Orange County's real estate market has always been dynamic, and 2026 is shaping up to be no different. After the volatility of recent years, what can homebuyers, sellers, and investors expect? Let's dive into the data and trends shaping Orange County's housing market in 2026. For the latest market data, check Orange County Realtors and Zillow's Orange County market data.
2025 Recap: What Happened Last Year
Before we look ahead, let's understand where we've been. In 2025, Orange County saw:
- Price stability: After 2023-2024 corrections, prices stabilized and began modest growth
- Inventory increases: More homes came on the market as rates stabilized
- Buyer activity: Steady demand from both local and out-of-state buyers
- Rate environment: Mortgage rates fluctuated between 6% and 7.5%
This sets the stage for what's coming in 2026.
Home Price Predictions for 2026
Overall Market Outlook
Most experts predict modest price appreciation of 2-4% in Orange County for 2026. This is more sustainable than the double-digit growth of 2020-2022, but still represents growth.
- Limited inventory (still below historical norms)
- Strong local economy
- Desirable location and lifestyle
- Continued demand from buyers
- Affordability constraints (high prices + rates)
- More inventory coming to market
- Economic uncertainty
- Potential for higher rates
Market Segments
- Expect stronger growth (3-5%)
- Less rate-sensitive buyers
- Continued demand from high-net-worth individuals
- Inventory remains tight
- Moderate growth (2-3%)
- Most competitive segment
- Rate-sensitive, so more volatility
- Good inventory levels
- Slower growth (1-2%) or flat
- Most rate-sensitive
- First-time buyer challenges
- Limited inventory in this range
Inventory Trends
Current Inventory Levels
As of late 2025, Orange County had about 2.5 months of inventory, which is still considered a seller's market (balanced market is 5-6 months). For current inventory levels, check Orange County Realtors market reports.
What to Expect in 2026
Inventory will likely increase due to:
1. More new construction: Several developments coming online 2. Baby boomers downsizing: Aging population selling larger homes 3. Relocations: Some residents moving out of state 4. Investment property sales: Some investors selling in current market
However, inventory will remain tight because:
1. Low new construction: Still below historical levels 2. High ownership costs: Many homeowners locked in low rates, won't sell 3. Strong demand: Continued interest from buyers 4. Limited land: Orange County is largely built out
Prediction: Inventory will increase to 3-4 months by end of 2026, moving toward a more balanced market.
Buyer Demand Forecast
Who's Buying in 2026?
1. First-Time Buyers: - Will continue to face challenges - Need creative financing solutions - Looking for value and opportunities - May wait for rates to drop further
2. Move-Up Buyers: - Equity from previous homes - More flexibility with rates - Looking for better locations/schools - Active in mid-to-upper price ranges
3. Investors: - Still active, especially in rental market - DSCR loans making it easier - Looking for cash-flowing properties - May be more selective
4. Relocating Buyers: - Continued interest from other states - Attracted to OC lifestyle and economy - Often cash buyers or well-qualified - Focused on specific areas
Demand Factors
- Strong job market
- High quality of life
- Good schools
- Desirable climate and location
- Limited alternative markets
- High prices
- Mortgage rates
- Affordability challenges
- Economic uncertainty
Interest Rate Impact
Current Rate Environment
As of January 2026, mortgage rates are in the 6.5% to 7.5% range, depending on loan type and borrower profile.
Rate Predictions for 2026
Most economists predict:
- First half: Rates may remain elevated (6.5-7.5%)
- Second half: Potential for decreases if inflation continues cooling (could drop to 6-6.5%)
- Volatility: Expect continued fluctuations based on economic data
- Higher rates = fewer buyers, more inventory, slower price growth
- Lower rates = more buyers, less inventory, faster price growth
- Stability = more predictable market conditions
Neighborhood-Specific Trends
Hot Markets (Strong Growth Expected)
1. Irvine: - Continued strong demand - Excellent schools attract families - New construction supporting growth - 3-5% price appreciation expected
2. Newport Beach: - Luxury market remains strong - Limited inventory - High-net-worth buyers active - 4-6% growth possible
3. Costa Mesa: - More affordable than coastal cities - Revitalization continuing - Attracting younger buyers - 2-4% growth expected
Stable Markets (Moderate Growth)
1. Santa Ana: - More affordable entry point - Gentrification continuing - Good value for buyers - 1-3% growth expected
2. Anaheim: - Tourism economy supporting market - More inventory available - Good for first-time buyers - 1-2% growth expected
3. Huntington Beach: - Coastal appeal - Steady demand - Balanced market - 2-3% growth expected
Market Challenges for 2026
For Buyers
1. Affordability: High prices + rates = challenging for many 2. Competition: Still competitive in desirable areas 3. Inventory: Limited options in some price ranges 4. Rates: Uncertainty about rate direction
For Sellers
1. Pricing: Need to price competitively 2. Time on market: May take longer to sell 3. Concessions: May need to offer incentives 4. Competition: More inventory = more competition
For Investors
1. Cash flow: Higher rates = lower cash flow 2. Prices: Still high, limiting returns 3. Regulations: Potential rental restrictions 4. Market timing: Uncertainty about best entry point
Opportunities in 2026
For Buyers
1. More inventory: More options than recent years 2. Less competition: Fewer multiple-offer situations 3. Negotiating power: More room to negotiate 4. Rate potential: Rates may decrease later in year
For Sellers
1. Strong demand: Still good buyer interest 2. Price growth: Modest appreciation expected 3. Equity: Many homeowners have significant equity 4. Market timing: Good time to sell if moving up
For Investors
1. Rental demand: Strong rental market continues 2. DSCR loans: Easier financing for investors 3. Long-term growth: OC remains strong long-term 4. Diversification: Good addition to portfolio
What This Means for You
If You're Buying
- Timing: No need to rush, but don't wait forever
- Strategy: Get pre-approved, be ready to act. Explore our home buying landing page to get started.
- Expectations: Prices may grow modestly, rates may decrease. Learn more about current rates
- Action: Focus on finding the right home, not timing the market. Explore home buying programs or visit our buying landing page
If You're Selling
- Pricing: Price competitively, don't overprice
- Preparation: Make your home show-ready
- Timing: Spring/summer typically best, but market is year-round
- Strategy: Work with experienced agent who knows local market
If You're Investing
- Focus: Look for cash-flowing properties
- Financing: Consider DSCR loans for flexibility. Read our complete DSCR guide or explore investment property financing
- Location: Focus on areas with strong rental demand
- Long-term: OC remains strong long-term investment
Key Metrics to Watch
Throughout 2026, watch these indicators:
1. Months of inventory: Moving toward balance? 2. Days on market: Increasing or decreasing? 3. Price per square foot: Trending up or down? 4. Mortgage rates: Direction and volatility 5. New construction: How much coming online? 6. Job growth: OC economy strength 7. Migration patterns: People moving in or out?
The Bottom Line
Orange County's real estate market in 2026 will likely see modest, sustainable growth rather than the boom-and-bust cycles of recent years. Prices should appreciate 2-4%, inventory will increase but remain tight, and buyer demand will remain steady.
The key is understanding your specific situation and goals. Whether you're buying, selling, or investing, the market offers opportunities—but you need to be strategic and work with professionals who understand the local market.
At Enzo Maldini, we stay on top of Orange County market trends and help our clients make informed decisions. We understand local market dynamics and can help you navigate buying, selling, or refinancing in today's market.
Ready to make a move in Orange County's 2026 market? Get pre-approved or contact us to discuss your goals and create a strategy that works for your situation. Explore our home buying programs, visit our buying landing page, learn about refinancing options, or explore our refinance landing page.