The Orlando Florida Regional Housing Market Update April 2018

THE ORLANDO FLORIDA

REGIONAL HOUSING

MARKET UPDATE  

April 2018

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, Geneva Florida, Belle Isle Florida, Maitland Florida, Sorrento Florida, and Altamonte Springs Florida. Here are the highlights taken from the Orlando Realtor Regional Board report ending March 2018 (the latest now available):

The Short Story

Thus far into the spring selling season, the uptick in inventory numbers typical of this time of year has failed to materialize.  The increase from last month’s inventory numbers in all of the Orlando MSA to this month’s inventory numbers was only a net gain of four – 4 – units and there has been only a net gain of 106 since January. Further, these numbers in the aggregate continue to drift not too far above the March 2013 inventory low point.  Meanwhile, interest rates have retreated a bit from the recent run-up and prices continue to rise. New housing starts from a variety of builders continue to pop up around the area.    

Inventory

Inventory went up by a whopping four units this month from 7,706 to 7,710.   This is a 9.7% decline over this time last year when there were 8,537 homes on the market.  Just two years ago there were 10,583 on the market.     

These inventory numbers include all homes: single family homes, condos, duplexes and townhomes. For further 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 is down 6.1% from a year ago, and the condo inventory is down by 24.2%.   

Short sales and foreclosures have had no impact on the overall Central Florida housing market for some time now. Therefore, statistics associated with them are no longer included in this report.  

Homes spent an average of 60 days on the market, 4 days fewer than last month, and four days fewer than a year ago and 10 days less than two years ago. At the current pace of sales, there is a only a 2.02 month supply! 

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. 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, as inventory numbers continue tighten.

IF YOU ARE LOOKING TO BUY OR SELL

YOUR HOME OR PROPERTY –

PLEASE CONTACT US AND FIND OUT HOW WE CAN HELP!

Sales

There were 3,508 closings (actual sales) in March, up .09% from a year ago and up 38.2% from last month.         

Single family home sales decreased .4% and condo sales were up 3.2% compared to a year ago.   

Of the sales in March, 96.7% were normal, arms-length transactions – indicative of a normal housing market as it relates to the quality of buyers.  

Sales of existing homes in the entire Orlando MSA were down 1.9% from a year ago.  This may reflect the impact of the many new home communities that have been developed over the past few years.  

The average home sold for 97.5%, of its then-current listing price. However, “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.

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 5.5% from a year ago to $230,000, and a .4% increase over last month.  Seventy-nine of the past 80 months have seen year-over-year price increases in the Orlando MSA.  

At a 99.1% overall increase, the overall median price is now just shy of doubling since July 2011.      

The year over year median price for a single family home increased 6.4% as compared to last year to $249,900. Condos posted an increase of 19.4% over last year to $122,900.

Single family homes have now posted 80 consecutive months of year over year price increases.

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 February was 3.3%.  The “official” national average was unchanged at 4.1% for March – where it has been since October 2017.  

Average Orlando MSA Interest Rates*

The average interest rate paid in the Orlando MSA last month was 4.29%, down from 4.39% but still significantly up from the 3.96% in November of last year. A year ago it was also 4.29% and two years ago it was 3.70%. Home loan rates tend to generally trend along with the ten-year US Treasury bond markets.  

Market Summary

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*The interest rate statistic is over all types of loans with varying terms and conditions 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.