- The Orange County Housing Market saw its first drop in both price and the number of home sales since May of 2020 in September, Zillow declared it will stop flipping houses after taking some massive losses on its home sales, and interest rates are beginning to creep back up over 3%. I’m Tim Hamilton with StellarQuest Real Estate and this is our Orange County Housing Market Update for November. If you’re thinking about buying or selling a home please feel free to call or text me at (714) 486-4086. I would be happy to answer your questions and help you get the started with buyer or selling a home. To stay up to date on the housing market make sure you subscribe to our YouTube channel.
- The Orange County Register just published an article by Jonathan Lasner where he pointed out we experienced the first double dip since May of 2020. By double dip he is referring to the fact that in September we experienced a drop in both price and number of homes sold compared to the previous month. Lasner also makes a great point about affordability in his article. To quote him “at these rates, a buyer with 20% down would pay $2,952 a month on the latest $890,000 median vs. $2,723 on February 2020’s $748,500 median. So during the pandemic era, sale prices rose 19% but just 8% for a theoretical house payment.” End quote. This is possible due to the low interest rate environment that we have been experiencing. Mortgage payments have not risen nearly as much as home prices.
- For the reasons I just discussed, low interest rates have played a critical role in the incredible home value appreciation we have experienced over the past year and a half. In his most recent “Orange County Housing Report” Steven Thomas explains why he believes rising interest rates could be the catalyst in a housing market slowdown. He looks back to 2013 and 2018, which were both years that started with a very low supply of homes for sale, and were in a HOT sellers market. During both of those years interest rates rose, the supply of homes began to build, and the market cooled. Steven Thomas believes interest rates would need to reach about 4% in today’s market to have a similar effect. The good news for homeowners is that many experts are not expecting 4% interest rates in the immediate future. Freddie Mac recently forecasted that interest rates would rise to about 3.5% in roughly a year from now.
- It looks like Zillow has decided to stop flipping houses. They apparently drastically overpaid on many of its home acquisitions and are taking some pretty substantial losses. When the news was first released it appeared they were simply going to put the flipping aspect of their business on pause, but now they have announced they will be exiting the business all together and laying off a quarter of their staff. Zillow has become the latest example of failed companies that have tried to eliminate real estate agents from the home buying and selling process. You can’t replace the level of customer service we provide, the local real estate experience and knowledge we offer, and the care we show our clients with a computer algorithm.
- Thank you for watching! If you’re thinking about buying or selling a home in the Orange County area please feel free to call, text, or email me anytime. My personal cell phone number is in the description below. If you want to read any of the article or information we referenced in the video please let me know and I will send it over to you. If you want to stay up to date on the housing market and a variety of other real estate related topics please subscribe to our YouTube Channel.
StellarQuest Real Estate – Lic. # 02077900
Tim Hamilton
Broker Associate – Realtor®
Lic. #01959966
(714) 486-4086
timsellsca@gmail.com
www.StellarQuest.com