Why Orange County Real Estate is STILL INSANE (2024 Review and 2025 Forecast)

Описание: Every month I do a general overview of the OC real estate market - but once a year I do a review of the previous year (including evaluation of that year's forecasts that I made) and a forecast for the upcoming year.

Marketplace Update for December:
Interest rates continued their increase: 6.91% to end the year and that's up from 6.81% to start the month,.

Inventory dropped again
2025 will begin with 2,500 homes available for sale, higher than last year's 1,623 but the 3rd lowest since tracking began 20 years ago.

Demand dropped again
Sales numbers for this time of year are the 3rd lowest since tracking began 20 years ago, but higher than last year's numbers.

Expected market time ended December at 67 - still a seller's market, cooler than last year's number of 53 days.

2024 Review
Forecast #1: Rates down to the mid 5's somewhere in the second half of the year. Actual: lowest rates were at 6.08% in late September.
Forecast #2: Peak inventory at 3,000 to 3,500 homes. Actual: 3,695 peak, slightly higher than I expected.
Forecast #3: Appreciation of 3% - 5% average gain. Actual: 8.3% increase, significantly higher than anticipated.
Forecast #4: Normal inventory/sales cycle (peak sales in the Spring and peak inventory mid-Summer). Actual: sales did peak in the Spring, but peak inventory didn't hit until late September.
Forecast #5: 21,000 to 23,000 in closed sales transactions. Actual: just over 20,000, slightly lower than I anticipated.

2025 Forecast
Forecast #1: Rates between 6.5% to 7% - no real dramatic changes expected.
Forecast #2: Inventory peak of 4,200 to 4,500 homes; a 14% to 22% increase over 2024.
Forecast #3: Appreciation of 3% to 6%; less than 2024's 8.3%
Forecast #4: Same cycle as 2024: peak sales in the Spring and peak inventory in September.
Forecast #5: Sales will be up 7% to 9% compared to 2024, 22,000 to 23,000 sales.

Michael Hausam is a licensed Real Estate Broker. He's been a resident of Orange County, CA since 1990, he funded his first mortgage loan in 1991, has had a B-1 general contractors license since 2005, and he has had his real estate license for over 25 years.

Thank you,