Market Talk with Vickie: April 2018
The trend in April has been steady price increases and continuing decline in affordability. April also experienced an upswing in the number of available homes on the market. While the inventory has moved in a positive direction, 2018 numbers are still very low compared to prior years. This month on “Market Talk with Vickie”, we will review the April 2018 Orange County market indicators amid some external factors. For a deeper review on the financial indicators mentioned below, please refer to this prior article.
Is it a buyer’s or seller’s market?
The Months Supply of Inventory (MSI) in April was 3.1 months for detached homes and 2.3 months for attached homes. These numbers have increased from the prior month by 6.9% and 21.1%, respectively. As a 12-month average year-over-year change, the April MSI declined by 15.8% and 17.1% for attached and detached properties. While the MSI figures have shown improvement for buyers, Orange County is still far from a soft market.
Are prices continuing to increase?
The Median Sales Price (MSP) for detached homes in April was $830,000, a $5,000 increase from last month. This marks the third consecutive month of breaking price records! The April MSP for attached homes was also a record breaker at $512,250, exceeding February’s record of $511,000. The 12-month average year-over-year increase is 6.6% and 8.5% for detached and attached properties, respectively. All signs continue to point up as we begin the spring season.
How long will it take for my home to sell?
The Days on Market (DOM) hs been on a steady decline for the past 3 months for both detached and attached homes with April closing at 35 and 27 days, respectively. The year-over-year change for the 12-month average DOM fell 31.9% for detached homes and 39.9% for attached homes. Buyers should be ready to act quickly once they find the right home.
How much of my asking price will I get?
Detached homes in Orange County sold for 98.0% of their original listing price while attached homes sold even higher at 99.1% of the original price. The 12-month average through April is 97.4% and 98.3% for attached and detached homes, and the year-over-year change based on 12-month averages is 0.1% higher for both types of properties.
How affordable is the market?
The Orange County Housing Affordability Index has been on a unwavering decline since January 2018. April set another historical low since November 2007 for both detached and attached properties. In April, the median Orange County household income is 46% and 83% of what is necessary to qualify for the median-priced detached and attached property, respectively, under current interest rates. With interest rates expected to increase in 2018 and prices expected to increase in the spring and summer seasons, we can expect affordability to continue to decline.
How many homes are currently for sale?
April is the first month since late 2017 that Orange County has seen a significant pick-up in inventory. There were 4,709 active listings for detached homes and 2,295 active listings for attached homes, which in total is a 25.8% boost from last month. Inventory is cyclical depending on the time of the year, picking up during the spring and summer months. However, the year-to-year 12-month average is still on the decline of 15.0% and 17.4% for detached and attached properties, respectively.
If you are interested in learning more about a particular city in Orange County or neighborhood in Irvine, send me a message and I’d be happy to share more information with you. All the statistics I mentioned are important to understand as part of your buying or selling strategy. Let me help you get the competitive edge!
Source: Current as of May 10, 2018. Report provided by Orange County REALTORS®. Data © 2018 and provided by CRMLS, Inc as reported by the Orange County REALTORS®. The accuracy of all information is deemed reliable but not guaranteed and should be personally verified through personal inspection by and/or with the appropriate professionals.