Costa Mesa Real Estate Update: Why Foreclosures Aren’t Flooding the Market
If you’ve been hearing talk about a wave of foreclosures coming to Orange County, let’s clear that up right now: there is no flood of foreclosures on the horizon. In fact, the housing market today looks nothing like it did during the Great Recession. Back then, risky loans and loose lending rules caused thousands of distressed properties to hit the market. But in 2025, lending has been much stricter for over a decade, and most homeowners have strong credit, stable jobs, and lots of equity.
Here in Costa Mesa and across Orange County, the numbers tell the real story. Right now, there are only eight distressed properties (foreclosures and short sales combined) out of 4,576 total homes for sale. That’s just 0.2% of the market — a tiny fraction compared to the thousands we saw during 2008. Even when foreclosure activity rises a little, it’s simply a return to normal pre-pandemic levels, not a market crash.
At the same time, the overall housing market is showing strength. Inventory dropped by 182 homes in the past couple of weeks, while buyer demand in Orange County increased slightly to 1,609 pending sales — the highest level since March. This has brought the Expected Market Time down to 85 days, meaning homes are still moving, especially in desirable cities like Costa Mesa. With mortgage rates hovering near 6.25%, affordability is improving, and buyers are stepping back into the market.
For Costa Mesa homeowners, this means stability. You don’t have to worry about a flood of distressed homes driving down property values. For buyers, it’s a sign of confidence — investing in Costa Mesa real estate continues to be a smart long-term move. With strong equity, limited supply, and steady demand, our local market is positioned for balance, not collapse.
