Some of the major issues on the minds of Orange County home buyers are what the real estate market in Orange County be in 2019, will the lack of homes improve, and will the competition still be fierce as the past few years?
Orange County Housing Market Could Have More Inventory in 2019
Recent forecasts suggest that home prices will keep climbing in Orange County throughout 2019, though at a slower pace than in previous years.
The prospect of rising prices is basically a continuation of the status quo. Home values in the area have been climbing steadily so for years. So it’s no surprise to see predictions calling for a continuation of that trend in 2019.
Strong housing demand has driven the entire California housing market in 2018 and into the future. A housing crash that many millenials and working poor are longing for is unlikely to happen. In fact, with the added economic activity created by housing construction and larger households, increasing price pressure remains.
But the biggest change happening within the Orange County housing market right now has to do with inventory. For the past few years, the city has experienced a severe shortage of homes for sale. That’s partly why prices have risen so fast. But a series of new reports point to significant inventory growth within the Orange County-area real estate market.
The California Association of Realtors (CAR) predicts a moderate decrease in existing single-family home sales of 3.3 percent next year to 396,800 units sold. CAR sees a slower market with homeowners hanging onto their homes. CAR believes that will subdue sales throughout 2019 along with the pressure of rising interest rates in the coming years.
Orange County’s homeownership rate peaked in 2007 at a rate of 62.7% and has decreased ever since. The most recent homeownership data reports a 56.7% homeownership rate in Orange County. (source: First Tuesday).
Real estate data provider CoreLogic reported that August home sales were down from year-ago levels in all six Southern California counties. Orange County, the region’s most expensive housing market, had the largest decrease. Home sales transactions in were down by 10.9 percent, while San Diego County had an 8.9 percent fall and L.A. County declined by 8.5 percent.
Inventory Showing Sign of Improvement?
The inventory of listed homes increased by 91 since October 15th. Listings are taking on average 45 more days to sell. Trulia reports that inventory in Orange County increased by 20.7 percent fromQ3 of 2017.
It’s been reported that many home buyers are on the sidelines simply waiting due to yearly price increases. With a decreasing pool of buyers, sellers are reducing their asking prices. Approximately 40 percent of California home sellers lowered their asking prices in August. The average price cut for sellers was 4.3 percent.
CAR reported that twenty-nine percent of home sellers this past spring moved out of California, an increase from 19 percent in 2013. Over a third of Southern California home buyers moved to more affordable counties which translates to relocating inland, to the Inland Empire, or they’re going to other Western states such as Arizona, Nevada, and Colorado.
In 2019, people looking to buy a home in Orange County should have a slightly higher inventory to choose from. That’s a positive sign towards the goal of a balanced market. However, overall the housing market will continue to have above average demand for the foreseeable future.
Home Prices Still Rising But Slower
Recent forecasts for home prices in Orange County for 2019 indicate that home prices will continue climbing over the coming months. The same goes for California as a whole.
Related: Orange County vs. Los Angeles home prices
Disclaimer: This article contains data and forecasts provided by third parties outside of our company. Housing and economic forecasts should be regarded as predictions, not a sure thing. Information provided is deemed reliable but not guaranteed.