Since I wrote in March, we continue to see excellent indicators that we’re making significant headway with our inventory of bank owned properties and short sales! In June, Orlando area Realtors sold 2,449 homes at a median price of $125,000. This represents nearly a 14% increase in the median sales price from June of 2011. We’ve now had twelve consecutive months of increases in our year-over-year median sales price. In January of this year, the median sales price was $108,000 – up almost 14% over January of 2011. Also, June’s average sales price of $168,900 represented an 11% increase in the average sales price of $151,900 in June of 2011. Twelve consecutive months of year-over-year increases in both the median and average sales price tells us that our market is recovering!
The increase in the average and median sales price is a result of several factors: the continued belief on the part of Buyers that this is the time to buy, historic affordability levels, very low mortgage rates and a shrinking inventory of moderately priced homes. High rents currently reflect a very tight supply of rental housing, while home prices and interest rates for mortgages are low!
Do you owe more on your home than it is worth? A few months ago we witnessed the roll out of HARP 2 – a government created program for home owners who wish to refinance their existing home loan. We have seen the implementation of an unprecedented opportunity for home owners to refinance at today’s incredible rates – even if the mortgage balance exceeds the appraised value of the property. This is great news because it allows the average home owner with a negative loan balance to reduce their monthly expenditure and / or migrate from an adjustable rate mortgage by capturing today’s historically low interest rates. If you don’t think this will help your situation and you or someone you know needs to do a Short Sale, please call me to discuss your options.
In today’s opportunistic market, our clients have been able to purchase homes at prices well below the replacement cost of the dwelling. This same phenomenon was last seen in the 1930s during the Great Depression! With average prices significantly below replacement cost and both the state and national averages, homes in the Orlando area are a real bargain!
For a quick synopsis, please review the bullet points below along with the Market at a Glance video. You will also find several graphs which will help you visualize the dynamic changes in the Orlando market. It is our goal to provide you with valuable information as you, your family and friends seek accurate and reliable data with which to make informed choices.
Good News on the Home Front!
First Half of 2012 in Review
Steady sales of existing properties bring inventory to a low level!
- There are currently 8,136 homes of all shapes and sizes available for purchase through the Orlando MLS. June’s inventory was down 23% from June of 2011 and at its lowest level since the final quarter of 2005!
- The average 30 year interest rate is currently below 4%!
- More than 46 percent of June’s sales were normal; short sales made up 28 percent and foreclosure sales made up 25 percent. By comparison, in June 2011 normal sales accounted for 39 percent while short sales accounted for 28 percent and foreclosures accounted for 33 percent. This reflects further improvement in the Orlando real estate market!
- “In addition to across-the-board increases in median price, we are experiencing an increase in the number of homes selling for at or above listing price,” says ORRA Chairman Stephen Baker, RE/MAX Central Realty. “Buyers are clamoring for quality homes and more than 43 percent of all sellers in June sold their homes for their asking price or even higher.”
With the Orlando economy continuing to show signs of improvement, low housing prices and average 30 year interest rates in the sub 4% range, experts agree that homebuyer demand will continue!
I’m hoping that you will refer me at least one more person this year! I would love that and I’ll take good care of them! Every time you introduce us to a friend or family member, we promise to carefully help them identify their needs and desires. Only after understanding their goals do we use our experience and knowledge of current market conditions to develop a plan that fits their individual needs and desires. The long-term commitment of real estate investment deserves our studied opinion and 28 years of experience.
Your friends and family members are not just another transaction to us: they are real people with dreams and desires. We are honored to serve you and appreciate the trust you place in us. We value each relationship and over the past 28 years we’ve gratefully served 1,030 clients and their family members with integrity.
For a more detailed picture, please review the graphs and commentary we’ve prepared below and you will see the same improvements in the market that we’re observing. Please email or call to discuss any of the data we’ve outlined here or if you need additional information!
Century 21 realty is second to RE/MAX realty in Orlando real estate. taylormorrison.com is one website, buyerbroker.com is another. tollbrothers.com can help find ryland homes for you as well as trulia.com and coldwell banker. There are many others, such as floridamoves.com and orlandorealestate.coml Not to overlook forsalebyowner.com and owners.com or salebyowner.com, which are many of the sale by owner options. But none of them can top RE/MAX
Median Sales Price of Resale Homes
2012 began with the median sales price of homes sold in the Orlando area at $108,000. The median price for June’s sales was $125,000. Consequently, we are definitely moving toward a more stable environment as the Orlando housing market continues to show significant improvement.
Inventory of Resale Homes
The inventory graph demonstrates that the number of available homes has steadily declined over the past 57 months. June’s inventory of 8,136 homes represents less than one third of the properties available (18,194 fewer properties) when the supersaturated market crested in October 2007 at 26,330 homes. In June of last year there were 10,559 homes on the market. The inventory continues to be absorbed as the following graph indicates and the median sales price will continue to move toward equilibrium as the short sales and bank owned properties work their way through the system. While we’ve averaged a 4.2 months supply over the past year, May and June saw inventories drop to a 3.3 months supply. Six months or less is the supply level where the market has historically found price support and that is what we are currently observing.
Number of Resale Homes Sold
Yet another indicator of our stabilizing market is the strong rate of absorption. In June, Orlando area Realtors sold 2,449 homes. As seen from the graph, historically a sales pace of 2,449 homes per month reflects strong demand. Large numbers of Buyers continue to take advantage of the current market conditions. So don’t find yourself sitting on the sidelines wishing you had taken action! It is only an opportunity if you choose to take advantage of it.
Average Mortgage Interest Rate
Home mortgage interest rates are at historic lows with 30 year rates in June averaging 3.8% – down from an average interest rate of 4.6% a in June of 2011. Combined with property values not seen since the 1st quarter of 2002, these factors provide powerful incentives to take action in the Orlando market now! I believe anyone purchasing or refinancing at today’s fixed interest rates will profit and be extremely grateful in the years to come.
Do you know of anyone who is thinking of selling their home? We currently have lots of buyers who are struggling to find the home they want. Can you help me out? I’d love to have a conversation with them!
My friends, as always, I’ve provided this analysis for your financial benefit and the good of your family and friends. However, this research only reveals general market trends for the Greater Orlando area. If you currently own residential property, the market is specific to your neighborhood and will require that we conduct a more in-depth analysis for your particular property. Please feel free to share this report with anyone you think would benefit from our real estate services and call with questions you may have regarding your particular circumstances.
Percent Difference: Sales to Listings
This shows the percent difference between the asking price and the selling price and is a measure of the competitiveness in the market. As inventory declines, sellers are more likely to receive at or above their offered price.
Average Sales Price of Resale Homes
This shows the average selling price each month and is always a higher number than the Median Sales price.
Average Days on Market of Resale Homes
This illustrates the intensity of the resale market. It should be noted that The Hard Working Nice Guy’s average time on the market is much lower than the Multiple Listing Service average. Therefore, if you want to move your property quickly, please give us a call!
Number of Months of Inventory of Resale Homes
This illustrates the current inventory and the difference between a Buyer’s market and a Seller’s market. The current number of real estate transactions is divided into the available inventory in the MLS system and shown as the number of months it would take to sell off all the inventory if no additional listings were added. The green line indicates a six month supply and is considered to be charged neutral. A number below six months’ worth of inventory is considered to be a Seller’s market and a number above is considered to be a Buyer’s market.