As we head into the final months of 2025, Orange County’s housing market is giving us plenty to talk about. Buyers and sellers alike are wondering: Are prices finally coming down? Will there be more homes to choose from? Are interest rates making things any easier?
The September housing report gives us some answers — and paints a clearer picture of what the rest of the year might look like.
The “No Foreclosure Wave” Myth
Let’s start with the big question on everyone’s mind: Are we heading into another housing crash?
The short answer: no.
Unlike 2008, when risky loans led to a flood of foreclosures, today’s homeowners are on much stronger financial ground. Lending standards have been tighter for over a decade, people have more equity in their homes than ever, and distressed sales (foreclosures or short sales) are almost nonexistent. Right now, only eight distressed homes are for sale in the entire county — that’s just 0.2% of all listings.
So if you’ve been waiting for a crash to scoop up a bargain, you may be waiting a very long time.
Inventory: Fewer “For Sale” Signs This Fall
In September, the number of homes for sale in OC took its biggest drop of the year — down 4% in just two weeks. We’re now at about 4,576 homes on the market, the lowest since spring.
What does that mean? Well, as we roll into the holidays, sellers often pull their homes off the market, and fewer new listings pop up. It’s a seasonal trend we see almost every year. So, if you’re a buyer hoping for more choices, you may actually see fewer options between now and the New Year.
Buyers Are Tiptoeing Back In
Here’s some good news: buyer activity is picking up — slowly. Pending sales in September rose to 1,609, the highest since March. Why? Mortgage rates dipped below 6.5% in early September for the first time in almost a year, giving buyers a little breathing room.
Think of it like this: when rates fall, even just a little, it’s like someone opening the gates at Disneyland. Suddenly, more people jump in line. If rates stay under 6.5% (or even better, drop closer to 6%), expect to see more buyers entering the market in Q4.
How Long Does It Take to Sell a Home Right Now?
The average OC home is taking about 85 days to sell — that’s nearly three months. Last year at this time, it was just 71 days.
What does this mean for you?
Sellers: You can’t just put a “For Sale” sign in the yard and expect multiple offers in a weekend anymore. Presentation, pricing, and patience are key.
Buyers: You have more breathing room to think before writing an offer. Homes aren’t flying off the shelves, so you can shop more carefully.
Luxury Market: Heating Up Again
At the higher end of the market (homes over $2.5M), things are moving faster. Inventory has dropped, demand has jumped, and luxury homes are selling in about six months instead of seven or more.
Why? Strong stock market performance and those slightly lower interest rates have boosted confidence among luxury buyers. Coastal homes and properties with unique features are still commanding plenty of attention.
So, What’s the Big Picture for Q4?
-No crash coming — distressed sales are almost nonexistent.
-Inventory is shrinking as we head into the holiday season.
-Buyers are cautiously reentering the market, thanks to slightly lower rates.
-Homes are taking longer to sell, but the market is still moving.
-Luxury is strong, especially along the coast.
Final Thought
The OC housing market today is like an airplane hitting a little turbulence — it might feel bumpy, but it’s not crashing. Buyers have more time and options than during the frenzy a couple of years ago, while sellers can still take advantage of solid home values and strong equity.
Whether you’re buying, selling, or just keeping an eye on the market, Q4 is shaping up to be a season of balance.
If you’d like to know what these trends mean for your neighborhood or home, reach out — I’d be happy to walk you through it.