April Market Update

With today’s higher mortgage rate environment, nobody anticipated buyer bidding wars, but due to extremely low inventory that is exactly what is happening when homes are priced accurately and the home is in great condition. During the first three months of 2023 in Orange County, 45% fewer homes were placed on the market, or 4,538 missing sellers. Homeowners are staying put because of their low, monthly fixed mortgage payment they locked in. As a result, the inventory has dwindled significantly. The inventory has dropped from 2,530 in January to 2,142 today, a 15% drop. The 3-year average before COVID (2017 to 2019) was an increase of 15%, from 4,665 to 5,533. At this point, the lack of home sellers explains the return of multiple offers and sales prices above the asking prices. Where will the market go from here? It all depends upon mortgage rates, which have bounced between a high of 6.75% on March 21st (according to Mortgage News Daily) and a low of 6.38% on March 24th. They are at 6.44% today. The bank closures and the exposed pressures on banking have changed the outlook for mortgage rates, and experts are now projecting a recession between the third and fourth quarters of 2023. Mortgage rates usually fall when the economy slows, especially during a recession.

*statistics provided by Steven Thomas (Reports on Housing)
For more detailed information about the Orange County housing market, click here.