This is the second in a series of occasional articles as my wife and I confront the challenges of searching for a home in a real estate marketplace with a short inventory level in costly south Orange County, California, hoping to finally transition from years as somebody else’s tenants, to becoming participants in the American Dream of homeownership.
All the signs are there that say to us “Buy Now!” Historically low interest rates hovering in the mid-3’s for a 30-year fixed rate mortgage, and the high-2’s for a 15-year fixed. We have the funds available for a healthy 20 percent down payment and we have been pre-approved by our lender to qualify for a decently priced house.
What we don’t have is enough inventory of product to choose from and that’s making our home search difficult, and causing a slight increase in the prices being demanded by sellers. It’s basic economic formula — low supply plus higher demand equals an increase in prices. Sellers want it, but buyers want a deal and we’re no exception.
Situated between Los Angeles County to the north, and San Diego County to the south, Orange County, Calif. is home to a population of more than 3 million people living in a little over one million housing units. However, a recent news report noted that the county is facing a severe shortage of listings — down to a historic low of 3,700 homes, a far cry from the 18,000 homes that were for sale back in 2005, according to NBC.
So that is a factor that is weighing heavily on our decision of where to buy. We know we want to stay in the southern half of the county where we’ve lived for the past 17 years. We also know that we want a single level home so my wife does not have to negotiate stairs, plus, the kids are grown and out of the house so we only need enough living space for us, and enough room for the kids to come home and visit or to entertain guests.
We don’t really want attached housing (aka a condo or townhome) and would prefer not to have HOA dues if at all possible. But, we have been considering looking at age restricted communities like Laguna Woods (aka Leisure World) and others dotting the south county landscape that require their residents be at least 55 years of age or older and have amenities included. Tempting, but they all have various levels of monthly HOA dues to pay and many refer to their homes as “condos” – either attached or detached.
To start with, we are aware that distressed properties — especially bank-owned homes (REOs) — are few and far between and those that do make it to market get snatched up almost immediately after a heated bidding war. So instead we began our search instructing our realtor that we were especially interested in seeking out pre-foreclosure (or short sales), of which there have been quite a few of late.
In the next column I’ll begin detailing what we’re finding out there as my wife and I begin our search in earnest and the bumpy road of competing with real estate investors for the better deals.
Search foreclosures and for-sale homes in Orange County on RealtyTrac NOW!
Also, here are some of the latest stories from the RealtyTrac newsroom that may be of interest to you:
On the Road to Homeownership: Another Chance
Slow, Steady Recovery Best for Housing
Will There Be an FHA Bailout