Active Listings:

Last year, the inventory was 2,076 homes, 11% lower, or 244 fewer. The 3-year average before COVID (2017 through 2019) was 6,002, an additional 3,682 homes, or 159% more, more than double the current level. 

Homeowners continue to “hunker down” in their homes, unwilling to move due to their current underlying, locked-in, low fixed-rate mortgage. For March, 2,285 new sellers entered the market in Orange County, 1,623 fewer than the 3-year average before COVID (2017 to 2019), 42% less. Last March, there were 2,136 new sellers, 7% fewer than this year. A few more sellers are opting to sell compared to the previous year.

Buyer Demand:

Demand, a snapshot of the number of new pending sales over the prior month, increased from 1,648 to 1,707 in the past couple of weeks, up 59 pending sales, or 4%, its highest level since September 2022, surpassing last year’s peak in demand of 1,706 at the end of April, one fewer pending sale. Expect demand to peak shortly as demand closely resembles last year’s path. It will continue to closely mirror 2023 demand until rates drop to the mid-6s with duration. If that were to occur later this year, expect demand to reignite and potentially reach a much later peak. Only time will tell whether or not the U.S. economy cools from here and inflation resumes its downward path, which are the necessary components to an eventual easing in rates as prescribed by the Federal Reserve.