Well my world premier video aired last night on HGTV's House Hunters, and friends from all over the country watched with me. I want to send a big thank you out to Doug and Lisa, the buyers, because if it was not for them I would not have had the opportunity. I would also like to thank the crew and producers who managed to keep me from looking too goofy. I didn't even look that fat - yeah! If you did not get to see last night's show, it will be on several more times over the next couple of months. You can check the HGTV website for other dates and times.
Today, it is back to reality. I have a walk-through this morning, closing this afternoon, contract extension, a buyer's CMA, and an offer to follow up on. If it was only as easy as it is on tv. Show three houses, pick one and move in. For more on buying and selling real estate, check out my homepage www.davidwelch.com. I have a number of tools right on the main page for buyers and sellers. Right at the very top of the page you can search for Orlando area real estate. This is a new tool I have just added to give you a complete listing search of our area. Sellers, I also have tools right on the front page for valuing your home as well as several pages devoted to helping you with marketing tips. Let me know how I can help you with all your real estate needs.
Which house will the choose? I cannot say, because I am sworn to secrecy. Watch HGTV's House Hunters tonight at 9:00pm (check your local listings outside Orlando) to find out which home Lisa and Doug will pick. I would love feedback from everyone on my performance as "the Realtor". I am not only a Realtor in real life, but after tonight I can say that I play one on tv too.
I am also pleased to say that my blog is getting a lot of attention. One of my posts has been quoted by the Colorado Springs Business Journal; I have had my posts quoted in the Orlando Sentinel; and I am now a featured blogger at Realtor.com - the number one real estate website in the world. Go to Talk.Realtor.com, and look for me on the right side of the screen. My posts are regularly featured, and I have also been asked to answer questions on Ask A Realtor. My blog is also in the running as one of the top blogs in Orlando. Please vote for me by clicking on the Orlando Sentinel.
I sell real estate here in Orlando too, so tune in tonight then give me a call tomorrow and we will talk about your real estate needs.
Tomorrow, Thursday November 12th at 9:00pm look for me on HGTV's House Hunters. The last time I checked, my episode was still scheduled to air at that time. Check your local listings though to make sure. I want to thank Lisa and Doug for asking me to be part of this home search, and also for applying to be on the television show. I would not have thought to apply to be on the show myself. Since being part of this, I have been checking and House Hunters has actually already been to Orlando a few times this year. My friends at Talk.Realtor.com tell me that Orlando is pretty much at the top of the list for real estate searches.
I cannot think of a better place to be practicing real estate. Despite all the negative press you read every day, the bad times only last for a little while. I suspect we may very well be dealing with foreclosures for another three years as the banks work through their backlog. In the mean time, we are writing 3,500 contracts (not offers) a month and closing more than 2,000 transactions. The closings are what I would expect for our market, and the contracts are exceptionally strong numbers. I believe these numbers indicate a renewed demand in Orlando real estate. It is no wonder Orlando real estate searches have been so strong on Realtor.com and so many House Hunters episodes have been filmed here in The City Beautiful.
Orlando real estate prices have been very stable for seven months now bouncing along the bottom between $125,000 and $135,000 since April. With the big push by first time home buyers to get into a home before the November 30th tax credit deadline, I am expecting prices to take a tumble this month. First time home buyers purchase less expensive homes for the most part, so I expect prices to be a bit lower in November and probably December. Looking at the pending inventory of nearly 9,000 homes, there are 3,775 that are expected to close this month with a median list price of $124,500. There are a couple of factors to consider though. First, 3,775 will not close this month. Looking at recent history, we can probably expect about 2,000 of them to close including the 250 or so that have already closed. The other consideration is the role short sales will play regarding prices. A lot of the ones that will not close are short sales which have much lower prices than "normal" sales. However, the short sale prices are typically much higher than the REO's. In the end it has typically been a wash with short sale prices hovering just below the overall median price.
With the list price running at $124,500, I expect our median sales price to be around $120,000 this month. While the impending end of the tax credit might have accounted for more lower priced sales this month, the extra competition for well priced homes likely pushed offers closer to the asking price. With the extension of the tax credit, I suspect many of these sales will end up closing in December as the urgency to close by November 30th wanes. With the extension and expansion of the tax credit, I am expecting the tremendous demand continuing well into next year. Until hiring picks up though, look for our prices here in Orlando to stay in a very affordable range. I do believe that we will see a slight tick up in hiring in the first quarter. I believe we may already be seeing a little improvement in hiring this quarter, but nothing to get too excited about yet.
By the way, watch for me on HGTV's House Hunters this Thursday November 12th at 9:00pm. Check your local listings.
The extension and expansion of the home buyer tax credit is on it's way to the White House for the President's signature as part of a broad financial package that will extend unemployment benefits. Notice that I did not call it a first time home buyer credit, because it is more than that with the expansion. First time home buyers (those who have not owned a home in the past three years) still qualify for up to $8,000. The income restrictions have been raised significantly to $125,000 for singles and $225,000 for joint tax filers. However a limit of $800,000 has been placed on the value of the home purchased. So, if you have been waiting to cash in that trust fund to purchase your first $1 million McMansion try scaling back to $800k to qualify for the credit. This latest extension of the credit begins December 1, 2009 and is good for closings through June 30, 2010. You must be under a binding contract by April 30, 2010 however to qualify for the credit.
Repeat purchasers get a little less back from Uncle Sam. If you have owned and used a home as your principal residence for five consecutive years out of the last eight, you can qualify for a credit of up to $6,500. The same income and home price restrictions apply. It is also important to note that the credit is only for primary residences. Repeat purchasers cannot use the credit for a second home. I cannot understand why this was important to law makers. Frankly, if you look at the states that need home buyers the most, they are also the states that probably have the greatest number of second home buyers (Florida, Nevada and California). There are other provisions in this legislation to help deter fraud, but I have not heard specifically what they are. Personally, I see the April 30 to June 30 period as having a tremendous potential for fraud as buyers and sellers once again come under pressure of the deadline.
On a completely unrelated subject; my House Hunters episode is tentatively scheduled to air November 12, 2009 at 9:00pm. Check you local listings.
October closed out our fifth month in a row with over 2,000 closed sales. So far 2,004 have been posted for the month with a median sales price of $130,500. We have been hovering around $130,000 for seven months now ranging between $125,000 and $135,000. Of the 2,004 closes sales 832 or 41.5% were bank owned, almost 21% were short sales with 415 and the remaining 757 were "normal" sales. As usual we are seeing a pretty big difference in the median prices of these three groups. REO's came in at $80,000 while short sales were just under the over all median with $127,000 and "normal" sales had a median sales price of $180,000. The 415 short sales closed represent only about 7.5% of the total number of short sales under contract.
Total pending sales stand at 9,072 with 1,782 being REO'snd a whopping 5,544 classified as short sales. That leaves on 1,746 "normal" pending contracts. The "normal" sales tend to be higher priced homes, but also tend to close a bit more quickly once they are under contract. Short sales continue to be a drag on the entire real estate system taking six to eight months to obtain approval. The total inventory is down slightly to 15,778 with 1,255 bank owned properties and 5,583 short sales. Combined distressed properties represent just over 43% of our active inventory.
Buyer beware. The tax credit has not I repeat has not been extended yet. It is looking more likely with key Senators agreeing to extend the current credit through the end of April and even as far as July 1, 2010. There is also an agreement to expand the qualifications for the credit to higher income buyers and repeat buyers who have lived in their home for five consecutive years out of the last eight. Right now this agreement has not even been voted on in the Senate. This is just a tentative agreement to go forward with legislation. There are still a number of obstacles in the way including the House of Representatives where concern over fraud from the exisiting program may hold things up. It is estimated that up to 100,000 of the tax credits submitted may have been fraudulent. That is a lot of zeros, and adds up to an $800 million ripoff.
Many in the Realtor community believe that it is just a matter of getting some fraud protections in place before the credit is extended and expanded. For now, it is not a done deal so govern yourself accordingly. Get your deal closed by November 30, 2009. Be careful with that date too, because many lenders are taking an additional day to fund transactions. November 30th is also just after the Thanksgiving holiday. A lot of lenders and title agents like to take that time off too. I would really recommend trying to close before Thanksgiving just to be safe. If the tax credit is extended and expanded, I will have the details on my tax credit web page.
In the last seven days there were 12 sales in Baldwin Park ranging in price from $431,300 to $714,900. So far this month there have been 27 contracts written on two condos, one townhome and 24 single family homes. The prices have ranged from $210,000 to $799,000 with a median list price of $449,900. Currently, there are 99 active listings in Baldwin Park and 62 pending sales with 151 closed so far this year. The median list price of the active listings is $437,500. The properties receiving contracts have a median list price of $349,500 while the closed sales have posted a median sales price of $332,000 on a list price of $359,900. The most recent month seems to be bucking the trend for the year with a median list price $80,000 and $90,000 higher than closed sales and pending sales thus far.
Overall that does not appear to be the case. Orlando Realtors have written 3,516 new contracts in October that are still pending (3,337) or closed (179). Of these only 943 or 27% are "normal" sales with bank owned accounting for 34% or 1,183 contracts and the remaining 1,392 almost 40% categorized as short sales. The median list price of the contracts this month is down around $117,900 which is far below the median sales price of $129,900 so far this month. This is probably in part due to the last big push by first time home buyers to take advantage of the tax credit expiring at the end of next month.
I posted on Twitter the other day that it was 90 degrees with the wind chill here in Orlando. Several people liked that. Our sales are continuing to persist like the summer time weather. We have over 1,500 closed sales so far in October, and it looks like we will have our 5th month in a row with more than 2,000 sales and our 7th month with a median sales price hovering around $130,000. It would be even hotter if every contract we write actually closed. Since April we have been writing more than 3,300 contracts each month with just over 2,000 getting to the closing table. Short sales are still slow to close with well over 5,000 pending of the 9,000+ contracts pending in our market place. REO's can be a little challenging, but close almost as well as "normal" sales. I can't remember if I have had a closing this year that actually happened on time because of delays in financing. This too shall pass, but I hope the strong demand continues for a while. Our inventory level seems to have leveled off just under 16,000 which is just about an eight month supply. First time buyer tax credit is set to expire in just over one month. I do not think we will notice much difference in demand here.
Mary Shanklin covers the real estate market for the Orlando Sentinel, and had a great article this morning on the state's attempt to turn the tax credit into down payment assistance. When this went into effect back in the summer, I checked with every lender I know. Every one of them had questions about how the assistance was going to be administered. Some were really trying to figure it out, and others just gave up immediately. With millions of dollars going unused, it appears to be another example of government cheese. If you remember back in the 80's the government gave away cheese. It was a program that really did not seem to help anyone other than the late night comics looking for good joke.
Down payment assistance for first time home buyers is not a joke. I believe the biggest obstacle to home ownership for most first time home buyers is the down payment. The FHA minimum down payment on the median priced home in Orlando of $130,000 is $4,550. Add to that closing costs that could also be around $4,500, and that is $9,000 the buyer needs to get into their first house. Many sellers are willing to put up the 3% toward the buyers closing costs, but well priced properties are frequently drawing multiple offers. The buyer with more cash wins that contest more often than not. Fully funding the existing state and local down payment assistance programs would be a better use of money than the tax credit. Some argue that the credit is supposed stimulate purchases after the closing of the home, but if the buyer does not have the cash to close in the first place there won't be a sale. Existing systems, processes and procedures are already in place, they just lack funds. We don't need more cheese, we need solutions that work.
Orlando Real Estate, news, statistics, marketing reports, insight, opinions. Orlando real estate includes, Winter Park Windermere, Apopka, Ocoee, and Winter Garden, as well as Conway and Dr. Phillips areas of Orlando.
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