UCI

Housing Market

Optimism about Orange County housing has rebounded with the economy. Today, six in 10 homeowners say buying a home here is an excellent or good investment, while 30 percent call it fair and 8 percent say poor. Among renters, 45 percent call the local housing market an excellent or good investment, 34 percent say fair and 17 percent call it poor. Graph

The number who think a home in Orange County is a favorable investment is up 10 points among homeowners since last year, while the number who say it is a bad investment is down 10 points. Homeowners are now as optimistic as they were before the county’s financial crisis.

Among renters, the number who consider buying a house in Orange County to be an excellent or good investment has risen 4 points, while the number who consider it a bad one is down 8 points. Renters’ confidence in the housing market is about at the level it was in 1994 (47%), but below the confidence expressed in 1993 (53%). Graph

Orange County housing is most attractive to those who are earning more than enough to make ends meet, of whom 59 percent say it is an excellent or good investment. However, a majority of those making just enough to pay the bills (54%) also consider buying a house in Orange County to be an excellent or good investment. Among those who say they are not earning enough to get by, only 44 percent say housing in the county is a wise investment.

Similarly, among those who worry about money very or fairly often, only 50 percent consider buying a house to be an excellent or good investment, compared to 59 percent of those who seldom or never worry.

The median monthly mortgage payment is $960 this year, and the median rent is $713. Sixty-four percent of homeowners and 44 percent of renters pay more than $750 a month for housing. Mortgages are up 4 percent from last year’s median of $919. The number of homeowners paying more than $750 a month has returned to the high level seen in 1993. Rents, meanwhile, are down 2 percent from the 1995 median of $730. This is the second year in a row that rental payments have dropped. The number of renters paying more than $750 has fallen to the level seen in 1990. Graph

South County remains the most expensive region, with 73 percent of homeowners and 63 percent of renters now paying more than $750 a month for housing. Elsewhere, 59 percent of homeowners and 38 percent of renters pay more than $750. In fact, the number of renters paying more than $750 a month actually increased 4 points in the South County since last year, while the number paying that amount in the rest of the county fell by 5 points.

High rents and mortgages make for economic insecurity. Of those who worry about money very or somewhat often, 72 percent pay mortgages and 61 percent pay rents of more than $750 a month. Among those who worry seldom or never, only 55 percent pay mortgages and 48 percent pay rents over $750.