The real estate market in Southern California, and particularly in Orange County, has been through a rollercoaster ride over the past few years. After experiencing a dramatic surge in home prices during the pandemic, the market has faced some challenges, including higher mortgage rates and a tightening of buyer activity. As we move into the latter part of 2025, many are asking: Is Orange County entering a “soft landing” in its housing market? In this blog, we’ll break down the latest data to explore whether the market is stabilizing or if we’re still facing uncertainty ahead.

What is a “Soft Landing” in Real Estate?

Before diving into the numbers, it’s essential to understand what a “soft landing” means in the context of real estate. A soft landing refers to a scenario where a market, after experiencing rapid growth or inflation (like the one we saw during the pandemic), slows down or stabilizes without experiencing a sharp downturn or crash. In real estate, this would mean home prices level off or experience slight declines without causing widespread foreclosures or market panic.

A soft landing would typically be marked by gradual price corrections, stable demand, and balanced inventory levels—key characteristics that suggest the market is stabilizing rather than crashing.

The Latest Numbers: Is Orange County Stabilizing?

To determine whether Orange County is headed toward a soft landing, we need to look at some key real estate indicators. Here’s a breakdown of the latest numbers for Orange County’s housing market in late 2025:

1. Home Prices Are Stabilizing, But Not Declining

One of the clearest signs of a soft landing is a stabilization in home prices. After seeing a steep rise in home values during the pandemic, home prices in Orange County have begun to plateau. According to recent reports, the median home price in Orange County has leveled off compared to last year, with slight fluctuations month-to-month but no significant drops.

In September 2025, the median home price was reported at approximately $1.15 million—similar to prices earlier in the year. While this is still high compared to historical averages, it marks a departure from the rapid price increases seen during the peak of the pandemic. This stabilization indicates that the market is not overheated and is starting to level off, a hallmark of a soft landing.

2. Inventory Levels Are Improving Slowly

One of the critical drivers of the 2025 housing market is inventory. In the past few years, there has been a significant housing shortage in many parts of Orange County, leading to bidding wars and inflated prices. However, in recent months, inventory has begun to rise, albeit slowly.

By October 2025, the number of available homes in Orange County was up by 12% year-over-year. While this increase is still modest, it signals that more homes are coming to market. Buyers have more options now, which helps ease some of the pressure that has been building on the market for years. With rising inventory levels, homebuyers are less likely to rush into bidding wars, which can lead to a more balanced market.

3. Mortgage Rates and Affordability

The high mortgage rates that have plagued the market over the past year are another significant factor influencing the current market conditions. As of late 2025, mortgage rates remain relatively elevated compared to the historic lows seen during the pandemic. Rates have stabilized in the mid-to-high 6% range for a 30-year fixed mortgage.

While these rates are still higher than many buyers would like, they are no longer rising at a rapid pace. This steadiness in rates allows buyers to plan more effectively, which could contribute to the market’s stabilization. However, higher rates still impact affordability, keeping many first-time buyers and move-up buyers on the sidelines.

Despite these challenges, demand for homes in Orange County remains strong, especially in desirable areas like Irvine, Newport Beach, and Costa Mesa. While some buyers are stretching their budgets due to higher mortgage payments, the demand from affluent buyers in the county’s luxury market has kept prices from falling significantly.

4. Days on Market and Seller Flexibility

Another key indicator of a market transition is the number of days homes are spending on the market before being sold. In Orange County, homes are now sitting on the market for slightly longer than they did during the pandemic-driven frenzy, but the number is still lower than the pre-pandemic average. On average, homes in Orange County are staying on the market for 40 to 50 days, a clear increase from the 20 to 30 days typical during the pandemic.

This lengthening of days on market suggests that buyers are taking a more cautious approach. Sellers, too, are starting to show more flexibility. In some cases, sellers are willing to lower prices slightly or offer concessions to attract buyers. This shift indicates that we are moving away from the aggressive seller’s market and toward a more balanced environment, typical of a soft landing.

5. Regional Variations Within Orange County

While the overall Orange County market is stabilizing, there are regional variations worth noting. High-demand, coastal cities like Newport Beach and Laguna Beach are still experiencing relatively high levels of buyer activity and seeing fewer price reductions. Meanwhile, inland cities like Santa Ana and Fullerton are seeing a slightly slower market, with more price adjustments and longer days on the market.

This regional variation is a sign that the market in Orange County is not experiencing a broad-based collapse but rather a targeted cooling in specific areas. This regional shift is another indicator that Orange County is entering a soft landing rather than a market crash.

The Outlook: What to Expect Moving Forward

So, is Orange County headed for a soft landing? Based on the latest data, it seems likely. The market is stabilizing, with home prices holding steady, inventory slowly increasing, and demand still relatively strong. However, the market remains sensitive to factors like mortgage rates, inflation, and broader economic conditions, which could influence its trajectory moving forward.

For buyers, this is a positive sign. While competition is still strong in certain neighborhoods, buyers now have more options and can be more strategic in their purchasing decisions. For sellers, it’s important to remain realistic about pricing and be prepared for longer listing times and more flexibility in negotiations.

How Amin Vali Real Estate Investment Group Can Help

Whether you’re a buyer, seller, or investor, understanding market trends and having the right strategy in place is crucial in navigating Orange County’s evolving real estate market. If you’re looking to make a move in Orange County or need expert guidance on how to capitalize on current market conditions, Amin Vali Real Estate Investment Group is here to help.

Our team has extensive experience in the Southern California market, and we can provide you with the insight and resources needed to make informed decisions. From finding the right property to negotiating the best price, we’re dedicated to helping you achieve your real estate goals.

Contact Amin Vali Real Estate Investment Group today to learn more about how we can assist you with your real estate needs in Orange County and beyond.

Amin Vali .

B.S in Civil Engineering,MBA, Realtor

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