The Orange County housing market cruised through the third quarter of 2019, with moderate increases in both sales and prices. Single-family home sales rose by almost 3% compared to last year’s third quarter, making up for a more sluggish second-quarter. Pricing was mixed, with the median price up almost 5% but the average down a tick. Why the discrepancy between the average and the median? We believe that the 2018 Tax Reform cap on state and local tax deductions is hampering the highest-end of the market, which is holding down the average even while the overall strength in the market buoys the median. Indeed, the lower-priced condo market doesn’t show the same discrepancy, with both the average and median up sharply, because the condo market doesn’t have a “high end” that is holding it back. Overall, we believe that the fundamentals of the market remain strong – demand is high, inventory is reasonably available, interest rates are near historic lows, and the economy is solid. Accordingly, we expect that Orange will continue to thrive through the end of the year and into 2020.