More Home Bargains Are On Orange County’s Horizon
How do I know this? Because, according to this blog post on the O.C. Register’s Lansner on Real Estate blog, 43.3% of homes on the market in Orange County are distressed — that is, either REOs or short sales. Whoa!
At the same time last year, the same source — Steve Thomas of Altera Real Estate — reported that distressed properties made up just 12% of the O.C.’s housing inventory. That’s a huge jump in just 12 months.
Many of the short-sale homes will no doubt enter foreclosure, then come back on the market at greatly reduced prices. This means that prices have farther to fall, and that there will no shortage of bargains on the market in the next one to two years, at least.
Not surprisingly, distressed properties are highest in the less-popular areas and lowest in the most sought-after areas. Here’s a chart from the blog with more details. Some highlights:
- 64% of all O.C. homes for sale under $500,000 are distressed. The percentage decreases dramatically as the sales price rises: For example, only 20% of homes priced between $500K and $750K are distressed.
- The cities with the most distressed properties are Santa Ana (79%), Anaheim (75%) and Garden Grove (71%). The cities with the least: Corona del Mar (2%) and Seal Beach (3%).
- Condos and townhomes (51%) are more distressed than single-family homes (39%).
Three-quarters of all homes for sale in Santa Ana and Anaheim are distressed? That’s a huge number. You can see the enormity of the situation yourself if you go to redfin.com and type in an Anaheim or Santa Ana ZIP code. It will take no time at all to find properties that are listed for hundreds of thousands less than just two years ago. Like this Anaheim house, sold for $535,000 three years ago and now on the market for $309,000.
Sad for the people who are losing their homes, but good news for those who are priced out. The overpriced and underwater homes have to work their way out of the market before it can return to any kind of normalcy.
Recent Redfin posts:
The Evolving IBC—Diamond Jamboree Center Comes to Irvine’s Live-Work-Play District
Just How Bad Is It?
Tustin: Follow-Up on New Parking Ordinances
Max D. said:
“Three-quarters of all homes for sale in Santa Ana and Anaheim are distressed? That’s a huge number.”
Huge number? Yes. Surprising? No, considering the population of Santa Ana and Anaheim. It’s a microcosm of what went wrong with the mortgage-lending industry.
October 9, 2008 3:11 PM
BH in HB said:
No one is selling unless they have to. It is either a distressed sale, or a sale caused by job change, death, relocation, etc. Those who do not have to sale tend to keep the property as their personal residence or as a rental. Many properties that are not selling are hitting the rental market.
October 9, 2008 3:43 PM
ellem said:
We’re grimly watching events unfold in the US from our vantage point overseas . . . yet, filled w/ an optimistic sense of hopefulness, continue to save our money because for every “family forced out of their home” there is another family who will do their research and make sure they can actually afford what they are buying . . . .
October 10, 2008 4:24 AM
Kimberly said:
The Orange County Realtor that I work with has shown me this same information. As a buyer I think this is great and I know that she’s going to help my wife and I find a great first home. As these homes become more affordable more people will start buying homes again. I don’t think the market’s hit that sweet spot yet but it’s getting close.
October 10, 2008 10:33 AM
Talyssa said:
woohoo! I know people are losing their homes, but they will find a place to live (maybe they’ll have to rent like I’ve been) and in the meantime housing prices MUST correct in OC. In fact I believe we’re due for a slight overcorrection as a largeish chunk of the population is coming out of this crisis with lousy credit — and another largish chunk just has not so great credit regardless.
I went househunting this weekend and I REALLY need to see news like this after that. We see places we like that we could actually afford… but why catch a falling knife?
October 13, 2008 4:58 PM