Proliferation of “normal” sales lifts home prices 29 percent
Monday, September 16, 2013
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The median price of existing homes sold in the Orlando area during August leaped nearly 29 percent over the median price in August of 2012.
According to ORRA Chairman Steve Merchant, owner-broker of Global Realty International, the increase in median price correlates to the continued domination of higher-priced "normal" sales over foreclosures and short sales.
"Normal transactions made up 67 percent of all transactions in August," says Merchant. "In addition, traditionally owned homes now make up 70 percent of available inventory, which indicates a much healthier market than when distressed sales ruled the closing table."
The August 2013 median price of $155,000 is 28.84 percent higher when compared to August 2012 and 1.27 percent lower when compared to July 2013. Orlando’s median price has risen 22.05 percent since January of 2013 and 43.52 percent since January 2012.
In addition to the overall median increase, each individual sales type experienced a year-to-year median price increase in August, with foreclosures leading the way with a 17.65 percent jump. The median price of short sales increased 5.45 percent; the median price of normal sales increased 13.92 percent.
Members of ORRA participated in the sales of 2,824 homes (all types combined) that closed in August 2013, an increase of 4.52 percent compared to August 2012 and a decrease of 4.53 percent compared to July 2013. Single-family home sales increased 7.89 percent in August 2013 compared to August 2012, while condo sales decreased 15.90 percent.
Compared to August of 2012, the number of short sales (475) decreased 38.79 percent and the number of foreclosures (471) decreased 25.36 percent. The number of completed traditional sales (1,878), however, is a 45.02 percent increase compared to last year.
In August, short sales and foreclosures made up 33.50 percent of the entire sales pie, while normal sales made up 66.50 percent. Last year in August, those percentages were 52.07 percent and 47.93 percent, respectively.
Homes of all types spent an average of 67 days on the market before coming under contract in August 2013, and the average home sold for 96.90 percent of its listing price. In August 2012 those numbers were 79 days and 96.28 percent, respectively.
The average interest rate paid by Orlando homebuyers in August was 4.64 percent. Last month, homebuyers paid an average interest rate of 4.51 percent; this month last year, homebuyers paid an average interest rate of 3.78.
Pending sales – those under contract and awaiting closing – are currently at 7,519. The number of pending sales in August 2013 is 19.69 percent lower than it was in August 2012 (9,362) and 5.89 percent lower than it was in August 2013 (7,990).
Short sales made up 55.13 percent of pending sales in August 2013. Normal properties accounted for 30.67 percent of pendings, while bank-owned properties accounted for 14.20 percent.
The number of existing homes (all types combined) available for purchase in Orlando is 5.51 percent above that of August 2012 and now rests at 8,576. Inventory increased in number by 477 properties over last month.
The inventory of single-family homes is up by up by 5.26 percent when compared to August of 2012, while condo inventory is up by 4.61 percent. The inventory of duplexes, townhomes, and villas is up by 9.98 percent.
Current inventory combined with the current pace of sales created a 3.04-month supply of homes in Orlando for August. There was a 3.01-month supply in August 2012 and a 2.74-month supply last month.
The August affordability index is 180.30 percent, a minimal decrease from July’s index of 180.30. (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 $55,271 can qualify to purchase one of 4,147 homes in Orange and Seminole counties currently listed in the local multiple listing service for $279,465 or less.
First-time homebuyer affordability in August decreased a tiny fraction to 128.21 percent from last month’s 128.38 percent. First-time buyers who earn the reported median income of $37,584 can qualify to purchase one of the 2,500 homes in Orange and Seminole counties currently listed in the local multiple listing service for $168,921 or less.
Condos and Town Homes/Duplexes/Villas
The sales of condos in the Orlando area were down 15.90 percent in August, with 386 sales recorded in August 2013 compared to 459 in August 2012.
The most (63) condos in a single price category that changed hands in August were yet again in the $1 - $50,000 price range and accounted for 16.32 percent of all condo sales.
Orlando homebuyers purchased 304 duplexes, town homes, and villas in August 2013, which is a 14.72 percent increase compared to August 2012. Most (48) fell within the $120,000 - $140,000 price range category.
Sales of existing homes within the entire Orlando MSA (Lake, Orange, Osceola, and Seminole counties) in August were up by 0.75 percent when compared to August of 2012. Throughout the MSA, 3,340 homes were sold in August 2013 compared with 3,315 in August 2012. To date, sales throughout the MSA are 8.58 percent above this time last year.
Each individual county’s monthly sales comparisons are as follows:
- Lake: 5.05 percent above August 2012;
- Orange: 3.79 percent below August 2012;
- Osceola: 3.72 percent above August 2012; and
- Seminole: 7.59 percent above August 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.