Orange County California: You would think with all of the continuous negative press over the past 10 months regarding 'Real Estate Bubbles', 'Over Priced California Homes', 'Risky Loans', etc etc... would have caused a substantial negative impact on the Orange County real estate market by now.... but it hasn't. It appears that the simple but powerful economics of lack of supply and strong demand, and a modern day sophisticated consumer who is more then able to draw their own conclusions, has more sway over the markets then the armchair real estate quarterbacks who are doing their best to talk down this market.
One only needs to look at the current months of housing inventory as compared to history to determine the market health of a given area. We have been tracking the Months of Inventory for all cities in South Orange County (Laguna Niguel, Aliso Viejo, Mission Viejo, Lake Forest, Laguna Hills, San Clemente, Dana Point and San Juan Capistrano) since July of 2002, and real estate has been in a sellers market every month here in Orange County since that time, except for the slow month of Decmber which moved into a Neutral market. The months of inventory is simply the amount of time it would take to sell all of the homes on the market, if no new listings were added to the market for sale. The larger the months of inventory, the slower the market and visa versa.
The general rule of thumb, is less than 4 months of inventory is a sellers market, 4 to 6 months is a neutral market, and 6 or more months is a buyers market. House prices trend upward in a sellers market, and prices stagnate or trend lower in a buyers market. Homes and Condos price at $650,000 and less have been hovering around 2 to 4 months of inventory for the past 3 years except for a brief period in the fall of last year. Homes priced from $650K to $850k have faired almost as well... Only homes priced in the $1Mil plus range have reached the point of being a Neutral to a Buyers market with 5 to 7 months of inventory recently. The overall market in all price ranges has cooled down since the peak in April of 2005’, but it still a healthy real estate market, in the face of all of the negative press. With Orange County's low unemployment, lack of buildable land, perfect climate and desirable lifestyle, we expect home prices to hold firm or possibly increase by 5% in 2006’
Content Provider: http://www.my-articles.com
More About Vincent Bindi: Mr. Bindi is a licensed Real Estate Broker in Orange County CA. He’s sold over 700 homes, and has Bachelors and Masters degrees. For more information about www.search-ochomes.com/MissionViejoRE.htm”>Mission Viejo Homes for Sale, visit his website: www.Search-OCHomes.com |
