Inventory has finally started to rise in Orange County as well as the rest of Southern California. Inventory bottomed out in March which means we are now in the Spring market for housing so from here through the end of Summer/early Fall we should see available homes continue to rise. On the demand side, we did see a slight drop over the last few weeks which is due to 1) The typical housing cycle where demand flattens out this time of year 2) Interest rates were climbing though the month of March which lead to more buyers sitting on the sidelines and not entering the market. So what does this mean for May’s housing market? Interest rates have actually decreased again during April so although I expect this to be a temporary drop, it should lead to a slight bump in demand as buyers try to take advantage of what is most likely the last time they will see interest rates under 3% for the rest of the year(this prediction for demand increase is also supported by the data showing mortgage applications are again on the rise after 6 weeks of declines). By the end of May I expect interest rates to continue their climb upwards again as long as the economic news continues to be positive.
7 things to know about the current housing market in Orange County:
- Supply has increased by 6% over the last two weeks
- Demand has decreased by 3% over the last two weeks
- Interest rates have fallen in April and are currently hovering at an average of 2.97% for a 30-year fix mortgage loan
- 2/3 of all homes sold right now are closing above asking price
- Expected market time has gone from 21 to 23 days
- After 6 weeks of declines, mortgage applications are up again by 8.6% this week
- Covid cases in OC are currently at 3 per 100,000 residents and OC has a positive test rate of only 1.4% which is a new low since tracking begin last year.