Demand for Orange County Residential Real Estate Picks Up
Category : Laguna Beach Real Estate
Spring may be awakening in demand for Orange County residential real estate. Supply also increased, but at a slower rate than the expanding demand. At www.OC180NEWS.com, we run the numbers for the two weeks ended March 18, 2010.
After a disappointing slump two weeks ago, demand returned to, and moderately exceeded, the demand levels of four and six weeks ago. OC residential real estate demand for the most recent two weeks, the period ending 3/18/2010, was 3,270 units. Two weeks ago, it had dipped to 3,054, which was down from 3,244 in the previous period.
This level of demand, however, is well ahead of demand during the start of last year, when it did not break through the 3,000 ceiling until the first part of April. It continued to expand until peaking at 3,652 homes in mid June. Demand gradually tapered off after that time.
Not only was demand less last year, but it came with many more homes on the market than today. On March 19, 2009, there were 11,606 homes in the inventory of active real estate listings. As of 3/18/2010, there were only 8,776 homes on the market in Orange County. Thus, the estimated average time a house might be on the market, known as market time, last year was 4.35 months. Now, it is down to 2.68 months, a strong seller’s market.
The other important gage we watch here at www.OC180NEWS.com is the number and percentage of distressed homes in the inventory of active listings. The number of distressed units edged up slightly in the most recent two weeks to 2,795, an increase of 26 units. But, this nearly negligible increase, when compared to the 3.9% increase in total active listings, produced another drop in the percentage of distressed homes in inventory. It fell to 31.8%., down from 32.8% two weeks ago. It still has a ways to go to equal the low point of 29.4% achieved in mid July 2009, but the percentage has been falling steadily since early January, 2010, when it hit 35.0%.
Unfortunately, this recent decline in the percentage of distress homes in inventory has not been because the number of distressed homes has declined. Rather, it is because total inventory of active listings has increased at a faster rate. Back in the beginning of this year, when the percentage hit its recent peak, the number of distressed units in the active inventory was 2,555. Today, there are 2,795 distressed homes on the market in Orange County. While this increase is relatively small, it has been steady since the beginning of this year.
As employment stabilizes in Orange County (see our exclusive article on OC’s January employment gain) perhaps the actual number of distressed homes coming on the market will begin to decline. As it stands right now, there is no sign of a flood of new foreclosures, but there clearly is a rising tide of distressed properties coming on the market in Orange County.