Michael Shahabi, Associate Broker - Keller Williams

06/12/2022

07/08/2019

https://tours.virtuance.com/1356615

Virtual Tour of 156 Firefly, Irvine, CA.

04/19/2017

APRIL, 2017

HOUSING REPORT: BEST TIME TO SELL

--The active listing inventory increased by 300 homes, or 6.4%, in the past couple of weeks, it is the
largest rise since January 2014. It now totals 5,016, eclipsing the 5,000 home mark. Last year, the inventory hit this milestone in mid-February. While, this year has had a slower start in terms of inventory coming on the market, that all changed two weeks ago. The trend of fewer homeowners coming on the market compared to last year has ended.

--There are 41% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 23%. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly disappearing.

--Demand, the number of pending sales over the prior month, exploded by 11% in the past couple of weeks, increasing by 293 and now totals 2,957, knocking on the door of 3,000 pending sales, typically a sign that the hottest time of the year has arrived. Today’s demand is 1% lower than last year when it totaled 2,999. The average pending price is $865,446.

--The average list price for all of Orange County dropped from $1.7 million two weeks ago to $1.6 million today. This number is high due to the mix of homes in the luxury ranges that sit on the market and do not move as quickly as the lower end.

--For homes priced below $750,000, the market is HOT with an expected market time of just 31 days. This range represents 37% of the active inventory and 61% of demand.

--For homes priced between $750,000 and $1 million, the expected market time is 48 days, a seller’s market (less than 60 days). This range represents 19% of the active inventory and 20% of demand.

--For luxury homes priced between $1 million to $1.5 million, the expected market time is at 81 days, decreasing by 5 in the past couple of weeks. For homes priced between $1.5 million to $2 million, the expected market time decreased from 116 to 110 days. For luxury homes priced above $2 million, the expected market time decreased from 235 to 202 days.

--The luxury end, all homes above $1 million, accounts for 44% of the inventory and only 19% of demand.

--The expected market time for all homes in Orange County dropped from 53 days to 51 in the past couple of weeks, a solid seller’s market (less than 60 days). From here, we can expect the market time to slowly rise throughout the Spring and Summer Markets.

04/19/2017

April, 2017

HOUSING REPORT: BEST TIME TO SELL

--The active listing inventory increased by 300 homes, or 6.4%, in the past couple of weeks, it is the
largest rise since January 2014. It now totals 5,016, eclipsing the 5,000 home mark. Last year, the inventory hit this milestone in mid-February. While, this year has had a slower start in terms of inventory coming on the market, that all changed two weeks ago. The trend of fewer homeowners coming on the market compared to last year has ended.

--There are 41% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 23%. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly disappearing.

--Demand, the number of pending sales over the prior month, exploded by 11% in the past couple of weeks, increasing by 293 and now totals 2,957, knocking on the door of 3,000 pending sales, typically a sign that the hottest time of the year has arrived. Today’s demand is 1% lower than last year when it totaled 2,999. The average pending price is $865,446.

--The average list price for all of Orange County dropped from $1.7 million two weeks ago to $1.6 million today. This number is high due to the mix of homes in the luxury ranges that sit on the market and do not move as quickly as the lower end.

--For homes priced below $750,000, the market is HOT with an expected market time of just 31 days. This range represents 37% of the active inventory and 61% of demand.

--For homes priced between $750,000 and $1 million, the expected market time is 48 days, a seller’s market (less than 60 days). This range represents 19% of the active inventory and 20% of demand.

--For luxury homes priced between $1 million to $1.5 million, the expected market time is at 81 days, decreasing by 5 in the past couple of weeks. For homes priced between $1.5 million to $2 million, the expected market time decreased from 116 to 110 days. For luxury homes priced above $2 million, the expected market time decreased from 235 to 202 days.

--The luxury end, all homes above $1 million, accounts for 44% of the inventory and only 19% of demand.

--The expected market time for all homes in Orange County dropped from 53 days to 51 in the past couple of weeks, a solid seller’s market (less than 60 days). From here, we can expect the market time to slowly rise throughout the Spring and Summer Markets.

04/19/2017

HOUSING REPORT: BEST TIME TO SELL

--The active listing inventory increased by 300 homes, or 6.4%, in the past couple of weeks, it is the
largest rise since January 2014. It now totals 5,016, eclipsing the 5,000 home mark. Last year, the inventory hit this milestone in mid-February. While, this year has had a slower start in terms of inventory coming on the market, that all changed two weeks ago. The trend of fewer homeowners coming on the market compared to last year has ended.

--There are 41% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 23%. Fewer and fewer homes and condominiums are now priced below $500,000. This price range is slowly disappearing.

--Demand, the number of pending sales over the prior month, exploded by 11% in the past couple of weeks, increasing by 293 and now totals 2,957, knocking on the door of 3,000 pending sales, typically a sign that the hottest time of the year has arrived. Today’s demand is 1% lower than last year when it totaled 2,999. The average pending price is $865,446.

--The average list price for all of Orange County dropped from $1.7 million two weeks ago to $1.6 million today. This number is high due to the mix of homes in the luxury ranges that sit on the market and do not move as quickly as the lower end.

--For homes priced below $750,000, the market is HOT with an expected market time of just 31 days. This range represents 37% of the active inventory and 61% of demand.

--For homes priced between $750,000 and $1 million, the expected market time is 48 days, a seller’s market (less than 60 days). This range represents 19% of the active inventory and 20% of demand.

--For luxury homes priced between $1 million to $1.5 million, the expected market time is at 81 days, decreasing by 5 in the past couple of weeks. For homes priced between $1.5 million to $2 million, the expected market time decreased from 116 to 110 days. For luxury homes priced above $2 million, the expected market time decreased from 235 to 202 days.

--The luxury end, all homes above $1 million, accounts for 44% of the inventory and only 19% of demand.

--The expected market time for all homes in Orange County dropped from 53 days to 51 in the past couple of weeks, a solid seller’s market (less than 60 days). From here, we can expect the market time to slowly rise throughout the Spring and Summer Markets.

03/14/2017

Orange County Housing Report: The Squeeze on Housing

March 12, 2017

As rates rise, the price of a home that a buyer is able to afford drops
considerably, especially in the higher price ranges.

The Squeeze on Affordability: With interest rates expected to rise, today’s low rates provide buyers the opportunity to afford quite a bit more home.
The United States economy is finally revving its massive engine. Jobs are beating expectations; unemployment has fallen to near pre-recession levels; wages are rising at the fastest pace in years; and, inflation is on the rise. In addition, the new, Trump administration is planning to ramp up infrastructure spending, lower taxes, and focus on jobs, all heavily contributing to much higher inflation expectations. As a result, the Federal Reserve is expected to once again raise the Federal Funds rate this week, which has already had an impact on mortgage rates, rising to a 2017 height.

With all of this positive economic news, what does it mean for the future of interest rates? The historically low 3.5% mortgage rates are officially in the rearview mirror, a chapter in the history books of the housing recovery. Buyers should not wait around for those rates to return. Instead, cashing in on today’s mortgage rate, still historically low, is a wise strategy.

Unfortunately, everybody has become accustom to a low interest rate environment. For proper perspective, in 1990 the interest rate was at 10%. In 2000, it was at 8%. Moreover, just prior to the Great Recession, the interest rate was at 6.4%. No, today’s rates are not as low as last October, but they are still a bargain compared to where they have been over the past 50 years.

It is imperative that buyers understand that the longer they wait to purchase, the greater the risk that rates will rise. As they rise, affordability erodes. For example, if a buyer can afford a $2,500 monthly mortgage payment with 20% down, they could have purchased a $667,000 home last October with a 3.5% rate. Today, with conventional rates at 4.375%, the purchase price drops to $600,000. As rates rise further, purchasing power continues to crumble. At 4.75%, the $2,500 payment buys a $575,000 home. At 5%, it drops to $558,000. And, at 5.25%, it becomes a $542,000 home, $125,000 less than five-months ago.

For jumbo loans, loans above $636,150, today’s rates are at 4.75%. They were at 4.375% just prior to last November’s presidential election. As a result, if a buyer can afford a mortgage payment of $4,500 per month, they are looking at a $1,034,000 home today compared to a $1,081,000 home back in October. Similarly, as rates rise to 5% and then 5.25%, the purchase price contiues to drop. At 5.25%, it becomes a $978,000 home, $103,000 less than five-months ago.

The current Orange County housing market is sizzling hot with very low inventory and demand through the roof. A lot of what is driving demand is the desire to jump on today’s historically low interest rates before they rise, grinding down a buyer’s purchasing power. Securing a low rate now allows buyers to get more house for their money.

02/13/2017

Orange County Housing Market Summary:

The active listing inventory dropped by 56 homes in the past couple of weeks, a 1% drop, and now totals 4,320. The drop was unprecedented for this time of the year and is most likely due to fewer homes coming on the market so far in 2017, down 6% from last year. The inventory should increase from here, peaking sometime during the summer.

--There are 32% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 16%. Fewer and fewer homes and condominiums can now be found priced below $500,000. It is the price range that is slowly disappearing.

--Demand, the number of pending sales over the prior month, skyrocketed by 24% in the past couple of weeks, adding an additional 368 and now totals 1,930. Today’s demand is almost identical to last year when there were just 6 additional pending sales. The average pending price is $871,107.

--The average list price for all of Orange County is $1.6 million, identical to two weeks ago. This number is so high due to the mix of homes in the luxury ranges that sit on the market.

--For homes priced below $750,000, the market is HOT with an expected market time of just 42 days. This range represents 42% of the active inventory and 67% of demand.

--For homes priced between $750,000 and $1 million, the expected market time is 73 days, a slight seller’s market (between 60 and 90 days). This range represents 18% of the active inventory and 16% of demand.

--For luxury homes priced between $1 million to $1.5 million, the expected market time is at 98 days, dropping by 49 in the past couple of weeks.

--For homes priced between $1.5 million to $2 million, the expected market time increased from 169 to 195 days.

--For luxury homes priced above $2 million, the expected market time decreased from 370 to 277 days.

--The luxury end, all homes above $1 million, accounts for 40% of the inventory and only 17% of demand.

--The expected market time for all homes in Orange County drastically dropped in the past couple of weeks from 84 to 67, a slight seller’s market (between 60 and 90 days).
Distressed homes, both short sales and foreclosures combined, make up only 2.1% of all listings and 3.9% of demand. There are 38 foreclosures and 53 short sales available to purchase today in all of Orange County, that’s 91 total distressed homes on the active market, 21 fewer than two weeks ago and the lowest total since prior to the Great Recession. Last year there were 159 total distressed sales, 74% more.

--There were 2,474 closed sales in December, a 1% increase from November, and nearly identical to the 2,746 sales that closed in December 2015. The sales to list price ratio was 97.3% for all of Orange County. Foreclosures accounted for just 1.25% of all closed sales and short sales accounted for 1.25% as well. That means that 97.5% of all sales were good ol’ fashioned equity sellers.
Have a great week.

01/24/2017

Orange County Housing Market Summary:

• The active listing inventory increased by 7% since January 1st, adding an additional 305 homes and now totals 4,376. It’s the first increase since July 2016. The inventory will continue to increase from here, peaking sometime during the summer.
• There are 25% fewer homes on the market below $500,000 compared to last year at this time and demand is down by 13%. Fewer and fewer homes and condominiums can now be found priced below $500,000.
• Demand, the number of pending sales over the prior month, decreased by 4%, or 66, since January 1st and now totals 1,562. Today’s demand is 2% fewer than last year. The average pending price is $794,770.
• The average list price for all of Orange County is $1.6 million, dropping from $1.7 million at the end of December.
• For homes priced below $750,000, the market is HOT with an expected market time of just 55 days. This range represents 45% of the active inventory and 69% of demand.
• For homes priced between $750,000 and $1 million, the expected market time is 90 days, an equilibrium market that does not favor sellers or buyers (between 90 and 120 days). This range represents 17% of the active inventory and 16% of demand.
• For luxury homes priced between $1 million to $1.5 million, the expected market time is at 147 days, increased by 15 in the past couple of weeks. For homes priced between $1.5 million to $2 million, the expected market time remained the same at 169 days. For luxury homes priced above $2 million, the expected market time increased from 345 days to 370 days.
• The luxury end, all homes above $1 million, accounts for 39% of the inventory and only 15% of demand.
• The expected market time for all homes in Orange County increased in the past couple of weeks from 75 days to 84, a slight seller’s market (between 60 and 90 days).
• Distressed homes, both short sales and foreclosures combined, make up only 2.6% of all listings and 3.6% of demand. There are 42 foreclosures and 70 short sales available to purchase today in all of Orange County, that’s 112 total distressed homes on the active market, 5 fewer than two weeks ago and the lowest total since prior to the Great Recession. Last year there were 153 total distressed sales, 37% more.
• There were 2,474 closed sales in December, a 1% increase from November, and nearly identical to the 2,746 sales that closed in December 2015. The sales to list price ratio was 97.3% for all of Orange County. Foreclosures accounted for just 1.25% of all closed sales and short sales accounted for 1.25% as well. That means that 97.5% of all sales were good ol’ fashioned equity sellers.
Have a great week.

01/13/2017

THE 2017 FORECAST:

With higher interest rates, change is in the air.
With interest rates increasing by nearly a full percent since the election, change is afoot. The new presidential administration is poised to spend money on the U.S. infrastructure and lower taxes, a recipe for increased inflation. As a result, many experts are anticipating more Federal Reserve hikes in the short term rate, which will be accompanied by a rise in long term rates as well. They made an initial hike in December and are poised to make a few more in 2017. Long term rates are not immediately impacted by changes in the short term rate, but multiple increases will definitely have an impact on the Orange County housing market. Here’s the forecast:

--Interest Rates – in December of 2015 the Federal Reserve hiked interest rates and then hinted at four more in 2016. That did not happen for a variety of reasons. Initially, it was for economic reasons, but that shifted to not hiking during an election cycle. Yet, since the election, interest rates climbed on their own accord. Investors around the world pulled their money out of long term bonds and moved into stocks that would benefit under a new administration. Rates rose to as high as 4.5%, but have eased slightly recently. The Federal Reserve meets eight times per year and it will most likely pull the trigger on further increases three more times in 2017: the first one probably in the spring, the second at the start of summer, and the final one coming during the holidays. By year’s end, expect interest rates to eclipse 4.75% and may even climb to 5%.
Active Inventory – the year will begin with a very anemic inventory that will translate to a good start for housing. Yet, with the prospect of inflation, the Federal Reserve will be inclined to pull the trigger and raise rates, most likely two more times by mid-July. Long term rates will rise as well. Buyers will be less inclined to budge from paying more than the Fair Market Value for a home. Higher rates clamp down on affordability. As a result, the active inventory will climb beyond the 8,000 home mark for the first time since 2011 and appreciation will slow considerably. Expect the inventory to peak in August between 8,500 to 9,000 homes.

--Demand – initially, with an anemic inventory and buyers anxious to cash in on historically low rates before they rise further, demand will be strong during the Spring Market. Buyers will be willing to stretch slightly in price compared to the most recent sale; so, expect appreciation around 2% during the first 6-months of the year. As the Fed increases rates, buyers for the second half of the year will not want to overpay and will zero in on the Fair Market Value for a home. Demand will fall slowly and appreciation will be flat for the second half of the year.

--Housing Cycle - the housing market will follow a normal housing cycle. The strongest demand coupled with plenty of fresh inventory will occur during the Spring Market. This will be followed by less demand and a continued new supply of homes in the Summer Market. From there, demand will drop further along with fewer homes to enter the fray in the Autumn Market. Finally, all the distractions of the Holiday market will be punctuated with the lowest demand of the year and few homeowners opting to sell.
Closed Sales - the number of successful, closed sales will be slightly fewer than 2016. There will be a similar number of “move-up” sellers, which will prove to be a wise decision as mortgage rates rise in the future and affordability starts to erode.

--Luxury Market – luxury sales will drop slightly from 2016’s record. There will be a buildup of inventory in the upper ranges and the overall market will feel sluggish.
Distressed Inventory - the distressed inventory will remain low with a very similar level of successful short sales and foreclosures, representing just a few percent of all sales by year’s end.

The bottom line, 2017 will feel a little slower than the past couple of years. At first buyers will be lining up to take advantage of the end to low rates, but as affordability erodes, so will the buyer’s appetite to pay much more than the Fair Market Value for a home. The inventory will rise on the backs of sellers pushing the limits on price. The market will move from a hot seller’s market for the first half of the year, to a market all about price. As the inventory rises, appreciation will come to a halt and Orange County will be poised to move from a seller’s market to an equilibrium market, one that does not favor a buyer or seller.

09/28/2016

The Gallup organization recently released a survey in which Americans were asked to rank what they considered to be the “best long term investment.” Real estate ranked number one, with 35% of those surveyed saying it was a better long term investment than stocks & mutual funds, gold, savings