Orlando Real Estate in 2008 – Looking back while looking forward!January 3, 2009
New Year and New Beginnings:
It has been an interesting year in Orlando with sales suffering as a result of the mortgage meltdown and economic recession.
In Orange County, year to date, there have been 8,586 sold homes compared to 9,306 in 2007, which represents about a 7% decrease in sales. While this figure is not too shocking, it is the price point where things change dramatically.
In December, sales under $300,000 accounted for 84% of all homes sold in Orange County (for the record, the statistics are similar in Seminole County as well). Total sales of single family residences in Orange County for the month of December were 595 units. Only 9 homes over $1M were sold in December with eight (8) of these homes having been built post 2001 and four since 2007. Only one older home sold over $1M and it was built in 1991.
There are currently 9,392 homes active and for sale in Orange County and a significant number of these homes are foreclosure/short sale opportunities. None of the above figures include condominiums for sale or sold in today’s marketplace.
What does this mean to us? Clearly, homes in the FHA funding price range (under $300K) are selling at a quicker pace. FHA is considering reducing their loan limits to $274,850 (previously $353,750) starting January 1st so you may see a decrease in sold prices in the near future.
FHA loans are popular because they allow the seller to contribute to the buyer’s closing costs and they allow for creditor’s who have less than stellar credit scores to borrow money backed by the federal government.
On the plus side, interest rates are at lows rarely seen since the 1960’s for borrowers with great credit scores. The Orlando buyer of today has a multitude of options and many properties to choose from.
So where do we go from here? We stay the course, keep current on market trends and realize that homes have to be darn near perfect to sell. There is a new term called “frugal chic” and buyers of today are demanding high-end finishes (like granite countertops) in homes under $300,000. I am also seeing buyers who can afford homes in the $500K price point but buying homes priced much lower. It’s an interesting phenomenon.
If you have any questions, please do not hesitate to call me. Thank you for the opportunity to be of service.