Orlando Florida Regional Housing Update August 2015

THE ORLANDO FLORIDA

REGIONAL HOUSING

MARKET UPDATE

August 2015

The latest housing market data are in for Central Florida, including Lake Mary Florida, Heathrow Florida, Longwood Florida, Sanford Florida, Winter Springs Florida, Oviedo Florida, Debary Florida, New Smyrna Beach Florida, Apopka Florida, Orlando Florida, Belle Isle Florida, Maitland Florida, and Altamonte Springs Florida. Here are the highlights taken from the Orlando Realtor Regional Board ending July 2015 (the latest now available):

Inventory 

The inventory numbers moved back down this month, albeit slightly. There are now 11,819 homes on the market, down from 12,058 homes on the market last month, but up from 11,798 homes the previous month.  There were 3,388 closings in July – almost 25% more than July last year. The current inventory is 2.27% lower than this time last year and down 1.98% from last month. 

It is fairly normal for inventory numbers to slowly start to drop off as the fall season comes into play and with it a natural slowdown for the holidays. 

The inventory numbers include all homes: single family homes, condos, duplexes and townhomes.  For comparison: In December of 2008, there were 22,524 on the market. In March 2013, which was where inventory bottomed out, there were only 6,937.  

Normal (aka arms-length) sale inventory is up 9.9% and bank-owned inventory is now down again by 28.83% from a year ago.  This is now the sixth month in a row this has dropped.  Short sale inventory is also again down a significant 44.04% from a year ago. 

Single family home inventory is down 4.41% from a year ago, but the condo inventory is up 3.37%.  The inventory of duplexes, townhomes and villas is up 8.75% from a year ago.

This inventory is what is reflected on the Multiple Listing Service (MLS). While it is typical for new home construction companies to elect not to put any or only a portion of their inventory on the MLS – however, as predicted in previous reports, with the rise in inventory, more of these inventoried new homes are showing up on the MLS.  

Sales 

Overall sales were up a vigorous 33.28% from a year ago, but down 5.97% from last month.   

Single family home sales increased 33.73% while condo sales decreased by 20.26% as compared to last year.   Townhome and Villa sales were up 48.33% from a year ago to 310. 

Sales of existing homes (i.e. excluding new construction) were up 16.16% when compared to last year at this time and are up 19.26% so far this year.     

Of the 3,388 closed sales in July, 2,557 or 75.47% were “normal”, 130 were short sales (3.84%) and 701 (20.69%) were bank-owned. The number of normal sales increased by 51.48% compared to a year ago while the number of short sales fell by 40.37%.  Bank-owned sales increased by 10.22% over the same period.  All of three of these are now established trends. 

This marks the fourth month since the 2008 melt down that the normal sales have accounted for 70% or more of the total sales and the first month that normal sales have topped the 75% mark.   

In addition, this is now a very well-established trend wherein the number of short sales are far fewer than bank-owned sales.  This month again is no exception and we see that foreclosure sales are up again – though not by much.  Both seem to indicate that banks are electing more and more to foreclose rather than agreeing to a short sale. This could be due to four things: 1. a working theory that a foreclosure may now end up bringing an overall higher sale price than a short sale; and/or, 2. there are fewer short sale candidates with an improved economy; and/or, 3. many of the bank sales are properties that were picked over previously and now represent the only “deals” left and thus are finally being bought; and/or 4. many foreclosures have been in process for years, often delayed by the lenders themselves, and simply can now be wrapped up.

In addition, as the housing recovery continues (albeit at a slower pace than previous downturns), the reported percentage changes year-over-year will continue to diminish. However, as long as these numbers remain positive, indicating growth, this will be the mark of a more stable housing market environment. 

Homes spent an average of 69 days on the market in July –  two more than last month and four days fewer than a year ago. The average home sold for 96.92% of its then-current listing price. “Then current listing price” is an important distinction since a home may have been on the market with prior price reductions.  Thus, it may have ended up selling for a lot less than the percentage cited from its original debut listing price. At the current pace of sales, there is a 3.49 month supply – virtually unchanged from last month. 

Estimated Supply is tied to both inventory and pace of sales.  Six months of supply is generally considered balanced. Under normal economic conditions, anything above six months is generally considered a “buyer’s market” and anything below is then considered a “seller’s market”.  However, these are terms used loosely as descriptors. Buyers ultimately set the market price no matter what the inventory numbers are at any particular moment. 

By county in the Orlando MSA for sales compared to a year ago: Seminole County was up 23.11% from last June, Orange County was up 11.39%. Osceola came in up 14.72%, and Lake County was up by 24.26%. No statistics such as these for Volusia or Brevard were made available (Volusia has several different realtor boards with both New Smyrna and Daytona each having their own and Volusia is officially part of the Daytona Beach MSA.  In addition, Brevard has its own Board).

Prices 

The median (usually the average) price of all homes sales rose 7.56% from a year ago to $183,875 which is also a 2.15% increase from June. The Orlando Florida metro area market has now posted positive year-over-year gains in price for 48 consecutive months. 

The year-over-year increase for single family homes was 5.26% while condos increased 10.31%. 

However, remember - the median price above encompasses all sales types. Individual types fluctuate. Sale prices year over year rose in both the Normal and Bank-Owned categories. Normal (no distress) sales rose 1.25% to $202,500 from this time last year. Short sale prices fell 22.55% and Bank-Owned averages increased 13.30% compared to a year ago.   

The difference between the median and average most times is very small – especially as the sample size increases. The technical difference is that the median is the sales price number in the exact middle of the number of sales – that is exactly where half of the sale prices are lower and half are higher. The average price is the total sales prices divided by the total number of sales. The median is less influenced by fringe numbers – ones very large or very small as compared to the usual numbers.  For example, a million dollar sale in a $200,000 neighborhood or a $50,000 sale in the same neighborhood.  Just for completeness – the mode is the sales price number that is repeated most often.

NEW!

The State of Florida versus The Nation

This month compared to one year ago

Check out how the housing market in the State of Florida compares with the U. S. as a whole!

Number of Sales of existing Single Family Homes – FL down 19.60% US up 13.60%

Number of Sales of existing Condos – FL down 14.60%  US up 10.70%

Median Price of existing Single Family Homes – FL up 10.00%  US up 6.60%

Median Price of existing Condos – FL up 7.90%  US up 5.50%

Orlando Area Interest Rates 

The average interest rate for July 2015 was 3.98% down from 4.08% the previous month.   In May it was 3.92 percent.  A year ago it was 4.17 percent. 

Orlando Unemployment 

The latest numbers for the Orlando Florida MSA – for June was 5.1 down from 5.2% in May. A year ago is was 6.1%. The “official” national average is currently at 5.3% .

The statistics cited is provided by the Orlando Regional Realtors Association, of which we are a member.

This report is intended to be for reference and informational purposes only.  The opinions expressed herein are solely those of New Southern Properties Inc. and are opinions. No purchases or investments should be made based solely on this report, this data, or the opinions expressed herein.  Real Estate purchases and investments are complex transactions. You are strongly urged to consult with your financial, legal and real estate consultants before making any real estate purchase or investment.