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Thinking Santa Ana property prices might drop in 2025? Think again.
Despite economic shifts, the Santa Ana market is poised for growth, with demand outpacing supply.
In this post, we’ll explore why property prices in this vibrant city are set to rise.
We rely on solid, up-to-date data and statistics from trusted sources, ensuring our analysis is grounded in reality.
By the end, we’ll share our own conclusions based on a comprehensive review of the data. Enjoy the read!
How this content was produced 🔎📝
This article offers thoughtful insights and analysis based on reliable sources, but it should not be considered financial advice. We work hard to research, compile, and analyze data to give you a well-informed perspective. However, as you can guess, our analysis involves subjective choices, such as source selection and methods, and it cannot fully capture the market's complexity. Please, always do your own research, consult professionals, and make decisions based on your own judgment. Any financial risks or losses are your responsibility. Additionally, you should know that we have no affiliation with the sources mentioned, ensuring our analysis is completely impartial.
1) In Santa Ana, there are only about 0.26 homes per person, indicating a housing shortage
Signal strength: strong
The fact that there is around 0.26 home per inhabitant in Santa Ana indicates a limited housing supply.
When the supply of homes is low, and demand remains steady or increases, it often leads to rising housing prices. In Santa Ana, a unique factor is its proximity to major employment hubs like Irvine and Los Angeles, which attracts more residents.
This attraction increases demand for housing, but with only 0.26 home per person, the supply is not keeping up. As a result, this imbalance between supply and demand is a strong signal that housing prices are likely to rise in the near future.
If the number of homes per inhabitant were to increase significantly, say to 0.5 home per person, it might indicate a more balanced market, potentially stabilizing prices.
Source: USCensus
2) Three major websites predict that home prices in Santa Ana will rise in 2025
Signal strength: strong
There are currently three major websites forecasting a positive growth for home prices in Santa Ana in 2025, which is a promising signal for potential investors.
Among these forecasts, Realtor is the most optimistic with a projected increase of 5.50%, followed by Redfin's forecast of 4%, and finally, Zillow predicts a 2.60% rise in home prices. This range of predictions indicates a significant gap in the expected growth rates, suggesting varying levels of confidence among these platforms.
While these forecasts are encouraging, it's important to remember that they should be taken with a grain of salt. We will also rely on strong, reliable, and actual data to make a more informed and professional judgment about the market.
If these forecasts were to predict a negative growth or a decline in home prices, it would signal a different market outlook.
Sources: ZillowForecasts, RedfinForecasts, RealtorForecasts
We created this infographic to show how property prices in Santa Ana compare to other big cities in California. It shows the median price as well as the price per sqft, making it easy to see which places might offer the best value. We hope you find it helpful.
3) With a "vacancy rate" of just 3.5%, Santa Ana's market is highly occupied and competitive
Signal strength: moderate
The vacancy rate in Santa Ana is 3.5%, which is considered very low. This low vacancy rate indicates that the housing market is highly occupied and competitive, suggesting that demand for housing is strong.
When demand is high and supply is limited, it often leads to increased housing prices as more people compete for fewer available homes. In such a market, properties that are easily rented are typically well-maintained and located in desirable areas.
Specifically, modern apartments in downtown Santa Ana are in high demand due to their proximity to amenities and employment opportunities. Investors should consider these factors when evaluating potential real estate investments in the area.
If the vacancy rate were to rise above 7% or higher, it might indicate a shift towards a less competitive market, potentially affecting housing prices differently.
Sources: NeighborhoodScout, DataUSA, USCensus
4) In Santa Ana, nearly half of all sales end up selling for more than the listing price
Signal strength: moderate
In Santa Ana, around 49% of sales close at a price higher than the listing price, which is a strong indicator of a competitive market. This suggests that buyers are willing to pay more than the asking price to secure a property, reflecting high demand.
When demand is high, it often leads to increased competition among buyers, which can drive prices up. This trend is a signal that housing prices are likely to rise as more people are eager to invest in this market.
For potential investors, this means that entering the market now could be beneficial before prices climb even higher. However, if the percentage of sales closing above the listing price were to drop significantly, say below 20%, it might indicate a cooling market.
Source: Zillow
Our team designed this infographic to show how competitive the real estate market in Santa Ana is vs. other major cities in California. It shows the percentage of sales above the list price, a key indicator of market competition.
5) Santa Ana home values have risen by 12.0% since last year, and this trend may persist
Signal strength: moderate
The fact that home values in Santa Ana have already changed by 12.0% 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 the coming years, including 2025.
Currently, the median home price in Santa Ana is around $816,950, which reflects the area's growing appeal and economic strength. Additionally, the median sales price per square foot is about $614, indicating that buyers are willing to pay a premium for property in this market.
These figures show that Santa Ana is becoming a more desirable place to live, which often leads to increased competition among buyers and, consequently, higher prices. If these trends persist, it is reasonable to expect that housing prices will continue to rise in the near future.
However, if the annual change in home values were to drop below 5% or even become negative, it might suggest a cooling market, challenging the assumption of rising prices.
Source: Redfin
6) In the past decade, home prices in Santa Ana have consistently risen by an average of 7.3% each year
Signal strength: minimal
The fact that home prices in Santa Ana have appreciated at an average rate of 7.3% over the last decade is a strong indicator of a healthy real estate market. This consistent growth suggests that there has been sustained demand and increasing property values over the years.
When we see such a positive trend, it often points to favorable conditions for future price increases. However, it's important to remember that past performance doesn't guarantee future results, but it does provide a useful context.
Investors often look at historical data like this because it can help predict future market behavior. If the average appreciation rate were to drop significantly, say to below 3% over a similar period, it might suggest a cooling market.
Source: NeighborhoodScout
This infographic we have made will show you how market values have changed during the last decade in Santa Ana vs other major places in California. Here, the percentage increase or decrease in market value will help you see long-term trends.
So, are prices going to climb in Santa Ana in 2025? Yes, they are!
Santa Ana's housing market is poised for price increases in 2025 due to several compelling factors.
Firstly, the city faces a housing shortage with only 0.26 homes per person, which is a strong indicator of limited supply. This scarcity, combined with Santa Ana's proximity to major employment hubs like Irvine and Los Angeles, drives demand higher. When demand outpaces supply, prices naturally rise.
Additionally, three major websites predict positive growth for home prices in 2025, with forecasts ranging from 2.60% to 5.50%. This consensus among industry experts further supports the expectation of rising prices. Moreover, Santa Ana's low vacancy rate of 3.5% and the fact that 49% of sales exceed the listing price highlight a competitive market where buyers are willing to pay more.
Finally, historical data shows a consistent 7.3% annual increase in home prices over the past decade, reinforcing the trend of rising values. With these factors in play, it's clear that Santa Ana's housing market is set for continued growth in 2025.
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