Lack of inventory continues to squeeze Orlando home prices higher
Monday, July 15, 2013
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Paper-thin inventory is continuing to bolster Orlando’s overall existing-home median price, which has cleared the $150,000 mark for the first time since December 2008, reports the Orlando Regional REALTOR® Association.
The median price of existing homes sold in Orlando during the month of June rose 22.40 percent — to $153,000 — when compared to June 2012 and 5.41 percent compared to May 2013. Orlando’s median price has risen 42 percent since January of 2012 and 61 percent since January 2011.
"Lack of inventory is continuing to drive prices up by forcing would-be buyers to duke it out over properties,” explains ORRA Chairman Steve Merchant, broker-owner of Global Realty International. "The median price increase is also a reflection of a transition that is taking place. As more homeowners are recognizing that now is a great time to sell and are adding their homes to the inventory, we’re shifting from a market dominated by lower-priced distressed sales to one dominated by higher-priced normal sales.”
In addition to the overall median increase, each individual sales type experienced a year-to-year median price increase in June, with foreclosures leading the way with a 24.28 percent jump. The median price of short sales increased 4.55 percent; the median price of normal sales increased 13.85 percent.
Members of ORRA participated in the sales of 2,563 homes (all types combined) that closed in June 2013, a decrease of 1.95 percent compared to June 2012. Single-family home sales increased 1.28 percent in June 2013 compared to June 2012, while condo sales decreased 15.84 percent.
Compared to June of 2012, the number of short sales (478) decreased 35.84 percent and the number of foreclosures (465) decreased 29.44 percent. The number of completed traditional sales (1,620), however, is a 33.88 percent increase compared to last year.
In June, short sales and foreclosures made up 36.79 percent of the entire sales pie, while normal sales made up 63.21 percent. Last year in June, those percentages were 53.71 percent and 46.29 percent, respectively.
Homes of all types spent an average of 66 days on the market before coming under contract in June 2013, and the average home sold for 97.14 percent of its listing price. In June 2012 those numbers were 85 days and 94.88 percent, respectively.
The average interest rate paid by Orlando homebuyers in June was 4.25 percent. Last month, homebuyers paid an average interest rate of 3.64 percent; this month last year, homebuyers paid an average interest rate of 3.80.
Pending sales – those under contract and awaiting closing – are currently at 8,441. The number of pending sales in June 2013 is 1.31 percent higher than it was in June 2012 (8,332) and 2.20 percent lower than it was in May 2013 (8,631).
Short sales made up 56.30 percent of pending sales in June 2013. Normal properties accounted for 30.79 percent of pendings, while bank-owned properties accounted for 12.91 percent.
The number of existing homes (all types combined) available for purchase in Orlando is 6.39 percent below that of June 2012 and now rests at 7,616. Inventory increased in number by 344 properties over last month.
The inventory of single-family homes is down by 9.79 percent when compared to June of 2012, while condo inventory is up by 2.56 percent. The inventory of duplexes, townhomes, and villas is up by 12.65 percent.
Current inventory combined with the current pace of sales created a 2.97-month supply of homes in Orlando for June. There was a 3.11-month supply in June 2012 and a 2.44-month supply last month.
The June affordability index is 190.84 percent, a decrease of 25.58 percentage points from May’s index of 216.42. (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.)
Steady increases in median price have caused the affordability index to drop 62 points since January 2013.
Buyers who earn the reported median income of $55,157 can qualify to purchase one of 3,742 homes in Orange and Seminole counties currently listed in the local multiple listing service for $291,983 or less.
First-time homebuyer affordability in June decreased to 135.71 percent from last month’s 153.90 percent. First-time buyers who earn the reported median income of $37,507 can qualify to purchase one of the 2,445 homes in Orange and Seminole counties currently listed in the local multiple listing service for $176,487 or less.
Condos and Town Homes/Duplexes/Villas
The sales of condos in the Orlando area were down 15.84 percent in June, with 356 sales recorded in June 2013 compared to 423 in June 2012.
The most (72) condos in a single price category that changed hands in June were yet again in the $1 - $50,000 price range and accounted for 20.22 percent of all condo sales.
Orlando homebuyers purchased 227 duplexes, town homes, and villas in June 2013, which is a 3.81 percent decrease compared to June 2012. Most (34) fell within the $100,000 - $120,000 price range category.
Sales of existing homes within the entire Orlando MSA (Lake, Orange, Osceola, and Seminole counties) in June were down by 3.38 percent when compared to June of 2012. Throughout the MSA, 3,089 homes were sold in June 2013 compared with 3,197 in June 2012. To date, sales throughout the MSA are 7.96 percent above this time last year.
Each individual county’s monthly sales comparisons are as follows:
- Lake: 22.79 percent above June 2012 (501 homes sold in June 2013 compared to 408 in June 2012);
- Orange: 6.11 percent below June 2012 (1,553 homes sold in June 2013 compared to 1,654 in June 2012);
- Osceola: 10.30 percent below June 2012 (444 homes sold in June 2013 compared to 495 in June 2012); and
- Seminole: 7.66 percent below June 2012 (591 sold in June 2013 compared to 640 in June 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.