Here is why property prices are going to climb in 2025 in Santa Ana

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

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

Even with changing patterns, Santa Ana's market stays strong, with high demand and low supply pushing prices up.

Let's explore why this area's prices 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) 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

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3) Santa Ana's is just 3.5%, showing it's a bustling and competitive market

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

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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

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