Just when we expected the Orange County, CA housing market to heat up in early 2025, it threw us a curveball instead. Typically, the first few weeks of the year bring a surge in demand and a gradual rise in inventory, but this year, inventory skyrocketed while demand barely budged. As a result, the Expected Market Time—the number of days it takes to sell a home at the current pace—jumped from 76 to 84 days. To put it in perspective, last year, market time dropped from 62 to 56 days during this period. This kind of shift is not only unusual but hasn’t been seen in nearly two decades.
So, what’s driving this change? More homeowners are finally listing their properties after years of “hunkering down” due to low mortgage rates, leading to a 15% inventory jump in just two weeks. However, buyers aren’t responding at the same pace. Higher mortgage rates, hovering above 7%, have kept many on the sidelines, making affordability a growing concern. While demand did increase slightly—by 4%—it’s nowhere near the levels we typically see this time of year. The last time we saw a similar trend was back in 2014, making this shift a rare occurrence in Orange County’s market history.
For sellers, this means proper pricing and strategic marketing are more critical than ever. Overpriced homes are lingering longer, while competitively priced properties are still moving. For buyers, increased inventory offers more options, but affordability remains a challenge. If mortgage rates drop later in the year, competition could heat up again, making now a potentially strategic time to buy before the market adjusts.
Navigating these market shifts requires expertise and local insight. Whether you're thinking about buying or selling, let’s connect to discuss the best strategy for your real estate goals in 2025. Reach out today, and let’s strategize the best plan for you. Shoot me a text or give me a call at 714-928-4682.
