As the aftershocks of the coronavirus pandemic permeate into nearly every part of life in Orlando and beyond, there is one thing that, surprisingly, has so far continued on just about the same as before: buying and selling homes.
Even during government mandates to stay inside, houses are being put on the market, tours are being conducted virtually and homes are being sold. In the midst of one of the most unprecedented and uncertain times, folks are still making one of the biggest purchases of their lifetime.
“We’re not in a housing crisis,” Orlando Regional Realtors Association President Reese Stewart said. “We’re in a global pandemic.”
“All indicators are, once this passes,” he said, “we’re going to be in a strong real estate market.”
The pandemic has inevitably slowed sales, though. In April, there were 2,393 home sales in Central Florida, according to the latest figures from ORRA, 28% fewer than the 3,329 sales last April and 25% fewer than the 3,204 sales last month. It was an expected drop, coinciding with Gov. Ron DeSantis’ stay-at-home order that went into effect April 1.
Across price points, sales declined. For homes between $100,000 and $119,000, there were 61 sales compared to 103 last April; for those between $200,000 and $249,000, there were 537 compared to 852. Even at high price points, from $500,000 to $599,000 for example, there were only 64 sales, compared with 104 last April.
Despite the lower demand as some residents pause their home searches until the pandemic passes, the data also showed that median home prices have continued to rise, increasing 12% from $253,500 last month to $263,750.
How the market will fare during May is still unclear, but the National Association of Realtors anticipates it to be a low for closings. In later months, the association expects to see an upturn.
“Our market — like those nationwide — is grappling with the coronavirus-induced slowdown,” Stewart said. “Orlando Realtors anticipate listings and buying activity will eventually resume, especially given our history of demand versus low supply, along with the record-low mortgage rates that increase buyers’ purchasing power.”
Roger Frase and his partner Ronald Hinkle just moved from Columbus, Ohio, to the Waterford Lakes area. Done with Ohio winters and also a Disney enthusiast, Frase had been looking at homes in the Orlando area for nearly two years.
The house was listed for $399,000, and Frase and Hinkle got it for $392,000. Frase perused homes remotely over video chat with his real estate agent, and he explored neighborhoods on Google Maps.
“For me, the pandemic had no effect,” Frase said.
Real estate agents adjust
Many agents have quickly adjusted to showing properties over Facetime and getting titles and closing documents signed without meeting in person.
Alexandre Mestdagh, president of Apollo Title Company in Winter Park, said he set things up so clients could sign papers from their cars. Apollo Title, he said, actually saw an uptick in businesses, including a 70% increase in refinances and a 50% increase in closings.
Still, a survey from the National Association of Realtors of 3,121 of its members found that some would-be homebuyers are putting off purchases. About 40% of respondents said their clients are delaying buying for the next few months, another 18% have stopped looking out of fear of losing their job or because they already have and 6% have put off buying indefinitely.
Sellers, the survey said, have acted about the same.
Barbara Bonaparte and her husband are moving in early June. Both retired, they were looking to downsize. They purchased a new home still under construction in the Lady Lake area of Lake County last year and moved to sell their house of 33 years just as more cases of COVID-19 began to crop up in Central Florida.
Watching the death toll rise and the early effects of efforts to curtail the virus’ spread, Bonaparte got nervous the house would sit too long or offers would be too low. The last thing the Bonapartes wanted was to juggle two houses at once.
“Everyone said, ‘Don’t worry about it, the housing market isn’t going to crash.’ But I don’t know, It didn’t want to take any chances,” Bonaparte said. “You think back to what happened in 2008 and I didn’t know what was going to happen. I knew people were going to become unemployed as things were shutting down. If you have a stay-at-home order, who’s going to be looking to move if you don’t have to?”
So they decided to list the house, located in the Wekiva area, about two weeks before they had originally planned. The next day, an offer came in at asking price, $310,000.
“It turned out that the housing market didn’t go down, and houses are still moving. I’m happy that I miscalculated, honestly,” Bonaparte said.
Israel Herrera, a real estate agent from the Figueroa Team with eXp Realty, said although his and his team’s business has kept pace with pre-pandemic levels, there were several clients who were nervous. Agents were showing homes wearing masks over their faces, gloves on their hands and medical booties over their shoes.
“A lot of people were comparing it to what happened in the crash, but this is completely different than that,” Herrera said.
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Other agents and economists have said the same thing, that this isn’t a repeat of 2008. Back then, almost anyone could get approved for a mortgage and for houses they couldn’t actually afford. That irresponsible lending has mostly been corrected since then and much stricter rules have been put in place.
But Central Florida’s so far resilient housing market isn’t the result of a region that’s been spared by the pandemic’s economic fallout. Zillow’s chief economist Jeff Tucker and many others have said they anticipate the Orlando area’s workforce to be one of the hardest hit because of its dependency on tourism and the low-wage workers who prop up the theme parks, hotels and restaurants out-of-towners love to visit.
Many of those workers aren’t homeowners, they’re renters, many of whom live paycheck-to-paycheck and only dream of one day buying a house. They’re struggling to pay rent, not mortgage payments.
A survey by data analytics provider RealPage and the National Multifamily Housing Council found just 78.6% of renters living in the Orlando metro area paid their rent in April, followed by 84.4% in May.
“The profile of people who have bought homes is much older, wealthier and more financially secure with really strong credit scores than the pool of people who had bought home in the early 2000s,” Tucker said. “That’s why we’re not seeing such a strong impact on the people in the purchase market for housing.”
News Source: Orlando Sentinel.