If you have delusions of finding an Orange County home priced under $500,000 … good luck!

It’s no surprise that finding any Orange County home that fits any budget has become a challenge. But a new study by Steve Thomas of ReportsOnHousing.com shows just how tough a search for a lower-priced home has become.

In late March 2011, as the housing market was trying to revive after the Great Recession’s pounding, there were 5,809 existing homes priced under $500,000 listed for sale in Orange County broker networks. That was 54 percent of what was being sold in the county.

Last Thursday, there were only 1,224 homes listed for sale in that same price range – a eye-popping 79 percent drop in five years. Even with overall homes-for-sale inventory cut in half in five years, homes under half a million now comprise just 22 percent of the market.

Yes, the 2011 housing market was flooded with distressed properties as financially stressed owners tried to unload homes and bankers dumped foreclosures. But even a year later, as the selling panic cooled, 3,162 homes priced under half a million were for sale in Orange County – that was 48 percent of the market.

There are plenty of reasons why cheaper homes are harder to find. But Thomas was blunt at the leading culprit: “What happened to affordable, entry-level housing? The simple answer is appreciation. Homes have been appreciating nonstop since 2012, when the market initially caught fire.”

According to CoreLogic data, the median price of an Orange County home jumped from $410,000 in February 2011 to $610,000 five years later – that’s 49 percent appreciation.

The median hasn’t been below $500,000 since February 2013. (We will also note that the local median first crossed $500,000 in 2004, got to $645,000 in 2007 … and then the bubble burst!)

And a key driver of the rebound, lower mortgages rates, has not fully dulled appreciation’s bite into the typical house hunter’s budget: CoreLogic’s estimate of an Orange County homebuyer’s house payment is up 36 percent in the past five years.

These soaring costs make owners of lower-priced homes less willing to move. Many cannot afford to do the traditional move-up purchase. Others may see their relative “bargains” as keepers and turn them into rentals.

So sales activity dipped along with supply, CoreLogic stats show. In the 12-month period that ended in February 2011, 17,898 Orange County homes priced under half a million sold. In same period that ended in February 2016: Just 12,037 sales in the same price category, a 32 percent drop.

Sky-high housing costs aren’t just a house-hunting hurdle. Pricey real estate is a challenge to the competitiveness of the overall Orange County economy. Think about the difficulty of finding an “affordable” home under $500,000 in Orange County, then note how a $500,000 home looks nationally.

That’s a price tag more than double the national median selling price in 2015 of $224,000, according to the National Association of Home Builders/Wells Fargo price index. And just nine of the 226 cities nationwide tracked by NAHB/Wells had median prices above $500,000 last year.

Thomas did not have encouraging words for Orange County house hunters seeking a relative regional bargain.

“The trend is not favorable. In time, the number of opportunities will fade and competition will increase, making it even more challenging to purchase than it already is today,” Thomas wrote of the sub-$500,000 market. “Buyers should not wait for a wave of fresh inventory to hit the market. That is simply not going to happen.”

Contact the writer: jlansner@ocregister.com