. The sales to list price ratio was 97.2% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, shoot a quick email to info(at)echelberger(dotted)com.

 


Orange County Housing Report: Nope, No Bubble

October 23, 2019 (Part 1/1)


Many buyers are sitting on the sidelines in anticipation of a major housing downturn even though the facts illustrate it simply is not going to happen.

No Bubble: Housing data illustrates that there is not a housing bubble on the horizon. 

It has happened to just about everybody. Driving down the road, unaware of your current speed, a look in the rearview mirror reveals there’s a police car with sirens blazing pulling you over. After receiving the ticket and driving away, for quite some time your driving habits change. You are more cautious, more aware of your surroundings, anticipating at any moment that, inevitably, you will be pulled over again.

The housing market is not as hot today as it was from 2012 through 2017, but that does not mean that the housing is in a bubble. Demand is only slightly sluggish today and the active listing inventory is dropping fast. The storyline since 2012 is that there is a supply problem, not enough homes on the market. That story is true today and will continue in 2020. And, the low interest rate environment with mortgage rates below 4% has substantially helped home affordability and will fuel the housing market for quite some time.

The bottom line: Today’s housing data illustrates a housing market that is on very strong footing. There is no bubble. The inventory is low, buyer demand is not weak, the Expected Market Time is low, and mortgage rates are at historically low levels.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 204 homes in the past two-weeks, down 3%, and now totals 6,412. Last year, there were 7,292 homes on the market, 880 more than today.
  • Demand, the number of pending sales over the prior month, downshifted considerably in the past two-weeks and decreased by 60 pending sales, down 3%, and now totals 2,251. Last year, there were 1,974 pending sales, 12% fewer than today.
  • The Expected Market Time for all of Orange County dropped from 86 to 85 days, a slight Seller’s Market (between 60 to 90 days). It was at 111 days last year and climbing, a much slower market.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 56 days. This range represents 38% of the active inventory and 57% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 70 days, a slight Seller’s Market. This range represents 19% of the active inventory and 23% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 109 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 121 to 118 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 171 to 200 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 332 to 316 days. For luxury homes priced above $4 million, the Expected Market Time increased from 557 to 619 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 12% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.98% of all listings and 1.1% of demand. There are only 23 foreclosures and 32 short sales available to purchase today in all of Orange County, 55 total distressed homes on the active market, down 1 in the past two-weeks. Last year there were 70 total distressed homes on the market, a bit more than today.
  • There were 2,564 closed residential resales in September, 22% more than September 2018’s 2,090 closed sales. September marked a 10% drop compared to August 2019. The sales to list price ratio was 97.2% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Lethargic Luxury

September 27, 2019 (Part 2/2)


Higher priced homes are so much harder to sell compared to the rest of the housing market.

Luxury is Slow: With an Expected Market Time for all homes above $1.25 million of 213 days, luxury is sluggish.

There is no line at the deli counter. You walk in to your favorite restaurant and get seated right away. At the grocery store, all the check stands are open yet not a soul is checking out. It is sunny with no rain in the forecast, but when you pull up to get the car washed there is no wait. That just about sums up the luxury housing market, there are simply not enough buyers compared to the number of sellers; demand is low. There is no line of buyers waiting for yet another luxury home to come on the market.

The headlines can be confusing. They seem to paint a strong housing market. They are NOT reporting on the luxury market; headlines describe the overall market. For homes priced below $1 million, Orange County real estate is much hotter and quite the contradiction compared to the upper end. Luxury housing is sluggish. Weekend open houses are not flooded with potential buyers. Multiple offers are extremely rare. It is not uncommon to go a week, or even weeks, without a single buyer touring a luxury home. There is very little buyer competition.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 137 homes in the past two-weeks, down 2%, and now totals 6,860. Last year, there were 7,207 homes on the market, 347 more than today.
  • Demand, the number of pending sales over the prior month, downshifted considerably in the past two-weeks and decreased by 127 pending sales, down 5%, and now totals 2,401. Last year, there were 2,167 pending sales, 10% fewer than today.
  • The Expected Market Time for all of Orange County remained increased from 83 to 86 days, a slight Seller’s Market (between 60 to 90 days). It was at 100 days last year, a much slower market.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 57 days. This range represents 38% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 72 days, a slight Seller’s Market. This range represents 19% of the active inventory and 22% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 108 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 146 to 136 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 147 to 155 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 220 to 278 days. For luxury homes priced above $4 million, the Expected Market Time increased from 527 to 555 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.5% of demand.
  • There are only 24 foreclosures and 29 short sales available to purchase today in all of Orange County, 53 total distressed homes on the active market, up three in the past two-weeks. Last year there were 68 total distressed homes on the market, slightly more than today.
  • There were 2,823 closed residential resales in August, 0.6% more than August 2018’s 2,806 closed sales. August marked a 2% drop compared to July 2019. The sales to list price ratio was 97.2% for all of Orange County. Foreclosures accounted for just 0.2% of all closed sales, and short sales accounted for 0.3%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Green Shoots

September 12, 2019 (Part 1/2)


Even though the housing market is not as hot as prior years, trends have emerged that confirm that it is starting to heat up.

Green Shoots: Trends are developing which demonstrate that the housing cool down is beginning to heat up.

Headlines are the same across the country: there are more homes on the market and it is taking a lot longer to sell a home. Multiple offers and instantaneous success are characteristics of housing a couple of years ago. After many years of rapid appreciation, demand for homes slowed considerably as mortgage rates climbed to 4.5% in March 2018. Demand deteriorated further when rates unexpectedly squeezed past 5% last November.

Ever since the housing market slowed last year, demand has remained sluggish, a bit subdued in comparison to the hot years from 2012 through 2017. Those markets were characterized by a very limited inventory and sizzling demand. Yet, behind the scenes, the 2019 housing market has been boosted by falling mortgage rates. After starting the year at 4.5%, rates have dropped ever since, dipping below 4% in June for the first time since the end of 2017. Today, they sit at 3.5%, the lowest level since October 2016, nearly three years ago.

As a result of the return to historically low mortgage rates, trends have surfaced that highlight a marketplace that is heating up.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 310 homes in the past two-weeks, down 4%, and now totals 6,997. It was the largest drop so far this year. Last year, there were 7,070 homes on the market, 73 more than today. Two years ago, there were 19% fewer homes on the market.
  • Demand, the number of pending sales over the prior month, decreased by 20 pending sales in the past two-weeks, down 1%, and now totals 2,528. Last year, there were 2,162 pending sales, 14% fewer than today. Two years ago, demand was 4% stronger than today.
  • – The Expected Market Time for all of Orange County remained dropped from 86 to 83 days, a slight Seller’s Market (between 60 to 90 days). It was at 98 days last year.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 57 days. This range represent 38% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 66 days, a slight Seller’s Market. This range represents 19% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 121 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 149 to 146 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 162 to 147 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 249 to 220 days. For luxury homes priced above $4 million, the Expected Market Time increased from 509 to 527 days.
  • The luxury end, all homes above $1.25 million, accounts for 33% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.7% of all listings and 1.4% of demand. There are only 27 foreclosures and 23 short sales available to purchase today in all of Orange County, 50 total distressed homes on the active market, down two in the past two-weeks. Last year there were 56 total distressed homes on the market, slightly more than today.
  • There were 2,871 closed residential resales in July, 5% more than July 2018’s 2,734 closed sales. July marked a 6% increase compared to June 2019. The sales to list price ratio was 98.3% for all of Orange County. Foreclosures accounted for just 0.5% of all closed sales, and short sales accounted for 0.24%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: It Is What It Is

August 29, 2019 (Part 2/2)


Many buyers and sellers are holding out for a major shift in the market favoring their point of view, but housing is not changing anytime soon.

Status Quo: For the rest of the year, the housing market is not going to change much at all. 

What you see in the market today is ultimately what you are going to see for the rest of the year. More simply, it is what it is; what you see is what you get. Values are not going to grow much. The overall pace of housing is not going to change. Housing is going to move along at the same clip. Buyers think that the end of the year is the BEST time of the year to buy. Nope! What you see is what you get. Sellers think that the market is going to suddenly heat up. Nope! What you see is what you get.

Now that it is the Autumn Market, there will be fewer new homes that enter the fray. Combine that with many unsuccessful sellers throwing in the towel and pulling their homes off the market and you have the recipe for an active inventory that will continuously drop. As the year progresses, there will be fewer and fewer choices for buyers. That is normal. Last year, the inventory grew on the backs of rising rates, which is not normal. Current rates are at a three-year low. The inventory is going to do what it normally does at the end of the year, consistently drop. On average, it drops 37% after reaching a peak during the Summer Market.

With both supply and demand dropping at nearly the same rate, the velocity of the market will not change much as well. What you see is what you get. The Expected Market Time, the amount of time it would take from listing a home to placing it in escrow down the road, has increased, on average, by only 2% from August through December during years where housing peaks during the summer. The current Expected Market Time is at 86 days. A 2% change would be an increase to 88 days, nearly unnoticeable for anyone in the real estate trenches.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 181 homes in the past two-weeks, down 2%, and now totals 7,307. The inventory reached a peak for the year of 7,601 four-weeks ago. Last year, there were 7,001 homes on the market, 306 fewer than today, 4% less. Two years ago, there were 20% fewer homes on the market.
  • Demand, the number of pending sales over the prior month, decreased by 81 pending sales in the past two-weeks, down 2%, and now totals 2,548. Last year, there were 2,350 pending sales, 8% fewer than today. Two years ago, demand was 11% stronger than today.
  • The Expected Market Time for all of Orange County remained unchanged at 86 days, a slight Seller’s Market (between 60 to 90 days). It was at 89 days last year.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 57 days. This range represents 38% of the active inventory and 57% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 74 days, a slight Seller’s Market. This range represents 19% of the active inventory and 22% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 117 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 130 to 149 days. For homes priced between $1.5 million and $2 million, the Expected Market Time decreased from 244 to 162 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 280 to 249 days. For luxury homes priced above $4 million, the Expected Market Time increased from 404 to 509 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.7% of all listings and 1.4% of demand. There are only 20 foreclosures and 32 short sales available to purchase today in all of Orange County, 52 total distressed homes on the active market, down five in the past two-weeks. Last year there were 58 total distressed homes on the market, slightly more than today.
  • There were 2,871 closed residential resales in July, 5% more than July 2018’s 2,734 closed sales. July marked a 6% increase compared to June 2019. The sales to list price ratio was 98.3% for all of Orange County. Foreclosures accounted for just 0.5% of all closed sales, and short sales accounted for 0.24%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

Click HERE to download the ShowingTime Reports for the U.S.

Click HERE to download the ShowingTime Report for the Western Region.

 


Orange County Housing Report: The Sky Is Not Falling

August 15, 2019 (Part 1/2)


Buyer demand may not be as hot as prior years, but the Housing market is not collapsing either.

No Housing Collapse: The underlying housing fundamentals have stabilized significantly compared to last year’s slide. 

Last year, major cracks in the housing market emerged. The HOT market continued from 2012 through the start of 2018, until the underlying fundamentals quickly eroded. From May through August of last year, the active inventory climbed by 17%, demand dropped by 10%, and the Expected Market Time (the amount of time it would take from hammering in the FOR SALE sign to opening escrow) rocketed upward. The Expected Market Time continued to soar by climbing an additional 56% from August through the end of the year, compared to a 7% average from 2012 through 2017.

This year, from May to the start of August, the active inventory has remained unchanged, demand has only dropped by 2%, and the Expected Market Time increased by only 1%. Housing is not grinding to a halt. The sky is not falling. Typically for this time of the year, the Summer Market, the active inventory rises, demand drops slightly, and the Expected Market time slowly increases. This year, there has not been much change at all.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 113 homes in the past two-weeks, down 1%, and now totals 7,488. The inventory most likely reached a peak for the year of 7,601 two weeks ago. Last year, there were 6,893 homes on the market, 595 fewer than today. There are 9% more homes than last year.
  • Demand, the number of pending sales over the prior month, increased by 101 pending sales in the past two-weeks, up 4%, and now totals 2,606. Last year, there were 2,394 pending sales, 9% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 91 days two weeks ago to 86 days today, a slight Seller’s Market (between 60 to 90 days). It was at 86 days last year.
  • For homes priced below $750,000, the market is a hot Seller’s Market (less than 60 days) with an expected market time of 58 days. This range represents 38% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 70 days, a slight Seller’s Market. This range represents 19% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 109 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time decreased from 147 to 130 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 240 to 244 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time decreased from 288 to 280 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 500 to 404 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.4% of demand. There are only 20 foreclosures and 37 short sales available to purchase today in all of Orange County, 57 total distressed homes on the active market, up one in the past two-weeks. Last year there were 88 total distressed homes on the market, slightly more than today.
  • There were 2,871 closed residential resales in July, 5% more than July 2018’s 2,734 closed sales. July marked a 6% increase compared to June 2019. The sales to list price ratio was 98.3% for all of Orange County. Foreclosures accounted for just 0.5% of all closed sales, and short sales accounted for 0.24%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Stay Put

July 30, 2019 (Part 1/1)


Fewer Listings: Not as many homeowners are placing their homes on the market than what is typical for this time of the year. 

The lazy days of summer are here. Sitting in the back yard under the umbrella drinking a tall cold glass of lemonade, nothing beats it. Time seems to stand still. The pressures of the rat race of life fade for a moment while basking in the warm summer air. It is a welcome break from the fast pace of working so hard.

The summer of 2019 is shaping up to be quite the same way for housing, many homeowners are kicking back in their homes and enjoying the warmer weather rather than placing their homes on the market.

In Orange County, there were 11% fewer homes that came on the market in June of this year compared to June of 2018. That equates to 439 FOR SALE signs. So far in July, there are 6% fewer, or 159 missing FOR SALE signs year-over-year. For buyers monitoring local housing closely, they have witnessed this recent phenomenon. There simply are not as many new homes coming on for buyers to tour.

Orange County Housing Market Summary:

  • The active listing inventory increased by 40 homes in the past two-weeks, up 0.5%,  and now totals 7,601, the highest level for 2019. In the month of June, 11% fewer homes came on the market compared to June 2018. And, so far in July, it is down by 6%. Last year, there were 6,759 homes on the market, 842 fewer than today. There are 12% more homes than last year.
  • Demand, the number of pending sales over the prior month, increased by 44 pending sales in the past two-weeks, up 2%, and now totals 2,505. Last year, there were 2,393 pending sales, 4% fewer than today.
  • The Expected Market Time for all of Orange County decreased from 92 days two weeks ago to 91 days today, a Balanced Market (between 90 to 120 days) and the highest level for this time of the year since 2011. It was at 85 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 62 days. This range represents 39% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 73 days, a slight Seller’s Market. This range represents 19% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 116 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the Expected Market Time increased from 143 to 147 days. For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 189 to 240 days. For luxury homes priced between $2 million and $4 million, the Expected Market Time increased from 262 to 288 days. For luxury homes priced above $4 million, the Expected Market Time decreased from 518 to 500 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 13% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.7% of all listings and 1.4% of demand. There are only 22 foreclosures and 34 short sales available to purchase today in all of Orange County, 56 total distressed homes on the active market, up one in the past two-weeks. Last year there were 59 total distressed homes on the market, nearly the same as today.
  • There were 2,715 closed residential resales in June, 6% fewer than June 2018’s 2,879 closed sales. June marked a 7% drop from May 2019. The sales to list price ratio was 97.6% for all of Orange County. Foreclosures accounted for just 0.5% of all closed sales, and short sales accounted for 0.4%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: The Price Is Right

May 22, 2019 (Part 1/1)


Pricing: Expired listings are up 64% so far in 2019, illustrating how crucial pricing is this year to avoid becoming another statistic.

Ignoring the expert on pricing advice is understandable, but unfortunate. The best advice is to lean into their years of experience and understanding of current market conditions, trends, and pricing strategies. The emotions behind pricing must be removed to find success. A buyer’s lens is much different. They do not want to inherit deferred maintenance. They want to see upgrades. The location and lot size are important considerations. Most importantly, buyers are not willing to overpay for a home, especially in 2019.

The active listing inventory is at its highest level since 2011. There are 29% more homes on the market compared to last year. With more inventory, the number of unsuccessful sellers is escalating. So far this year, there have been 3,455 expired listings, up 64% compared to last year. Based upon the number of closed sales through April, 30% of homes that were marketed did not find success. At this time last year, it was only 17%.

Orange County Housing Market Summary:

  • The active listing inventory increased by 228 homes in the past two weeks, up 3%, and now totals 7,413, the highest level since September 2014. Last year, there were 5,730 homes on the market, 1,683 fewer than today. There are 29% more homes than last year.
  • Demand, the number of pending sales over the prior month, increased by 2 pending sales in the past two-weeks, nearly unchanged, and now totals 2,655. Last year, there were 2,726 pending sales, 3% more than today.
  • The Expected Market Time for all of Orange County increased from 81 days two weeks ago to 84 days today, a slight Seller’s Market (between 60 to 90 days) and the highest level for this time of the year since 2011. It was at 63 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 61 days. This range represents 39% of the active inventory and 54% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 63 days, a slight Seller’s Market. This range represents 18% of the active inventory and 24% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 93 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time decreased from 128 to 125 days. For homes priced between $1.5 million and $2 million, the expected market time increased from 134 to 174 days. For luxury homes priced between $2 million and $4 million, the expected market time increased from 228 to 262 days. For luxury homes priced above $4 million, the expected market time increased from 463 to 568 days.
  • The luxury end, all homes above $1.25 million, accounts for 34% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.4% of demand. There are only 22 foreclosures and 41 short sales available to purchase today in all of Orange County, 63 total distressed homes on the active market, down 5 in the last two-weeks. Last year there were 42 total distressed homes on the market, fewer than today.
  • There were 2,558 closed residential resales in April, 2% fewer than April 2018’s 2,614 closed sales. April marked a 13% increase from March 2019. The sales to list price ratio was 97.9% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.4%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Seller’s Competition

April 11, 2019 (Part 3/3)


This is the time of the year when more sellers come on the market than any other time of the year.

More Seller Competition: The active listing inventory is rising.

Isn’t it beautiful? Southern California hills are spectacularly adorned in a blanket of bright orange California Poppies. The record rainfall resulted in a “super bloom” like nobody can remember. People are venturing outside to capture the incredible site, hiking and taking selfies along the way. Spring is definitely here!

The record rainfall kept many homeowners from entering the fray and placing their homes on the market. Yet, the deluge of rain is now in the past. That was during the winter, but spring has arrived in housing as well and there is nothing keeping owners from pounding FOR SALE signs in their front yards. Like the blanket of California poppies, this is the time of the year when more FOR SALE signs blanket neighborhoods in Southern California and across the U.S. than any other time of the year.

Nearly a third of all homes that are placed on the market during the year occur from April through June. There has already been an uptick in the number of homes coming on the market within the last couple of weeks. As a result, the active listing inventory in Orange County grew by 5%, adding an additional 344 homes. It now sits at 6,876 homes, its highest level since mid-November of 2018.

Orange County Housing Market Summary:

  • The active listing inventory increased by 344 homes in the past two weeks, up 5%, and now totals 6,876. Last year, there were 4,708 homes on the market, 2,168 fewer than today. There are 46% more homes than last year.
  • So far this year, 3% fewer homes came on the market below $500,000 compared to 2018, and there were 15% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is continuing to vanish.
  • Demand, the number of pending sales over the prior month, increased by 95 pending sales in the past two-weeks, up 4%, and now totals 2,445, its lowest level for this time of the year since 2008. Last year, there were 2,602 pending sales, 6% more than today.
  • The Expected Market Time for all of Orange County increased from 83 days two weeks ago to 84 days today, a slight Seller’s Market (between 60 to 90 days) and the highest level for this time of the year since 2011. It was at 54 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 62 days. This range represents 41% of the active inventory and 55% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 73 days, a slight Seller’s Market. This range represents 18% of the active inventory and 21% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 90 days, a slight Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time increased from 103 to 109 days. For homes priced between $1.5 million and $2 million, the expected market time increased from 146 to 154 days. For luxury homes priced between $2 million and $4 million, the expected market time decreased from 230 to 222 days. For luxury homes priced above $4 million, the expected market time decreased from 562 to 466 days.
  • The luxury end, all homes above $1.25 million, accounts for 32% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.8% of demand.
  • There are only 19 foreclosures and 30 short sales available to purchase today in all of Orange County, 49 total distressed homes on the active market, down two from two-weeks ago. Last year there were 39 total distressed homes on the market, slightly less than today.
  • There were 2,265 closed residential resales in March, 13% fewer than March 2018’s 2,613 closed sales. March marked a 47% increase from February 2019. The sales to list price ratio was 97.3% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.5%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Over The Peak

April 9, 2019 (Part 2/3)


Housing demand in Orange County has already peaked, meaning the market will slow from here.

AN EARLY PEAK: With a slight rise in interest rates since dropping to 4% at the end of March, demand peaked in April this year.

“The Happiest Place on Earth” is right in our back yard. Remember the unbelievable anticipation and unbridled excitement when you were a kid heading to Disneyland with the family? You could barely close your eyes the night before. Now imagine heading to this magic kingdom and arriving at noon. No big deal, on Mondays in May it is open until 11 PM. There is still plenty of time, right? You just missed the first few hours. Those may be THE best hours with the shortest lines, but 11 hours at Disneyland will be amazing and memorable, nonetheless. Selling a home after the peak in demand is similar. THE most optimal time to sell a home maybe in the rearview mirror, but there is still plenty of runway left in the housing market to accomplish the goal in making a move.
Orange County Housing Market Summary:

  • The active listing inventory increased by 252 homes in the past two weeks, up 4%, and now totals 7,185. It was the largest increase so far this year. Last year, there were 5,434 homes on the market, 1,751 fewer than today. There are 32% more homes than last year.
  • Demand, the number of pending sales over the prior month, decreased by 71 pending sales in the past two-weeks, down 3%, and now totals 2,653. Last year, there were 2,675 pending sales, 1% more than today.
  • The Expected Market Time for all of Orange County increased from 76 days two weeks ago to 81 days today, a slight Seller’s Market (between 60 to 90 days) and the highest level for this time of the year since 2011. It was at 61 days last year.
  • For homes priced below $750,000, the market is a Seller’s Market (less than 60 days) with an expected market time of 58 days. This range represents 39% of the active inventory and 55% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 70 days, a slight Seller’s Market. This range represents 19% of the active inventory and 22% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 86 days, a slight Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time increased from 108 to 128 days. For homes priced between $1.5 million and $2 million, the expected market time increased from 133 to 134 days. For luxury homes priced between $2 million and $4 million, the expected market time increased from 186 to 228 days. For luxury homes priced above $4 million, the expected market time increased from 425 to 463 days.
  • The luxury end, all homes above $1.25 million, accounts for 33% of the inventory and only 15% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 1.3% of demand. There are only 27 foreclosures and 41 short sales available to purchase today in all of Orange County, 68 total distressed homes on the active market, up 9 in the last two-weeks. Last year there were 44 total distressed homes on the market, fewer than today.
  • There were 2,558 closed residential resales in April, 2% fewer than April 2018’s 2,614 closed sales. April marked a 13% increase from March 2019. The sales to list price ratio was 97.9% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.4%. That means that 99.3% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: Buyer’s Gamble

April 9, 2019 (Part 1/3)


Many buyers are sitting on the fence waiting for interest rates to fall, but don’t know when to cash in their chips.

Gambling on Rates: Interest rates have fallen to 4.25%, the lowest level in over a year.

So many potential buyers are just like the young gambler, they simply don’t know when they should walk away from the fence they are sitting on and cash in their chips. They are waiting to make the plunge into home ownership but are trying to “time the market.” Unfortunately, so many of these buyers, and homeowners waiting to refinance, have been sitting on the sideline and have already missed prior opportunities to cash in on excellent interest rates. Fortunately, rates are excellent once again

Last week was a huge week for interest rates. The last several months have been huge for interest rates. Since November 2018, interest rates have dropped dramatically from 5% to 4.25%, a substantial difference that helps on the homebuyer affordability front. Today’s rate of 4.25% is the lowest since February 2018.

Orange County Housing Market Summary:

  • The active listing inventory increased by 166 homes in the past two weeks, up 3%, and now totals 6,532. Last year, there were 4,609 homes on the market, 1,923 fewer than today. There are 42% more homes than last year.
  • So far this year, 4% fewer homes came on the market below $500,000 compared to 2018, and there were 15% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is continuing to vanish.
  • Demand, the number of pending sales over the prior month, increased by 78 pending sales in the past two-weeks, up 3%, and now totals 2,350, its lowest level for this time of the year since 2014. Last year, there were 2,538 pending sales, 8% more than today.
  • The Expected Market Time for all of Orange County decreased from 84 days two weeks ago to 83 days today, a slight Seller’s Market (between 60 to 90 days) and the highest level for this time of the year since 2011. It was at 54 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 64 days. This range represents 42% of the active inventory and 54% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 66 days, a slight Seller’s Market. This range represents 18% of the active inventory and 22% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 85 days, a slight Seller’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time increased from 95 to 103 days. For homes priced between $1.5 million and $2 million, the expected market time increased from 140 to 146 days. For luxury homes priced between $2 million and $4 million, the expected market time decreased from 245 to 230 days. For luxury homes priced above $4 million, the expected market time decreased from 650 to 562 days.
  • The luxury end, all homes above $1.25 million, accounts for 32% of the inventory and only 16% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.8% of all listings and 1.8% of demand. There are only 19 foreclosures and 30 short sales available to purchase today in all of Orange County, 49 total distressed homes on the active market, down two from two-weeks ago. Last year there were 39 total distressed homes on the market, slightly less than today.
  • There were 1,543 closed residential resales in February, 15% fewer than February 2018’s 1,820 closed sales. February marked a 6% increase from January 2019.The sales to list price ratio was 97.4% for all of Orange County. Foreclosures accounted for just 0.3% of all closed sales, and short sales accounted for 0.6%. That means that 99.1% of all sales were good ol’ fashioned sellers with equity

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: 10 Year Drought

March 4, 2019 (Part 1/1)


Ever since the Great Recession, far fewer homeowners have been selling their homes annually, a trend that is not going away.

Lack of Sellers: Fewer homeowners are opting to sell in spite of homes appreciating to record levels.

Millions flock to the Hawaiian Islands to escape the grind of everyday life and bask in the tropical sun and warm waters. After relaxing for hours on the sand and swimming in the aqua blue surf, so many vacationers forget to reapply sunscreen. Upon returning to the hotel room, the inevitable has occurred. Looking in the mirror they confirm they have a lobster red sunburn from head to toe. Nearly everybody has experienced the pain of a deep sunburn. It is hard to sleep, hard to take showers, and hard to go back out in the sunshine again. The pain is a reminder to never forget to reapply sunscreen again.

Similarly, homeowners across the nation watched the housing market take a pounding during the Great Recession as their equity vanished in a blink. Many lost their homes to short sales or foreclosures. Everybody either personally got stung by the correction or knew of somebody who did. As a result, a new trend emerged to avoid a lobster red burn in the future: homeowners stay in their homes a lot longer. There are far fewer homeowners who opt to sell every year. Even with record home values, the trend continues.

Orange County Housing Market Summary:

  • The active listing inventory increased by 194 homes in the past two weeks, up 3%, and now totals 6,294. Last year, there were 4,178 homes on the market, 2,116 fewer than today. There are 51% more homes than last year.
  • In January, 2% fewer homes came on the market below $500,000 compared to 2018, and there were 19% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is continuing to vanish.
  • Demand, the number of pending sales over the prior month, continued its rapidly rise in the past two-weeks, climbing by 297 pending sales, up 17%, and now totals 2,088, its lowest level for this time of the year since 2008. Last year, there were 2,441 pending sales, 17% more than today.
  • The Expected Market Time for all of Orange County decreased from 102 days two weeks ago to 90 days today, a Balanced Market (between 90 to 120 days) and the highest level for this time of the year since 2011. It was at 51 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 72 days. This range represents 44% of the active inventory and 55% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 96 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time decreased from 144 to 132 days. For homes priced between $1.5 million and $2 million, the expected market time decreased from 209 to 173 days. For luxury homes priced between $2 million and $4 million, the expected market time decreased from 241 to 234 days. For luxury homes priced above $4 million, the expected market time decreased from 582 to 573 days.
  • The luxury end, all homes above $1.25 million, accounts for 31% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 1.3% of demand. There are only 21 foreclosures and 37 short sales available to purchase today in all of Orange County, 58 total distressed homes on the active market, down one from two-weeks ago. Last year there were 40 total distressed homes on the market, slightly less than today.
  • There were 1,461 closed residential resales in January, 19% fewer than January 2018’s 1,800 closed sales. January marked an 18% drop from December 2018. The sales to list price ratio was 96.7% for all of Orange County. Foreclosures accounted for just 0.8% of all closed sales, and short sales accounted for 0.6%. That means that 98.6% of all sales were good ol’ fashioned sellers with equity.
  • To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: The Neutral Zone

February 22, 2019 (Part 2/2)


After three months of a slight Buyer’s Market, Orange County housing has moved back to a Balanced Market

Back to Balance: With rising demand, the housing market transitioned to a Balanced Market.

Let’s paint a picture. It is the end of the school year and time for thousands to graduate from college and embark on the next chapter in their lives. Arenas and stadiums across the country will bestow degrees to young adults eager to make their mark on the world. Their heads are filled with the highest expectations: instant job offers, the job of their choice, and an attractive salary. Then, reality sets in. They move back in with their parents. Their résumé is distributed to a myriad of companies, but there is no instant offer. Finally, after months of looking, they stumble upon an entry level position that pays very little. It all boils down to unrealistic expectations.

Similarly, sellers in 2019 are experiencing the plight of unrealistic expectations. Many are coming on the market expecting a Seller’s Market in the spring like 2012 through 2018: instant offers, instant success, full price offers, and buyers tripping over themselves to purchase their home. That is just not the Spring Market in 2019. Like college graduates, it all boils down to unrealistic expectations.

Orange County Housing Market Summary:

  • The active listing inventory decreased by 22 homes in the past two weeks and now totals 6,100, almost unchanged. Last year, there were 3,981 homes on the market, 2,119 fewer than today. There are 53% more homes than last year.
  • In January, 2% fewer homes came on the market below $500,000 compared to 2018, and there were 19% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is continuing to vanish.
  • Demand, the number of pending sales over the prior month, soared in the past two-weeks by 356 pending sales, up 25%, and now totals 1,791, its lowest level for this time of the year since 2008. Last year, there were 2,286 pending sales, 28% more than today.
  • The Expected Market Time for all of Orange County decreased from 128 days two weeks ago to 102 days today, a Balanced Market (between 90 to 120 days) and the highest level for this time of the year since 2011. It was at 52 days last year.
  • For homes priced below $750,000, the market is a slight Seller’s Market (between 60 and 90 days) with an expected market time of 80 days. This range represents 44% of the active inventory and 56% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 79 days, a slight Seller’s Market. This range represents 17% of the active inventory and 23% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 112 days, a Balanced Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time decreased from 185 to 144 days. For homes priced between $1.5 million and $2 million, the expected market time decreased from 305 to 209 days. For luxury homes priced between $2 million and $4 million, the expected market time decreased from 314 to 241 days. For luxury homes priced above $4 million, the expected market time decreased from 794 to 582 days.
  • The luxury end, all homes above $1.25 million, accounts for 31% of the inventory and only 14% of demand.
  • Distressed homes, both short sales and foreclosures combined, made up only 1% of all listings and 1.6% of demand. There are only 18 foreclosures and 41 short sales available to purchase today in all of Orange County, 59 total distressed homes on the active market, up 3 from two-weeks ago. Last year there were 39 total distressed homes on the market, slightly less than today.
  • There were 1,461 closed residential resales in January, 19% fewer than January 2018’s 1,800 closed sales. January marked an 18% drop from December 2018. The sales to list price ratio was 96.7% for all of Orange County. Foreclosures accounted for just 0.8% of all closed sales, and short sales accounted for 0.6%. That means that 98.6% of all sales were good ol’ fashioned sellers with equity

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Slight Thaw

February 1, 2019 (Part 1/2)


After an extremely cool December, housing is starting to warm up a bit.

Housing Thaw: With rising demand, the housing market is starting to move its way towards a Balanced Market.

It is a Southern California chilly morning. You climb into your car for the daily commute to the office and blast the heater, but it blows cold air because the engine is not hot yet. Your fingers are numb, and you cannot wait for the temperature to start to rise. After a couple of minutes, the blowing air begins to warm. That is precisely how the housing market starts every year. Housing’s engine is cold on the first of January and takes a few weeks to heat up. This year is no exception, the market is finally starting to warm up a bit.

The housing market in 2019 started off a lot colder than everybody had been accustomed to. It was the coldest start since 2011 with an Expected Market Time of 152 days, Buyer’s Market territory (the Expected Market Time is the amount of time it would take to place a home on the market today and enter escrow down the road). But, in the past couple of weeks, the market began its annual thaw.

ORANGE COUNTY HOUSING MARKET SUMMARY:

    • The active listing inventory increased by 211 homes in the past two weeks and now totals 6,122, a 4% rise. Last year, there were 3,774 homes on the market, 2,348 fewer than today. There are 62% more homes than last year.
    • In 2018, 11% fewer homes came on the market below $500,000 compared to 2017, and there were 26% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly vanishing.
    • Demand, the number of pending sales over the prior month, climbed in the past two-weeks by 270 pending sales, up 21%, and now totals 1,435, its lowest level for this time of the year since 2008. Last year, there were 1,764 pending sales, 23% more than today.
    • The Expected Market Time for all of Orange County decreased from 152 days two weeks ago to 128 days today, a slight Buyer’s Market (between 120 to 150 days) and the highest level for this time of the year since 2011. It was at 64 days last year.
    • For homes priced below $750,000, the market is a Balanced Market (between 90 and 120 days) with an expected market time of 97 days. This range represents 44% of the active inventory and 58% of demand.
    • For homes priced between $750,000 and $1 million, the expected market time is 102 days, a Balanced Market. This range represents 18% of the active inventory and 23% of demand.
    • For homes priced between $1 million to $1.25 million, the expected market time is 156 days, a Buyer’s Market.
    • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time decreased from 252 to 185 days. For homes priced between $1.5 million and $2 million, the expected market time decreased from 365 to 305 days. For luxury homes priced between $2 million and $4 million, the expected market time decreased from 347 to 314 days. For luxury homes priced above $4 million, the expected market time decreased from 1,279 to 794 days.
    • The luxury end, all homes above $1.25 million, accounts for 30% of the inventory and only 13% of demand.
    • Distressed homes, both short sales and foreclosures combined, made up only 0.9% of all listings and 2.1% of demand. There are only 17 foreclosures and 39 short sales available to purchase today in all of Orange County, 56 total distressed homes on the active market, down 11 from two-weeks ago. Last year there were 47 total distressed homes on the market, slightly less than today.
    • There were 1,789 closed residential resales in December, 21% fewer than December 2017’s 2,269. December marked a 12% drop over November 2018. The sales to list price ratio was 96.3% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.7%. That means that 98.9% of all sales were good ol’ fashioned sellers with equity..

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Different Start

January 18, 2019 (Part 1/1)


The start to 2019 is unlike the last 6-years, paving the way for a much different year. There are a lot more homes, demand is down, and the Expected Market Time is at its highest level since January 2011.

2018 fourth quarter was the most sluggish we’ve seen since 2008, with inventory being high and demand low. Now that we’re at the start of 2019, the inventory is a lot higher than what we’re used to. This is due to the fact that the interest rate is favorable. This has generated an increase in online activity, as well as, open houses and showings. Right now we have a Balanced Market, which will lead to a more consistent summer.

ORANGE COUNTY HOUSING MARKET SUMMARY:

  • The active listing inventory increased by 82 homes in the past two weeks and by 346 homes since January 1. It now totals 6,911. Last year, there were 3,707 homes on the market, 2,204 fewer than today. There are 59% more homes than last year.
  • In 2018, 11% fewer homes came on the market below $500,000 compared to 2017, and there were 26% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly vanishing.
  • Demand, the number of pending sales over the prior month, decreased in the past two-weeks by 138 pending sales and now totals 1,165, its lowest level since 2008. Last year, there were 1,447 pending sales, 24% more than today.
  • The Expected Market Time for all of Orange County increased from 134 days two weeks ago to 152 days today, a Buyer’s Market and the highest level since January 2011. It was at 77 days last year.
  • For homes priced below $750,000, the market is a Balanced Market (between 90 and 120 days) with an expected market time of 107 days. This range represents 43% of the active inventory and 61% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 144 days, a slight Buyer’s Market. This range represents 18% of the active inventory and 19% of demand.
  • For luxury homes priced between $1 million to $1.25 million, the expected market time is 176 days, a Buyer’s Market.
  • For luxury homes priced between $1.25 million and $1.5 million, in the past two weeks, the expected market time increased from 211 to 252 days.
  • For luxury homes priced between $1.5 million and $2 million, the expected market time increased from 245 to 365 days.
  • For luxury homes priced between $2 million and $4 million, the expected market time increased from 329 to 347 days.
  • For luxury homes priced above $4 million, the expected market time increased from 941 to 1,279 days.
  • The luxury end, all homes above $1.25 million, accounts for 31% of the inventory and only 13% of demand.
  • Distressed homes, both short sales, and foreclosures combined, made up only 1.1% of all listings and 2.3% of demand. There are only 24 foreclosures and 43 short sales available to purchase today in all of Orange County, 67 total distressed homes on the active market, up two from two-weeks ago. Last year there were 50 total distressed homes on the market, slightly less than today.

There were 1,789 closed residential resales in December, 21% fewer than December 2017’s 2,269. December marked a 12% drop over November 2018. The sales to list price ratio was 96.3% for all of Orange County. Foreclosures accounted for just 0.4% of all closed sales, and short sales accounted for 0.7%. That means that 98.9% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.

 


Orange County Housing Report: A Housing Cold Front

January 18, 2019 (Part 1/1)


A Cold December: With an Expected Market Time of 127 days for all of Orange County, this is the coolest December since 2010.

Brrrr!!! For Southern Californians, when temps drop down to the 40’s at night, it is freezing!! The tap water is cold. Initially, the car is cold for the morning commute. A simple sweatshirt will not do. It feels as if winter has already arrived. That is precisely how the Orange County housing market feels this year.

Notoriously, December is the slowest month of the year in terms of new pending sales. Yet, for years, there simply have not been enough homes on the market. Since 2012, it was still a slight seller’s market in December despite holiday distractions. Demand drops to its lowest point of the year by the end of the month, but so does the active inventory. The muted demand is offset by a drop in supply.

ORANGE COUNTY HOUSING MARKET SUMMARY:

  • The active listing inventory decreased by 425 homes in the past two weeks, its largest drop of the year, and now totals 6,395. Last year, there were 4,023 homes on the market, 2,372 fewer than today.
  • So far this year, 13% fewer homes have come on the market below $500,000 compared to last year, and there have been 26% fewer closed sales. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly vanishing.
  • Demand, the number of pending sales over the prior month, decreased in the past two-weeks by 146 pending sales, and now totals 1,508. Last year, there were 1,864 pending sales, 24% more than today.
  • The Expected Market Time for all of Orange County increased from 124 days to weeks ago to 127 days today, a slight Buyer’s Market (120 to 150 days) and the highest level since January 2011. It was at 65 days last year.
  • For homes priced below $750,000, the market is a Balanced Market (between 90 and 120 days) with an expected market time of 91 days. This range represents 44% of the active inventory and 61% of demand.
  • For homes priced between $750,000 and $1 million, the expected market time is 114 days, a Balanced Market. This range represents 18% of the active inventory and 20% of demand.
  • For homes priced between $1 million to $1.25 million, the expected market time is 155 days, a Buyer’s Market (over 150 days).
  • In the past two weeks, for luxury homes priced between $1.25 million and $1.5 million, the expected market time increased from 182 to 219 days.
  • For luxury homes priced between $1.5 million and $2 million, the expected market time decreased from 222 to 207 days.
  • For luxury homes priced between $2 million and $4 million, the expected market time increased from 397 to 429 days.
  • For luxury homes priced above $4 million, the expected market time increased from 716 to 732 days.
  • The luxury end, all homes above $1.25 million, accounts for 30% of the inventory and only 12% of demand.
  • Distressed homes, both short sales, and foreclosures combined, made up only 1.0% of all listings and 1.9% of demand. There are only 24 foreclosures and 40 short sales available to purchase today in all of Orange County, 64 total distressed homes on the active market, down one from two-weeks ago. Last year there were 60 total distressed homes on the market, slightly less than today.
  • There were 2,025 closed residential resales in November, 17% fewer than November 2017’s 2,427. November marked a 13% drop from October 2018. The sales to list price ratio was 97.3% for all of Orange County. Foreclosures accounted for just 0.5% of all closed sales, and short sales accounted for 0.6%. That means that 98.9% of all sales were good ol’ fashioned sellers with equity.

To request to read/download the full report and charts, please email info(at)echelberger(dotted)com.