Jobs, rates, and shrinking inventory—not foreclosures—are steering today’s Orange County real estate market
The Orange County housing market is shifting as we head into fall—inventory is tightening, buyer demand is climbing, and mortgage rates are moving. While there’s been plenty of chatter about foreclosures, today’s market looks nothing like 2008. Back then, weak lending standards pushed more than 5,600 distressed homes onto the market. Today, just eight distressed listings remain—only 0.2% of all homes for sale. With stricter lending, stronger equity positions, and fixed-rate mortgages, homeowners are financially more stable than ever, making a foreclosure wave highly unlikely.
The real story this season is how jobs and interest rates are shaping activity. The labor market is softening, with private payrolls declining and unemployment ticking up—factors that could pressure mortgage rates lower. In September, rates dipped below 6.5% for the first time in months, sparking renewed buyer interest. Active inventory dropped 4% over the last two weeks to 4,576 homes, the steepest decline of the year, while demand rose 1% to 1,609 pending sales—the highest since March. As a result, Expected Market Time tightened from 90 to 85 days, a pace right in line with pre-COVID averages.
For sellers, shrinking inventory means less competition and steady demand for well-priced, show-ready homes.
For buyers, the chance of lower mortgage rates ahead could improve affordability, but it may also bring more competition if rates dip further. Acting now can help you get ahead of that shift. Click to Calculate Your Mortgage Budget
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Tim Smith Real Estate Group are dedicated to helping you find your dream home and assisting with any selling needs you may have. Contact us today to start your home searching journey!
