Scanning the Orange County residential real estate data for clues and trends, we noticed two key stats moved significantly in favor of buyers during the last two weeks. And, we’re not in the real estate business, and we don’t view the real estate world from the viewpoint of sellers or buyers - so you get the straight scoop from OC180NEWS. We run the numbers for the two weeks ending September 2, 2010.

The ratio of supply and demand – otherwise known as market time, or average time on the market, is one key measure we track at OC180NEWS. A market time of 5.0 months or higher is considered, even by realtors, as a buyers market. OC market time has not hit that level yet, but the trend has been unmistakable for weeks, if not months.

OC’s Market time hit the recent low of only 2.35 months at the peak of the tax credit inspired buying spree in April of this year. By the end of April, there were only 9,351 homes on the market and demand was an alpine high of 3,979 units. Now, there are 11,717 homes for sale, but demand has fallen to 2,893. Thus, market time crossed the 4.0 months benchmark for the first time since March 2009.

Not only is market time heading directly into buyer’s market territory, the growth of the number of distressed properties on the market just keeps right on going. Since distressed properties – short sales and foreclosures – act as a type of price constraint, increases in this number, as well as the percentage of total inventory which is distressed, represents movement toward a buyer’s market.

The number of distressed homes on the market in Orange County, with only a few minor exceptions, has increased every biweekly period since last October. Prior to October 2009, the number of distressed homes in inventory had been decreasing steadily. As of September 2, 2010, there were 3,911 distressed homes on the market, an increase of 154 in just two weeks. In October 2009, there were only 2,398 distressed homes in inventory.

The distressed properties on the market are now 135% of demand, a level not seen since March 2009. Further, the percentage of active listings which are distressed, at 33.4%, also has hit a recent high. All this, even though Orange County employment keeps improving and last month was the highest job creator in California (see related article below).

In this article series we report on the numbers for Orange County in total. Real estate is very local and any buying or selling decisions should be based on circumstances of specific neighborhoods. This series is intended to provide information about general countywide trends in supply and demand.

All real estate data in this article is from a report published by Steven Thomas of Altera Real Estate.

This report appears on OC180NEWS every other Monday.