New data shows for the first time since 2012 retail home prices are falling in metro Orange & Osceola counties in Florida.
In a statement from Zillow; after seven years of month-over-month increases, the median price of a Central Florida home dropped recently according to our real estate data tracking. It shows the end of an incredible 86-month streak where the value of the median home shot up 94% to $239,200.
It’s doubtful that home prices will drop to levels that we had in 06 to 09 but this market is so crazy that one doesn’t know.
The average sale price of an existing home in the region fell $5,000 to $255,000 from April 2018 to April 2019 and so far for 2019, the total sales are down 9.2% across Central Florida according to the Orlando Regional Realtor Association.
In the last few years one thing that has helped move up home values was the lack of salable inventory, that is slowly coming to an end with more homes now coming on the market. The other problem we have is the artificial home values in some areas. Now that more inventory is coming on the MLS we are seeing longer times on the market to get a contract and homes are getting low offers. Once those sellers that really need to sell accept offers, they will be setting new lower benchmarks for their area.
Frank Nothaft, with housing data firm CoreLogic said in a report that Orlando’s softening real estate market follows a nationwide trend, where home price growth has been cut in half to around 5 percent per year. Areas with growing economies and booming populations have seen the fastest spike in prices, particularly cities such as San Francisco, Seattle, Dallas and Orlando. Orlando’s home price growth was so pronounced because prices fell so low after the housing bust. Now home price growth is returning to normal long-term rates, he said.
Another issue stalling home re-sales is the New Construction competition, new starts are at their largest peek since the crash in 06. Even where I live a new community has gotten the green light to start approx. 3000 residence community and will probably start in the high $250K’s. We all know there is nothing not to love about a new home, get it the way you want, choose your color, finishes etc. What’s a re-seller to do? Make your home as neutral as possible, a clean and uncluttered home will show best. Buyers love a home that is move in ready, but there are always many that will want to make changes and improvements to suit their needs.
The last part of the puzzle that everyone forgets is that we are quickly coming into the election season. Election time always reeks havoc on the markets. People need certainty and you can’t get that during an election period.
Worst case scenario if you can’t sell but still like the area is to refi and make changes to your current home. The interest rate is now again for the first time in a while, under 4%. But, do not over improve your home for the neighborhood. The last thing you want to do is to have the best home in the neighborhood.
Hope you enjoyed this little bit about the latest housing market news.