Orlando’s housing market just hit a new high.
The Orlando Regional Realtor Association recorded 4,268 existing home sales last month, a 33% surge from 3,204 sales in March 2020. It was the most sales in any month in the Realtor association’s records, which go back to 1995. The historic month shows Central Florida’s hectic housing market is not slowing down even as the number of available homes fell to a new low. Home inventory is down 61% since last March, and there is only a three-week supply of homes on the market in the region. Meanwhile, home prices continued to climb, with the median sales price up 12% year-over-year to $285,000.
The Covid-19 pandemic accelerated the migration of new residents to Central Florida and caused many former Floridians to move back, Kelly Price & Co. LLC Sales Associate Chenenne Gonzalez told OBJ. A rapid pace of sales and limited options contribute to the escalating prices. “People are paying whatever it takes to get into a home.” However, low mortgage rates and Orlando’s relatively low cost of living compared to the Northeast and West Coast appear to trump the increasing home prices. Experts believe those trends will continue, keeping Orlando a seller’s market for the foreseeable future.
For example, interest rates are expected to stay low enough in 2021 to encourage people to finance home purchases, FBC Mortgage co-CEO Joe Nunziata said. “We feel that this is going to be a great year. Rates have crept up a little bit, but they’re still in a great spot. In Central Florida, once attractions and hospitality comes back, more people will be looking to buy a house.” Sustained price increases due to dwindling home supply would price out some would-be homebuyers, said University of Central Florida economist Sean Snaith. However, Snaith said the fundamentals behind Florida home demand, including in-migration and low interest rates, are unlikely to change in the next 12 months.
In the meantime, house hunters face stiff competition to buy a home. The springtime often brings an uptick in the number of people listing their homes, but others may still be wary of the economic outlook as the pandemic continues to cause uncertainty, Lake Mary-based Premier Sotheby’s International Realty agent Kristen Wenderfer told OBJ. Either way, the market is expected to remain competitive, said Natalie Arrowsmith, 2021 Orlando Regional Realtor Association president, in the association’s April 15 report.
“The shortage of homes for sale is so severe, houses are under contract almost as soon as they’re listed. Even though we’re seeing more listings ahead of summer, those homes are getting four to five offers once they’re on the market.” Trends in the residential real estate market are important, as every home sale in the state has an estimated local economic impact of $90,300, according to the National Association of Realtors. In addition, the housing market often is considered a reflection of the local economy's overall health.