Unsold homes up 57% this year

The number of homes for sale on the Orange County housing market has mushroomed to 11,414 in the 30 days ending last Thursday.

That’s up 57% since “inventory” began a steady rise at the start of the year, according to the latest report by Altera’s Steven Thomas.

Homesellers apparently believed that the housing slump had ended and rushed “to cash in,” Thomas surmised.

“With all of the reports of incredible demand, multiple offers, homes selling at their list prices (or more), and increases in the median sales price, the first six months were marred by a number of homeowners who were duped into thinking that the housing market had recovered and that the time had come to cash in. Too many placed their homes on the market at unrealistic levels. Despite decent demand, the inventory grew from 7,293 homes (in January) to 11,414 today, a 4,121 home increase.”

Thomas calculates a “market time” benchmark tracking how many months it theoretically takes to sell all the inventory in the local for-sale listing service at the current pace of pending deals being made. By Thomas’ logic, as of last Thursday, it would take:

  • 3.84 months (three months 25 days) for buyers to gobble up all homes for sale at the current pace vs. 3.91 months (three months 25 days) two weeks ago. A year ago, it would have taken 2 1/2 months.
  • Homes listed for under a million bucks have a market time of 3.35 months, vs. 9.64 months for homes listed for more than $1 million.
  • The million-dollar market represents 21% of all homes listed and 8% of all homes that entered into escrow in the past 30 days.
  • Thomas reported that demand, as measured by the number of sales contracts signed in the past month, increased by 102 (4%) in the past two weeks, totaling 2,972.
  • That is still 25% off of the end of April’s peak of 3,979.
  • Last year at this time demand was at 3,471 pending sales, 499 more than today.
  • The backlog of pending short sales in Orange County is “dizzying,” Thomas said. “The lenders are in control of the real estate market and they are taking their sweet ol’ time,” he said. Click to read more.

Here’s the recent data, as of last Thursday, for listings; deals pending; market time in months; last Thursday vs. 2 weeks ago, a year ago and 2 years ago (Note: k=thousand; m=million) …

Slice Listings Deals Time (month) 2 week ago 1 yr. ago 2 yr. ago
$0-$250k 1,495 556 2.69 2.86 1.88 3.69
$250k-$500k 3,741 1,317 2.84 2.88 1.30 3.69
$500k-$750k 2,715 640 4.24 4.18 2.39 4.71
$750k-$1m 1,213 225 5.39 4.81 3.97 7.27
$1m-$1.5m 850 166 5.12 6.07 7.26 10.11
$1.5m-$2m 456 48 9.50 12.61 10.28 16.60
$2m-4m 692 21 32.95 21.33 21.37 15.56
$4m+ 373 11 33.91 32.82 49.75 49.71
All O.C. 11,414 2,972 3.84 3.91 2.50 4.88

This article is from the OC Register.

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