‘Seller drought’ frustrates O.C. housing market, supply 3% below 2015
From Jonathan Lansner of the Orange County Register, 3/1/2016
“Orange County’s housing inventory maven, Steve Thomas, isn’t mincing words: “Seller Drought” is how he titled his latest biweekly newsletter.
ReportsOnHousing.com notes the number of homes listed on local brokers’ networks increased by 298 homes, or 6 percent, in two weeks to 5,271 on Feb. 25. Thomas notes this was the largest jump in supply since May 2014.
So why does Thomas think inventory is so slim, a shortage that frustrates house hunters?
Well, supply growth in January was 9 percent below 2015 levels and even with the recent burst in listing activity, inventory is still 3 percent off a year ago and far below the historic average supply of 9,200 homes for sale.
“Essentially, the low inventory is preventing would-be sellers from coming on the market, which only exasperates the problem,” Thomas wrote.
ReportsOnHousing.com notes that demand, the number of new pending sales over the prior month, increased by 242 homes in two weeks to 2,584 on Feb. 25, the highest since September 2015. Still, demand is down 11 percent in a year, partly due to limited selection for house hunters.
Thomas calculated “expected market time” – how long it would take current inventory to sell at pace of demand – 61 days on Feb. 25. That’s up from 56 days a year ago but better than 66 days two years ago.” ( End of Jonathan’s article.)
From Bob Phillips: We are now one month into this year’s “Spring selling season” when the number of homebuyers starts to grow with a vengeance. That growing number of buyers needs something to buy, and if the local housing inventory doesn’t start to grow soon, there will be an increasing likelihood of multiple buyers for each nice house to come upon the market, which translates to increasing prices.
In 2013, local home prices went up more than 15% between February 1st, and July 31st, our typical “buying season”. That’s the LAST thing today’s homebuyers need, so hopefully the number of homes available will start increasing, to match the number of buyers.
Keep your fingers crossed and watch this space.