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Record interest rate ushers in higher median prices, sales

Friday, March 15, 2013  
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Detailed statistical reports

The median price of Orlando homes sold during the month of February leapt nearly 20 percent over February 2012, driven in no small part by a record low interest rate of 3.21 percent that is enabling buyers to afford a little more house, reports the Orlando Regional REALTOR® Association.

The February 2013 median price of $133,000 is 19.82 percent above that of February 2012 ($111,000) and 4.72 percent above that of January 2012 ($127,000).

The jump in median price can be attributed to a mix of factors, explains ORRA Chairman Steve Merchant, broker-owner of Global Realty International.

"We are in a solid seller’s market with minimal inventory and huge demand from buyers seeking to take advantage of interest rates, says Merchant. "Those conditions are encouraging more owners to make their homes available for purchase, and normal homes are generally priced higher than foreclosures and short sales. In addition, that same buyer demand is really driving up the price of foreclosures and short sales, for which heated bidding wars are now routine.”

All sales types experienced year-to-year median price increases in February, with foreclosures leading the way with a 26.71 percent jump. The median price of short sales increased 11.76 percent; normal sales increased 5.69 percent.

Completed Sales

Members of ORRA participated in the sales of 2,203 homes (all types combined) that closed in February 2013, an increase of 11.54 percent compared to February 2012. Single-family home sales increased 16.68 percent, while condo sales dropped 6.69 percent.

Compared to February of 2012, the number of short sales (487) decreased 24.73 percent and the number of foreclosures (521) decreased 2.98 percent. The number of completed traditional sales (1,195), however, is a 51.07 percent increase compared to last year.

Homes of all types spent an average of 84 days on the market before coming under contract in February 2013, and the average home sold for 96.11 percent of its listing price. In February 2012 those numbers were 94 days and 93.38 percent, respectively.

The average interest rate paid by Orlando homebuyers in February, 3.21 percent, set yet another record as lowest average interest rate since ORRA began tracking the statistic in 1989. A year ago, homebuyers paid an average interest rate of 3.92 percent.

Pending Sales

Pending sales – those under contract and awaiting closing – are currently at 8,825. The number of pending sales in February 2013 is 5.59 percent lower than it was in February 2012 (9,348) and 1.33 percent higher than it was in January 2013 (8,709).

Short sales, which take much longer to process from contract to close, made up 61.79 percent of pending sales in February 2013. Normal properties accounted for 25.96 percent of pendings, while bank-owned properties accounted for 12.25 percent.

Inventory

The number of existing homes (all types combined) available for purchase in Orlando is continuing a steady decline that began back in July 2010 at 16,563 and now rests at 7,183. In February 2013, inventory was 22.37 percent less than it was in February 2012.

The inventory of single-family homes is down by 25.40 percent when compared to February of 2012, while condo inventory has decreased by 9.98 percent.

The month-of-supply decreased in February when compared to February 2012: Current inventory combined with the current pace of sales equates to a 3.26-month supply of homes in Orlando right now, while there was a 4.69-month supply in February 2012. There was a 3.64-month supply last month.

Affordability

The February affordability index is 248.38 percent, a decrease of four points from January’s index of 252.38 that is attributed in part to the interest rate decline. (An affordability index of 99 percent means that buyers earning the state-reported median income are 1 percent short of the income necessary to purchase a median-priced home. Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.)

Buyers who earn the reported median income of $54,929 can qualify to purchase one of 4,013 homes in Orange and Seminole counties currently listed in the local multiple listing service for $330,346 or less.

First-time homebuyer affordability in February decreased to 176.63 percent from last month’s 179.47 percent. First-time buyers who earn the reported median income of $37,352 can qualify to purchase one of the 2,873 homes in Orange and Seminole counties currently listed in the local multiple listing service for $199,676 or less.

Condos and Town Homes/Duplexes/Villas

The sales of condos in the Orlando were down 6.69 percent in February, with 321 sales recorded in February 2013 compared to 344 in February 2012.

The most (86) condos in a single price category that changed hands in February were yet again in the $1 - $50,000 price range and accounted for 26.79 percent of all condo sales.

Orlando homebuyers purchased 210 duplexes, town homes, and villas in February 2013, which is a 6.06 percent increase compared to February 2012. Most (27) fell within the $160,000 - $180,000 price range category.

MSA Numbers

Sales of existing homes within the entire Orlando MSA (Lake, Orange, Osceola, and Seminole counties) in February were up by 5.71 percent when compared to February of 2012. Throughout the MSA, 2,666 homes were sold in February 2013 compared with 2,522 in February 2012. To date, sales throughout the MSA are 8.80 percent above this time last year.

Each individual county’s monthly sales comparisons are as follows:

  • Lake: 1,83 percent below February 2012 (375 homes sold in February 2013 compared to 382 in February 2012);
  • Orange: 3.05 percent above February 2012 (1,317 homes sold in February 2013 compared to 1,278 in February 2012);
  • Osceola: 2.33 percent above February 2012 (440 homes sold in February 2013 compared to 430 in February 2012); and
  • Seminole: 23.61 percent above February 2012 (534 sold in February 2013 compared to 432 in February 2012).

This representation is based in whole or in part on data supplied by the Orlando Regional REALTOR® Association and the My Florida Regional Multiple Listing Service. Neither the association nor MFRMLS guarantees or is in any way responsible for its accuracy. Data maintained by the association or MFRMLS may not reflect all real estate activity in the market. Due to late closings, an adjustment is necessary to record those closings posted after our reporting date.

ORRA REALTOR® sales, referred to as the core market, represent all sales by members of the Orlando Regional REALTOR® Association, not necessarily those sales strictly in Orange and Seminole counties. Note that statistics released each month may be revised in the future as new data is received.

Orlando MSA numbers reflect sales of homes located in Orange, Seminole, Osceola, and Lake counties by members of any REALTOR® association, not just members of ORRA.


 

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