Is the Price Right?

The active listing inventory in the past couple of weeks decreased by two homes, nearly unchanged, and now sits at 2,406. In September, 37% fewer homes came on the market compared to the 3-year average before COVID (2017 to 2019), 1,114 less. Last year, there were 3,677 homes on the market, 1,271 more homes, or 53% higher. The 3-year average before COVID (2017 to 2019) was 6,010, or 150% more, more than double.

Demand, the number of pending sales over the prior month, decreased by 51 pending sales in the past two weeks, down 4%, and now totals 1,284, the lowest October reading since 2007. Demand is higher than the prior year for the first time since June 2021. Last year, there were 1,270 pending sales, 1% fewer than today. The 3-year average before COVID (2017 to 2019) was 2,180, or 70% more.

With the inventory nearly unchanged and demand falling, the Expected Market Time, the number of days to sell all Orange County listings at the current buying pace, increased from 54 to 56 days in the past couple of weeks, its highest level since February. It was 87 days last year, slower than today. For homes priced below $750,000, the Expected Market Time increased from 36 to 42 days. This range represents 18% of the active inventory and 25% of demand.

For homes priced between $750,000 and $1 million, the Expected Market Time increased from 35 to 37 days. This range represents 16% of the active inventory and 24% of demand.

For homes priced between $1 million and $1.25 million, the Expected Market Time decreased from 41 to 35 days. This range represents 9% of the active inventory and 14% of demand.

For homes priced between $1.25 million and $1.5 million, the Expected Market Time decreased from 54 to 48 days. This range represents 10% of the active inventory and 11% of demand.

For homes priced between $1.5 million and $2 million, the Expected Market Time increased from 57 to 70 days. This range represents 14% of the active inventory and 11% of demand.

For homes priced between $2 million and $4 million, the Expected Market Time in the past two weeks decreased from 95 to 87 days. For homes priced between $4 million and $6 million, the Expected Market Time increased from 171 to 175 days. For homes priced above $6 million, the Expected Market Time increased from 326 to 385 days.

The luxury end, all homes above $2 million, account for 33% of the inventory and 15% of demand. Distressed homes, both short sales and foreclosures combined, comprised only 0.2% of all listings and 0.3% of demand. Only four foreclosures and no short sales are available today in Orange County, with four total distressed homes on the active market, down one from two weeks ago. Last year, six distressed homes were on the market, similar to today.

There were 1,647 closed residential resales in September, 18% less than September 2022’s 2,011 closed sales. September marked a 17% drop compared to August 2023. The sales-to-list price ratio was 99.4% for all of Orange County. Foreclosures accounted for 0.4% of all closed sales, and short sales accounted for 0.1%. That means that 99.5% of all sales were good ol’ fashioned sellers with equity.