Is OC Housing Supply Exceeding Demand?

Orange County population growth has been slowing since 2015, and the housing sector is starting to respond. According to research from JLL, single-family and multifamily new construction activity began to slow down last year in response to slowing population growth. Despite this population pattern ongoing for the last four years, new development continued to increase in 2016 and 2017.

“The housing market has already showed signs of slowing down, especially when it comes to homebuying. This is happening in Orange County and across the Southern California region as homebuying has experienced a year-long cool down and buyers have begun to gain leverage,” Paulina Torres, research analyst at JLL, tells GlobeSt.com. “Housing completions for both single and multi-family have increased for all Southern California counties except for Orange County, where single-family completions have increased but multi-family completions have decreased. This is partially due to the heavy increases in multi-family construction, concentrated in Irvine Business Complex, beginning in 2013 that are finally cooling down.”

While the population growth in Orange County is slowing, population continues to increase in the market—and at a higher rate than surrounding markets, like Los Angeles and the Inland Empire. “Although Orange County’s population continues to grow, its rate of growth has been slowing for the past 4 years,” Torres says. “In the Southern California region, Riverside and San Bernardino counties show similar population growth patterns; both experienced a sharp spike in 2010 and have since then remained somewhat steady, while Orange County’s growth pattern is more like that of Los Angeles.”