Hot Seller’s Market
With a record low supply of homes available to purchase and staggering demand, the market is extremely hot.
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.
The housing market has been fueled by mortgage rates. When mortgage rates climb, monthly payments rise, affordability erodes, and the market slows. When mortgage rates fall, monthly payments drop, affordability improves, and the market heats up. With each of the 17 record low rates achieved in the past 10-months, housing has grown hotter. The record low mortgage rate environment has persuaded more buyers to enter the housing arena. For a $700,000 mortgage, the ORANGE COUNTY HOUSING REPORT | Blazing Beginning payment is $2,820 at today’s 2.65% rate, compared to $3,230 last year at 3.72%, a $410 per month savings, or $4,920 annually.
ATTENTION BUYERS: Waiting for the market to get easier for buyers is not the answer.
Home values are on the rise and mortgage rates are projected to climb as well. Values are slated to rise between 6 to 8% in Orange County, and mortgage rates will start the year at record low levels but could reach 3.5% by the end of the year. With rising values and higher rates, payments rise and home affordability will slowly erode. For buyers, waiting is not an option.
ATTENTION SELLERS: Pricing close to a home’s Fair Market Value is fundamental to obtain the highest possible net proceeds.
Overpricing in today’s market is not advisable and will only result in fewer showing and fewer offers. The key to tapping into the current Hot Seller’s Market is to take advantage of the hordes of buyers waiting for more homes to hit the market. A realistic price will attract mult
Click on the image below the Read the Orange County Housing Report.
