The Orange County housing market is currently in a unique "compressed window." With inventory at its lowest point in years and buyer demand beginning to wake up, February 2026 offers a strategic moment to act before the traditional spring rush accelerates competition and pricing.
1. Inventory: A Historical Shortage
Supply is currently the biggest driver of market conditions. We are seeing a steady erosion of available homes that is outpacing typical seasonal patterns.
• Active Listings: Only 2,344 homes are currently on the market across the county.
• The Trend: This represents an 18% drop year-over-year and a 12% drop month-over-month.
• The Low Point: This is the lowest level of active inventory since April 2023.
2. Demand: Buyers are Re-engaging Early
While pending sales are down 13% from December due to the holiday pause, the last two weeks have shown a notable shift.
• Rising Momentum: Demand has increased by 2% in just the last 14 days.
• Early Signals: Motivated buyers are returning to the market earlier than expected, signaling that spring momentum is already building.
3. Pricing & Mortgage Rates
Home values remain resilient despite shifting interest rates.
• Steady Values: While the rapid appreciation of 2021-2022 has slowed, median home prices remain firm across most OC cities.
• Rate Context: After holding below 6.5% in the fall, mortgage rates have edged slightly higher. However, they remain significantly lower than the 7.5% highs seen in early 2024, providing a compelling window for rate-conscious buyers.
4. The Luxury Snapshot ($2M+)
The high-end market is tightening, particularly in coastal enclaves.
• Market Pace: The expected market time for luxury properties is 154 days, which represents a balanced pace.
• Coastal Heat: Areas like Laguna Beach and Monarch Beach in Dana Point are already trending back toward conditions that favor sellers.
• Luxury Stats: Inventory in this tier is down 9%, while demand has ticked up 5% in the last two weeks.
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Strategic Takeaways
• For Sellers: Now is the time to prep and stage. With supply so low, you can achieve maximum exposure before the market becomes crowded with other listings in the spring.
• For Buyers: Acting now allows you to get ahead of the spring competition and potential price acceleration
About the Author
Leilani Serrao-Baker
Dana Point Real Estate Professional
Leilani Serrao-Baker
28202 Cabot Rd Ste 300
Laguna Niguel, CA 92677
(949) 444-9175
https://civitasrealtyca.com
Leilani Serrao-Baker is a Dana Point real estate expert specializing in helping buyers and sellers navigate the coastal Orange County market. With over 14 years of experience, she is known for helping clients make strategic, informed real estate decisions with a focus on long-term value.
