Wave of Sales in the Pipeline Buoys Orlando Housing Market

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(News Source: Orlando Regional Realtor Association)
 
(ORLANDO, FL) -- Members of the Orlando Regional Realtor Association in May sold nearly 38 percent more homes than in May of last year, contributing to the area's year-to-date sales increase of 44 percent.
 
There were 1,854 closings in May, which brings the year's total to 7,834; a total of 5,462 homes had changed by this time last year. Of those May sales, 50.97 percent of the homes were either bank-owned (795) or distressed (150). The remaining (909) "normal" sales made up 49.03 percent.
 
Bank-owned and distressed home sales have an influence on Orlando's reported median price. The median price of all Orlando homes sold in May is $130,000 (a 38.51 percent decrease compared to May 2008), but the median price for "normal" sales is $165,000. The median price for bank-owned sales is $82,000 and the median price for distressed sales is $140,000.
 
"There are two levels of pricing in the current market;" explains ORRA President Les Simmonds, L.G. Simmonds Real Estate Corp. "Traditional homes in good condition have held their value much better, so owners shouldn't be overly concerned about median prices. Most sellers can expect a good return if they've been in their homes for a normal period of homeownership and haven't excessively tapped their equity."
 
In addition to an increase in completed sales in Orlando, there is more than double the number of homes currently awaiting closings (6,603) than in May of last year (3,225). Those pending sales, of which 3,455 are homes that came under contract in the month of May alone (the most in one month this year), are forward-looking indicators of an improving market.
 
The area's average interest rate increased in May to 4.90 percent, up from 4.86 percent in April and 4.67 percent in March. This historically low interest rate contributes to Orlando's affordability index, which continues to hover near the 200.00 percent mark, 197.65 percent to be exact. (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 $52,364 can qualify to purchase one of 10,609 homes in Orange and Seminole counties currently listed in the local multiple listing service (MLS) for $256,939 or less.
 
The first-time homebuyer affordability in Orlando is currently 140.55 percent. First-time buyers who earn the reported median income of $35,608 can qualify to purchase one of 6,517 homes in Orange and Seminole counties currently listed in the local multiple listing service (MLS) for $155,306 or less.
 
Homes of all types spent an average of 104 days on the market before being sold in May 2009, and the average home sold for 94.19 percent of its listing price. In May 2008 those numbers were 115 and 93.83 percent, respectively.
 
An equal number (149) of single-family homes sold in three price categories in May 2009: $120,000 - $140,000, $140,000 - $160,000, and $200,000 - $250,000, which is the price range where most sales traditionally fall. On the far ends of the scale, seven homes were sold for $1 million or more while 97 homes sold for less than $50,000.
 
Inventory
 
There are currently 19,123 homes available for purchase through the MLS. Inventory decreased by 1,071 homes from April 2009, which means that 1,071 more homes left the market than entered the market. Compared to last year, the May 2009 inventory level is 23.55 percent lower than it was in May 2008 (25,015).
 
The inventory level reflects a 10.31-month supply at the current pace of sales, which is down a bit from the 10.89-month supply recorded in April 2009 down significantly from the 18.57-month supply recorded in May of last year. Altogether, inventory months-of-supply has declined 52.14 percent since January 2009.
 
There are 13,734 single-family homes currently listed in the MLS, a number that is 4,931 (26.42 percent) less than this time last year. As usual, most (1,647) are listed in the $200,000 - $250,000 price range. Condos currently make up 3,674 offerings in the MLS, while duplexes/town homes/villas make up the remaining 1,715. Most condos (632) are priced below $50,000; the majority of duplexes/town homes/villas (261) are listed in the $120,000 - $140,000 price category.
 
Condos and Town Homes/Duplexes/Villas
 
The sales of condos in the Orlando area increased by 159.86 percent in May when compared to May of last year, following year-to-year increases of 252.22 percent and 189.74 percent in March and April. A total of 369 condos changed hands in May of this year compared to 142 in May 2008. One thousand three hundred seventy-eight condos have sold to date this year, a 148.29 percent increase over last year's 555.
 
The most (198) condos in a single price category that changed hands were in the $1 - $50,000 price range, more than four times the number (46) that were sold in the next most populated category ($50,000 - $60,000). Only three condos sold for more than $350,000 in May.
 
Orlando homebuyers purchased 156 duplexes, town homes, and villas in May 2009, which is a 35.65 percent increase from May 2008 when 115 of these alternative housing types were purchased. The majority (29) of duplexes, town homes, and villas sold in April 2009 fell into the $100,000 - $120,000 price category.
 
MSA Numbers
 
Sales of existing homes within the Orlando MSA (Lake, Orange, Osceola, and Seminole counties) in May were up by 44.40 percent when compared to May of last year. Throughout the entire MSA, 2,400 homes were sold in May 2009 compared with 1,662 in May 2008. To date, MSA sales are up by 51.71 percent over this time last year, with sales at 10,005 compared to 2008's 6,595.
 
Each county's year-to-date sales comparisons are as follows:
 
Lake County: 20.25 percent above 2008 (1,443 homes sold to date in 2009 compared to 1,200 in 2008);

Orange County: 66.38 percent above 2008 (5,281 homes sold to date in 2009 compared to 3,174 in 2008);

Osceola County: 108.98 percent above 2008 (1,908 homes sold to date in 2009 compared to 913 in 2008); and

Seminole County: 4.97 percent above 2008 (1,373 sold to date in 2009 compared to 1,308 in 2008). 

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