Here is why property prices are going to climb in 2025 in Anaheim

Our industry specialist has reviewed and approved the final article. Also, some of the data presented here have been integrated into the Anaheim real estate spreadsheet template.

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Expecting a decrease in Anaheim's prices in 2025? Think again.

Even with changes in the market, Anaheim's demand is high, and supply is tight, pushing prices up.

Let's explore the reasons why costs in this city are set to rise in 2025.

This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.

1) Anaheim has about 0.32 homes per person, indicating a housing shortage

Signal strength: strong

The fact that there is around 0.32 home per inhabitant in Anaheim indicates a limited housing supply relative to the population.

This low ratio suggests that housing demand is likely to exceed supply, which typically leads to rising prices. In Anaheim, a factor that contributes to this situation is the presence of major attractions like Disneyland, which draws a large number of workers and visitors.

These attractions create a constant demand for housing, as people want to live close to their workplace or the entertainment options. As a result, the limited availability of homes becomes a significant factor in driving up prices.

If the ratio were to increase to around 0.5 home per inhabitant, it might indicate a more balanced market, potentially stabilizing prices.

Source: USCensus

2) Redfin considers the Anaheim real estate market to be "very competitive"

Signal strength: strong

The fact that Redfin ranks the Anaheim real estate market as "very competitive" is a strong indicator that housing prices are likely to rise in 2025. When a market is labeled as "very competitive," it means that there is a high demand for properties, often leading to bidding wars and higher selling prices.

In Anaheim, the most competitive properties are single-family homes, particularly those located in areas with good school districts and proximity to Disneyland. Families and investors are drawn to these homes because they offer stability, potential for appreciation, and rental income opportunities.

As more people seek to buy these types of properties, the demand continues to outpace supply, which naturally drives prices up. However, if the market were to become "less competitive," with more properties available than buyers, this would signal a potential decrease in housing prices.

Source: Redfin

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3) In Anaheim, about 62% of homes sell for more than their listing price

Signal strength: strong

In Anaheim, a significant indicator of a rising housing market is that around 62% of sales close at a price higher than the listing price. This suggests that buyers are willing to pay more than the asking price, indicating strong demand and competition among buyers.

When demand exceeds supply, it often leads to increased property values over time. This is because buyers are competing for a limited number of homes, driving prices upward.

Such a trend is a clear signal that housing prices are likely to continue rising in the near future. However, if this percentage were to drop significantly, say below 40% of sales closing above the listing price, it might suggest a cooling market instead.

Source: Zillow

4) Three major websites predict that home prices in Anaheim will rise in 2025

Signal strength: strong

There are currently three major websites forecasting a positive growth for home prices in Anaheim in 2025, which is a promising signal for potential investors.

Among these forecasts, Zillow predicts a 5.50% increase in home prices, while Realtor also anticipates a 5.50% rise, and Redfin expects a 4% growth in home prices. This indicates a general consensus among these platforms, although there is a notable gap between the most and least optimistic predictions.

While these forecasts are encouraging, it's important to remember that projections should be approached with caution. We will also rely on strong, reliable, and current data to make a well-informed decision.

If these forecasts were to predict a negative growth or a decline in home prices, it would suggest a different outlook for the market.

Sources: ZillowForecasts, RedfinForecasts, RealtorForecasts

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5) Anaheim's is just 4.5%, showing it's a bustling and competitive market

Signal strength: moderate

The vacancy rate in Anaheim is currently at 4.5%, which is considered very low. This low vacancy rate suggests that most properties are occupied, indicating a strong demand for housing in the area.

When demand is high and supply is limited, prices tend to rise as more people compete for fewer available homes. This is a classic economic principle where high demand and low supply lead to increased prices.

In Anaheim, well-maintained single-family homes in neighborhoods like the Anaheim Hills are particularly sought after. These properties are easily rented due to their desirable location and condition, making them attractive to both renters and investors.

If the vacancy rate were to increase to around 7% or higher, it might indicate a shift towards a less competitive market, potentially stabilizing or even lowering housing prices.

Sources: NeighborhoodScout, DataUSA, USCensus

6) Anaheim's "Livability" score of 69 indicates a favorable quality of life

Signal strength: moderate

The fact that the livability score in Anaheim is 69 is a positive indicator for potential real estate investors.

This score reflects the city's strong community amenities, including parks and recreational facilities, which are highly valued by residents and can drive demand for housing. Additionally, Anaheim is known for its proximity to major attractions like Disneyland, which not only boosts tourism but also enhances the local economy and job market, making it an attractive place to live.

Furthermore, the city has a well-developed transportation network, including access to major highways and public transit, which makes commuting convenient and adds to its appeal. These factors contribute to a higher quality of life, which can lead to increased demand for housing and, consequently, rising property values.

If the livability score were to drop below 50, indicating a decline in these key areas, it might suggest a less favorable outlook for housing prices.

Source: AreaVibes

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7) Selling a house in Anaheim now takes 30 days, compared to the previous 40 days

Signal strength: moderate

When a house sells faster, it often means that there is a higher demand for homes in that area. In Anaheim, the time it takes to sell a house has decreased from around 40 days to just 30 days, indicating that buyers are eager to purchase homes quickly.

This eagerness can drive up prices because more people are competing for the same properties. When demand increases and supply remains the same, prices tend to rise as buyers are willing to pay more to secure a home.

For someone considering investing in real estate, this is a positive signal that property values might increase in the near future. However, if the time to sell a house were to increase to more than 40 days again, it could suggest that demand is weakening, potentially affecting prices negatively.

Source: Redfin

8) Anaheim home values have risen by 11.0% since last year, and this trend could persist

Signal strength: moderate

The fact that home values in Anaheim have already changed by 11.0% since last year is a strong indicator that the housing market is on an upward trend. This significant increase suggests that demand is high, and if this trend continues, it could mean that housing prices will keep rising in 2025.

Currently, the median home price in Anaheim is around $909,100, which reflects the growing value of properties in the area. Additionally, the median sales price per square foot is about $596, indicating that buyers are willing to pay more for each square foot of living space.

These figures show that the market is robust, and if you're considering investing, it might be wise to act sooner rather than later. However, if home values were to decrease significantly, it could signal a shift in the market dynamics.

For instance, if the percentage change in home values were to drop to a negative figure, it might suggest that the market is cooling off.

Source: Redfin

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9) In the past decade, home prices in Anaheim have consistently risen by an average of 7.2% each year

Signal strength: minimal

The fact that home prices in Anaheim have appreciated at an average rate of 7.2% over the last decade is a noteworthy signal for potential investors. This historical growth rate suggests that there has been a consistent demand and upward trend in housing prices in the area.

While this positive 10-year average indicates a history of price growth and favorable market conditions, it's important to remember that past performance doesn't guarantee future results. However, such a trend can still be a valuable indicator when considering future investments in the Anaheim real estate market.

Investors should consider this data as part of a broader analysis, as it reflects the market's resilience and potential for continued appreciation. It's crucial to combine this information with other factors, such as economic conditions and local developments, to make informed decisions.

If the average appreciation rate were to drop significantly, say below 2% over a similar period, it might suggest a different outlook for future price trends.

Source: NeighborhoodScout

So, are prices going to climb in Anaheim in 2025? Yes, they are!