Orange County California: I thought for sure with all of the continuous negative press  for the past 5 months regarding 'Real Estate Bubbles', 'Over Priced California Homes', 'Risky Loans', etc etc... this would have had a very negative impact  on the market by now.... but it hasn't.  It appears that the simple but powerful economics of lack of supply and strong demand, and a modern day sophisticated consumer who is more then able to draw there own conclusions, take priority over the armchair real estate quarterbacks who are doing their best to talk down this market.

One only needs to look at the current months of housing inventory as compared to history to determine the market health of a given area.  We have been tracking the Months of Inventory for all cities in South Orange County (Laguna Niguel, Laguna Beach, Aliso Viejo, Mission Viejo, Lake Forest, Laguna Hills, San Clemente, Dana Point and San Juan Capistrano) since July of 2002, and real estate has been in a sellers market every month here in Orange County since that time. The months of inventory is simply the amount of time it would take to sell all of the homes on the market, if no new listings were added to the market for sale.  The larger the months of inventory, the slower the market and visa versa. 

The general rule of thumb, is less than 2 months is a Hot sellers market, 2 to 4 months is a sellers market, 4 to 6 months is a neutral market, and 6 or more months is a buyers market.  House prices trend upward in a sellers market, and trend lower in a buyers market.  Homes and Condos price at $650,000 and less have been hovering around 2 months or less of inventory for the past 3 years except for a brief period in the fall of last year.  Homes priced from $650K to $850k have faired almost as well...  Only homes priced in the $1Mil plus range have reached the point of being a Neutral market with almost 5 months of inventory currently.  The overall market in all price ranges has cooled a little bit from the peak in April of this year, but it still a healthy real estate market, in the face of all of the negative press.

To view Homes for Sale in Orange County CA, simply click on the following link: Orange County Real Estate.

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