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Your February Market Update

In Southern California, “surf’s up”, is a phrase used to describe favorable conditions of the waves at the beach when they are worth surfing. In describing the Orange County housing market right now, it is a great time to sell a home, and yes, “surf’s up!” If you are a homeowner who wants to sell, but you are waiting for the “Spring Market” because that is when the conditions are “the best” for selling a home, there is no need to wait this year. Grab your surfboard, contact our professional real estate team, and jump in the water… Surf’s Up!

After a slow start to the Winter Housing Market due to fewer active listings at beginning of the month, everything that is coming on the market at fair market value, is now flying off the market almost as quickly as the “FOR SALE” sign is placed in the front yard. Currently, there are simply not enough active listings on the market.

Why is the 2017 Winter Market so favorable when compared to the last few years? Current demand is extremely strong and active inventory is at exceptionally anemic levels. Compared to last year, there are 11% fewer homes on the market right now, and 19% fewer than 2015; yet, demand (new pending sales over the prior month) is almost identical to 2016.

The expected market time (the time it would take to list a home and then place it into escrow) dropped from 84 days in early January to 67 days today. This is because the supply of homes dropped slightly while demand, the new pending sales, exploded.

The only thing keeping demand from being even higher is the lack of inventory. Sellers who opt to sell now are taking advantage of the current market and will experience favorable results. As long as the home is priced close to its Fair Market Value and is in good condition, it will fly off the market. Careful pricing will be vital and will result in selling quickly with strong offers, while stretching the price too much will result in wasting the most valuable market time.

For those opting to “wait until the spring,” there will undoubtedly be more buyers looking to purchase, but there will also be an enormous increase in the number of sellers. With increased demand comes increased supply. Who knows what the market will be like in 90-days. One thing is 100% certain, right now the conditions are perfect for selling.

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Since January 1st, there have been 6% fewer homes that were placed on the market compared to last year at this time. Remarkably, there were 7% fewer homes last year compared to 2015. So, this year there are even more homeowners who are opting not to sell even though the conditions are perfect.

In the past two weeks, the active listing inventory has shed 56 homes, or 1%, and now totals 4,320. This is typically the time of year when more homes are finally coming on the market. The holidays are officially behind us; it is time to for homeowners to take advantage of current wave of demand. The lack of new sellers hitting the market could be due to a “wait and see” attitude. Regardless, there will be a significant increase in supply in February.

As is typical for this time of the year, buyers are chomping at the bit and are eager to move on from the Holiday Market that brings very few choices and not a lot of fresh inventory. Buyers know that is about to change, even though it has been slow going for January.

Demand, the number of homes placed into escrow within the prior month, increased by 368 pending sales in the past couple of weeks, or 24%, and now totals 1,930. Finally, the resilient Orange County housing engine is revving its supercharged engine and will continue to skyrocket as more inventory hits the market.

Contact us and find out how you can take advantage of the market today!

The Steven Thomas Report

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