It has become common knowledge amongst real estate buyers, sellers and agents that most people do their shopping for homes on the internet. And this trend is increasing steadily right across the U.S.
In fact, Realtor.com keeps track of trends of this sort by surveying real estate buyers and sellers. In the case of Orange County, California, their surveys show that online searches for homes in Orange County increased by an impressive 58.9% this fall over 2008.
That may have something to do with the bottom falling out of the housing business a couple of years ago. For example, it could be that since fewer people have been buying for the last two years, there is pent up demand manifesting itself in greater search activity online. Online searches are essentially anonymous, and therefore it is easier to just look in a non-committal way than it is to contact a real estate agent directly and actually go out and look at homes. There may be more searchers, but there are still relatively few buyers.
In any event, increased search activity indicates that people are at least looking, even if they aren’t buying like they once were. Orange County’s impressive looking numbers are actually relatively low compared to other places like Las Vegas (140% increase) and even Los Angeles (68%). That obviously has something to do with the cost of homes in Orange County.
The fact is, Orange County is a very challenging place to buy a home. According to recent statistics the County was the 6th least affordable housing market in the entire U.S. during the 2nd quarter of 2009. That means that even though prices have come down significantly over the last 2 years, they still remain very high in Orange County. And one suspects that many prospective home buyers are waiting for them to come down even more.
A very significant exception to the high cost of homes in Orange County is Laguna Woods Village, a self-contained retirement community with homes of various styles and sizes. Laguna Woods Village has in excess of 370 homes for sale, and the number of homes that have sold over last year at the same time has fallen a full 22%. That is is spite of the fact that Laguna Woods Village is rated among the top 10% “most affordable” communities in the U.S.
Communities are considered “affordable” (or not) by comparing average house prices to average incomes. In Orange County average condo prices were more than $300,000 – $315,528 to be exact at last report. Compare that to the average condo price in Laguna Woods Village: just $200,000 – fully 33% below the Orange County price.
Obviously the last two years have been bad for home owners, real estate developers, builders, real estate agents, mortgage companies, banks, and anybody else even remotely connected with the real estate business. But the fact is, the market is starting to turn around – just as all the unflappable optimists have been saying it would. For example, four months ago listed homes in Laguna Woods were on the market an average of 150 days. In September that number was down to 102 days.
That may not seem very significant to you, but to people who watch the real estate market, it means things are starting to move. That can only mean one thing. All those prices that have plummeted to the bottom are going to start moving up. The fantastic deals that are available right now are soon going to be gobbled up and things will start getting back to normal.