The Big Story
Quick Take:
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Mortgage rates have ticked up slightly over the course of the past year, and coincidentally, so has the median sale price of a home in the US.
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According to Freddie Mac, the average 30-year mortgage rate is 6.62%, as of April 10th.
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Although affordability remains an issue throughout the country, the median monthly P&I payment has declined by over $100 on a year-over-year basis, representing a considerable savings for consumers!
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We are seeing the trend of more new listings hitting the market continue, as we saw roughly 10% more new listings added in March when compared to a year ago.
Note: You can find the charts & graphs for the Big Story at the end of the following section.
*National Association of REALTORS® data is released two months behind, so we estimate the most recent month's data when possible and appropriate.
Home sales are roughly stagnant compared to last year
Although we are just about to exit the slow season for real estate sales, things are looking great overall. We saw a slight decrease in the number of sales on a year-over-year basis in February, with there being 4,260,000 sales in February 2025, compared to 4,380,000 in February 2024. However, on the flip side, we saw considerably more inventory added this year, with 1,240,000 homes on the market in February of this year, compared to 1,060,000 homes on the market around this time last year.
This means that all over the country, buyers have many more options than in recent years, which may lead to listings sitting on the market for a bit longer than what we’ve seen over the past couple of years. When you couple this with the fact that there are more new listings being added to the market, with just over 10% more listings added in March of 2025, compared to March of 2024, we might see some power start moving away from sellers to the buyers.
Additionally, this uptick in new listings might be an indication that sellers are starting to accept the fact that considerably lower mortgage rates aren’t coming anytime soon. Although many were holding out hope over the course of the past couple of years, the Fed has made it very clear that they’re not looking to drop rates by a considerable margin anytime soon. This, of course, means that prospective sellers have an important choice to make - whether they should sell, or continue holding out. From the data that we’re seeing, it seems that many sellers are beginning to choose the former option!
When turning to affordability, we saw a rather interesting phenomenon - median monthly P&I payments decreased by nearly 5%, all while interest rates and median sale prices increased by just under 4%. This likely means that there was a considerable cohort of homeowners out there that locked in rates toward the end of 2023 when rates were at a local high, and recently refinanced when rates came down a bit. The median consumer having an additional $100 in their pocket each and every month is a great thing for the economy, especially when we face economic uncertainty, tariffs, and ever-changing geopolitics!
Lastly, it’s important to note that it’s business as usual in terms of the Federal Reserve. In their recent FOMC meeting, they decided to hold the federal funds rate firmly where it has been over the past couple of months. Fed officials also indicated that they are not in a rush to lower rates by a considerable margin anytime soon. However, that could always change, as we’re living in an incredibly dynamic era right now! Additionally, the Fed is continuing to offload mortgage-backed securities at a steady pace!
Ultimately though, this is just what we’re seeing at a national level. As we all know, real estate is an incredibly localized industry, so knowing what’s going on in your own market is pivotal. Below is our local lowdown, that outlines everything you need to know about what’s happening around you in your neighborhood and surrounding areas!
Big Story Data
The Local Lowdown
Quick Take:
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Median sale prices continue to grow steadily in Orange County, with a notable 8.56% year-over-year increase in February 2025.
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Inventory levels have surged dramatically, with single-family home inventory showing a 65.93% year-over-year increase.
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The median listing is now spending 23 days on the market, representing a 15% increase compared to the same time last year.
Note: You can find the charts/graphs for the Local Lowdown at the end of this section.
Steady Growth Continues in Orange County's Housing Market
Orange County has maintained its reputation as a strong real estate market, with median sale prices continuing their upward trajectory. February 2025 saw the median single-family home selling for $1,465,500, representing an 8.56% increase compared to February 2024. This follows January's equally impressive 8.33% year-over-year growth. While not reaching the double-digit growth seen in early 2024, the market remains robust and continues to deliver solid appreciation for homeowners.
Inventory Surges to Multi-Year Highs
The Orange County housing market is experiencing a significant surge in available inventory. As of February 2025, there were 2,901 single-family homes on the market, representing a staggering 65.93% increase compared to February 2024. This trend has been building throughout the winter months, with month-over-month inventory growing by 14.17% between January and February 2025. Buyers now have substantially more options to choose from than at any point in the past two years, creating a more balanced negotiating environment.
Homes Taking Longer to Sell as Buyers Exercise Caution
With the influx of inventory, buyers are taking more time to make their purchasing decisions. The median single-family home in Orange County now sits on the market for 23 days before selling, a 15% increase from February 2024. While this is a significant improvement from January's 34-day average (representing a 32.35% month-over-month decrease), it still indicates that buyers are being more selective and taking advantage of increased options. Sellers should adjust their expectations accordingly and prepare for a more patient selling process than in previous years.
Orange County Shifts Toward a Balanced Market
When determining whether a market is a buyers' market or a sellers' market, we look to the Months of Supply Inventory (MSI) metric. The state of California has historically averaged around three months of MSI, so any area with at or around three months of MSI is considered a balanced market. Any market that has lower than three months of MSI is considered a sellers' market, whereas markets with more than three months of MSI are considered buyers' markets.
As of February 2025, Orange County has 3.4 months of supply inventory, which indicates a shift toward a buyers' market. This represents a significant change from a year ago when the market had only 2.5 months of supply, and an even more dramatic change from the 2.0-2.1 months we saw throughout much of early 2024. With inventory continuing to grow and now exceeding the balanced market threshold, buyers are gaining a stronger position in negotiations than they've had in several years.
