South Orange County Isn't Following the National Market

By Julie & Greg Schnieders

For more than 35 years, Julie and Greg Schnieders have called South Orange County home, giving their clients an understanding of the area that goes far beyond market reports.

Home prices are still rising, yet buyers have more room to negotiate than they’ve had in some time. That combination has many people asking whether we’re finally tipping toward a buyer’s market. Buyers hope it is, and sellers wonder whether they’ve already missed their window.

Everyone wants a simple answer, but the question itself carries a catch. The market described in national headlines isn’t necessarily the market you’re dealing with locally, because national numbers blend markets from across the country. To understand what’s happening in South Orange County, start with the broader picture, then bring it home.

Months of inventory tells the story. One number reliably shows which side has the advantage: months of inventory. It measures how long it would take to sell every home currently on the market if no new listings came on starting today.

In our view, fewer than four months of inventory generally favors sellers, four to six months is more balanced, and anything above six months typically gives buyers the upper hand. Nationally, we’re around 4.6 months of inventory. That places the country in balanced territory, not a buyer’s market. Prices are still up from a year ago, homes are taking a little longer to sell, and buyers have more breathing room.

South Orange County is different. Locally, inventory has run at a fraction of that level throughout the year, and homes are still selling very close to asking. We’re not sitting in the balanced range here, and we’re not particularly close to it.

The reason is straightforward. South Orange County is largely built out, with little new land available to add homes in any significant number. If you’re waiting for local prices to crash so you can step in and secure a great deal, we think it’s important to be realistic about what our market is actually telling us.

Lower rates won’t add inventory. Mortgage rates are just over 7% and have been climbing. It’s completely understandable to think, “I’ll wait until rates come down, then I’ll buy.” The difficulty is that many other buyers are thinking the same thing.

Plenty of people who were priced out last time are watching rates just as closely. If rates do come down, those buyers won’t return one by one. Many will come back at once, and lower rates don’t create more homes for sale in South Orange County.

That means more buyers competing for roughly the same number of homes, and we all know what that can look like: multiple offers, homes selling over asking, and buyers giving up terms and contingencies they would much prefer to keep. You might save money on your interest rate, only to give some of it back through the price or terms of the deal.

Nobody knows exactly where rates are headed, and we’re not predicting that. The point is simple: waiting for a lower interest rate isn’t necessarily the same as waiting for a better deal.

What this means for buyers. The softer national market can actually work in your favor right now. You may have more homes to choose from, more time to decide, and more room to negotiate price, repairs, and other terms. That opportunity exists today, but there’s no guarantee it will last.

What this means for sellers. The central lesson is that you can’t simply put a number on your house and assume buyers will pay it. Even when inventory is tight, pricing still matters. Your home can absolutely sell well, but it needs to be priced for today’s market, not what the house down the street sold for two years ago.

So the next time you see a headline announcing a shift toward a buyer’s market, remember that it may not reflect what’s happening in your neighborhood. The real answer lies in the local numbers.

If you’re thinking about buying or selling in Trabuco Canyon, Mission Viejo, Ladera Ranch, Rancho Santa Margarita, or anywhere else in South Orange County, let’s sit down together and look at what the numbers mean for you. Call or text us at 949-292-5857, email us at julie@schniedersgroup.com, or visit schniedersgroup.com. We look forward to helping you make your next move with the full local picture in front of you.