By JONATHAN LANSNER
THE ORANGE COUNTY REGISTER
It seems Orange County house sellers partially got the message.
One of the most curious aspects of the current upturn in the local housing market has been the reluctance of property owners to join the party. Thus, we’ve seen a buying surge go on with supply of homes for resale at ridiculously low levels.
That makes the big question for the spring shopping season: “Will there be enough supply?”
An early hint about the mindset of those willing to enter the market with Orange County homes shows a bet that shoppers will pay up.
That curious view of the Orange County housing market comes from DeptofNumbers.com, tracking trends in asking prices from brokers’ MLS system of homes for sale.
The overall Orange County median listing price, by this math, was $449,500 – up 13.3 percent vs. a year ago, the ninth gain by annual measure. Clearly, sellers are targeting deeper-pocketed buyers, though I’ll note that this price benchmark has been flat since November. (Perhaps seasonality of the slow holiday selling season?)
In addition, DeptofNumbers breaks down its data into a pair of neat markers – the 25th and 75th percentiles that let us see how the market’s upper crust and more modest abodes are faring. Note: This report shows 40 percent fewer homes for sale in Orange County than a year ago.
From the January report, we see the results of what we hear are literal battles for cheaper homes.
At the 25th percentile – the median of the lower half of the price spectrum of local homes for sale – asking price was $312,500. That is up 1.26 percent vs. the previous month. This is the 11th month-to-month gain out of the past 12 in pricing at the lower end and leaves the 25th percentile price up 13.6 percent in a year.
Prices are up at the 75th percentile, too.
The median of the upper half of the price spectrum of local homes for sale was $713,238 – up 17.9 percent vs. a year ago. Note: This benchmark has fallen in four of the last five months. (Perhaps a sign that upper part of the market isn’t as tight as the bottom?)
Rising prices are both good and bad.
As values rise, homeowners will regain equity in their homes that was wiped out during the great real estate debacle.
For one, those paper gains could be a boost to overall economic confidence. Who could complain about that?
For those homeowners who have deferred a sale hoping to get a better price, this jump may nudge them to sell. That could bring more supply to the market – lessening some of the current manic house shopping and increasing sales volumes. That’s good for shoppers and those in the real estate transaction game.
But rising prices have a dark side.
Orange County is already an expensive place to live. Pricier homes only make it that much tougher financially – and despite all the political rhetoric about what’s wrong with California, expensive housing is a key (and underdiscussed) part of that debate.
Rising home prices and Orange County logic don’t mix well. Jumping home prices in the past have brought out the worst of human nature – from buyers and sellers to industry professionals.
Hopefully lessons of past pain – like the risks of ownership, especially for those who shouldn’t – have been learned.
Sadly, after a quarter-century here, if I had to bet on one thing in real estate, it’s that stupidity could easily return.