Orlando Regional Housing Market Update August 2019

THE ORLANDO FLORIDA

REGIONAL HOUSING

MARKET UPDATE  

August  2019

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, Ocoee, Florida, Geneva Florida, Belle Isle Florida, Maitland Florida, Sorrento Florida, Winter Park Florida, Wedgefield Florida, Avalon Park Florida, and Altamonte Springs Florida. Here are the highlights taken from the Orlando Realtor Regional Board report ending July 2019 (the latest now available):

Inventory

Inventory decreased over the past month to 7,998 units – down from last month. This represents an decrease of less than 1% from last month and a 5.9% decrease from a year ago.  A year ago there were 7,525 units and two years ago there were 9,051 on the market. 

These inventory numbers include all homes: single family homes, condos, duplexes and townhomes. For comparison:  In August   2008, there were 24,834 on the market. In March 2013, which was where inventory bottomed out, there were 6,937. 

Single family home inventory represents the vast bulk of the inventory and is up by 4.0% over last year with 6,265 units on the market at this time. Condo inventory increased 16.0% over last year.  

Homes spent an average of 49 days on the market, three fewer than last month and four more than last year at this time. Two years ago it was 52.   At the current pace of sales, there is is now an overall 2.21 month supply.   

However, the supply varies with price point.  Homes below $300,000 now have a two month supply, but homes above $900,000 now have a nine month supply.  Thus, the former tends to favor the sellers and the latter the buyers.   

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, there are other factors which weigh into supply times.  Primarily location and price point are the two other significant influencers.  Great locations will move faster than the average market and lower price points tend to move faster as well.  

Regardless of what you tend to hear – there is no true Seller’s market - Buyers ultimately set the market price no matter what the inventory numbers are at any particular moment. That is, Buyers decide if they are willing to, or can, pay more, and by how much, in response to demand, inventory, location and price point.

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YOUR HOME OR PROPERTY –

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Sales

There were 3,620 closings (actual sales from MLS listings) in July, a 7% increase over last year at this time. 

Single family home sales increased 7.0% from a year ago with a 6.0% percent increase over last month, and condo sales were up 4.0% compared to a year ago.    

Sales of existing homes in the entire Orlando MSA are up 6.5% from a year ago, but down 4.9% year to date.    

IF YOU ARE LOOKING TO BUY OR SELL

YOUR HOME OR PROPERTY –

PLEASE CONTACT US AND FIND OUT HOW WE CAN HELP!

Prices

The median (usually close to the average) price of all homes sales rose 5% to $247,000 from a year ago.   

The year over year median price for a single family home was also up 5.0% from the previous month to $267,500, but this represents a one percent drop from last month. Condos posted an increase of 8% over last year to $138,000.

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.

Price points and sales pace are heavily influenced by location and price-point market segment.   That is, generally homes in the $250,000 - $350,000 range will sell faster and can sell for more per square foot than a home at the $2 million price point because there are far more buyers capable of affording the lower priced home.  Thus, there is more competition amongst that group vying for that particular home.

If one were to add in the location consideration as well, homes in the most desirable locations can sell for many times more than the same home would sell for in an inferior location.  Of course this multiple times the value factor is diminished the higher the price point.

This can be illustrated in the locations and price points most production builders opt for in Central Florida.  Here, we don’t generally see subdivision production builds of homes in the $1M and up range  - but in the $300s-$500s is fairly common. 

Orlando Unemployment

The latest numbers for the Orlando Florida MSA – for June was 3.1%. The national average is currently at 3.7%. 

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Average Orlando MSA Interest Rates*

 The average interest rate paid in the Orlando MSA has fallen below 4%.  In June it was 3.93% and last month it had fallen further to 3.85%.  Last year at this time it was 4.59% and two years ago it was also 4.01%. Home loan rates tend to generally trend along with the ten-year US Treasury bond markets.  

Market Summaries

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*The interest rate statistic is over all types of loans with varying terms, conditions, circumstances and credit scores, and should be used as trend reference number only.  Consult your lending representative for rates that would apply to you.

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.