Orange County Housing Market Update July 2025 | Buyer’s Market Before 4th of July
As we head into the second half of 2025, the Orange County housing market is experiencing its biggest shift in years. Inventory is rising fast, demand is holding steady, and for the first time in a long time, buyers are gaining the upper hand. Whether you’re buying or selling, understanding what’s changed—and what hasn’t—is essential to navigating the summer market.
Inventory Is Up—and Buyers Have Options
The biggest headline at midyear? Inventory. Active listings have surged 61% compared to last year, now sitting at 4,894 homes—the highest level since June 2020. But we’re still 25% below the pre-COVID norm of 6,633 listings. In short: this isn’t a flood of homes, but it is a noticeable shift. After years of tight supply, buyers finally have more choices, more time, and more negotiating power.
Homes Are Taking Longer to Sell
The Expected Market Time (how long it takes to sell a home at the current pace of demand) has climbed to 91 days—the slowest June since 2011. Condos are averaging 81 days on market, detached homes are at 98 days, and last year at this time, the average was just 57 days. This increase is giving buyers breathing room—and forcing sellers to adjust pricing strategies.
Sellers Are Making Price Cuts
With longer market times and more competition, sellers are starting to respond. Nearly 37% of listings have had at least one price reduction this year. And 2,860 homes have been pulled off the market entirely—up 96% from last year. For sellers, this means pricing right from the start is critical. Overpricing in this market = sitting unsold.
Buyer Demand Is Flat—but Poised to Jump
Despite the inventory increase, buyer demand has stayed relatively unchanged. Pending sales are currently at 1,614—nearly identical to last year’s numbers. Why isn’t demand rising with inventory? The answer: interest rates. Mortgage rates have hovered near 7% for over 30 months. If they dip below 6.5% and hold, expect a wave of buyer activity to return. Until then, expect slow and steady demand.
Home Values: Drifting, Not Diving
Orange County home prices remain relatively stable, with small month-to-month shifts. Zillow’s Home Value Index shows prices are up 4.6% year-over-year, but down 0.4% month-over-month. This isn’t 2008. Most homeowners have low mortgage rates and strong equity. So while prices may soften, a crash is highly unlikely.
Luxury Market Slowing Down
The high-end market is feeling the shift too. For homes over $2.5 million, inventory has ticked up to 1,238, pending sales have dipped to 172, and the Expected Market Time has jumped to 216 days. $2.5M–$4M homes are sitting on market for 170 days, $4M–$6M homes for 251 days, and homes over $6M for 330 days. Luxury sellers should prepare for longer timelines and more cautious buyers.
What It Means for Buyers and Sellers
For buyers: You have more options, more time, and more negotiating power than we’ve seen in years. Don’t expect a price crash—but do expect more flexibility and better opportunities if rates drop.
For sellers: Now is the time to price your home based on today’s market—not last year’s peak. The days of bidding wars and instant offers are behind us, but well-priced, move-in-ready homes are still selling.
For everyone: The market isn’t broken—it’s balancing. Whether you’re buying or selling, understanding your segment is the key to navigating this slower, more strategic season.
Final Thoughts
With the 4th of July just around the corner, this midyear shift feels like a fresh reset. If you’re thinking of making a move, summer is your window to plan ahead—before buyer competition returns in full force. Ready to talk strategy? Let’s connect and go over your options in today’s evolving market. Reach out to Christopher and Broox Mahr with MMG Real Estate Advisors—your trusted local experts in Orange County real estate.
