Orange County Real Estate Market Update – January 2022

Orange County real estate for the month of January continued to be a strong seller’s market based on the underlying data

The median sales price of $950,00 in January was up 20.7% compared to prior year.  Prior month, the median sales price was $933,750.

The median price per square foot sold increased to $571 or 24.4% versus prior year and up from $552 prior month.

Inventory reached an all-time low based on 15 years of data with supply of 0.8 months versus 1.5 months last January and up from 0.6 month in December.   A balanced market is typically 3-6 months of supply.  Less than 3 months is a seller’s market and over 6 months is typically a buyer’s market.

The inventory shortage was driven by new listings plummeting 26.6% versus prior year, however, were up versus December as homeowners begin to list their homes for sale after the holiday season.  Closed sales on the other hand, fell 19.8% versus prior year, a result of normal seasonality returning to the market versus 2020, which had had pent up sales and demand coming out of the pandemic.

Average days on market remained steady month-over-month at 8 days and down from 12 days prior January or 33.3%.

The average number of showings per listing remained strong at 10.3, up from 6.9 in December and up from 7.7 or 33.8% last January.  This figure is still well below 2020 average of 5.2 and 1.7 in 2019 and is driven by lack of supply.

Sales to list price of 103.1% was a result of lack of supply and continued strong buyer demand.  In 2020, the sales to list price was 100% and 97.5% in 2019.

Outlook – we continue to have an inventory crisis with strong buyer demand still in the market.  Sales are expected to be strong in 2022 based on forecasts by economists, but price increases should be in the low single digits as rising interest rates (recently touched 4% last week for a 30 year mortgage) will push many buyers out of certain price points and decrease demand.  Until the months of inventory of homes available for sale returns to a more balanced market, seller’s will continue to be in the driver seat.