A decade after the summer of ’07, when Orlando real estate began a years-long crash, median home prices have not returned to their high but continued to rise incrementally, a new report shows.
Midpoint prices for houses that sold during June in the core Orlando market were $222,500 — about $30,000 less than when the housing market overheated 10 years ago, according to new data from Orlando Regional Realtor Association. Prices were up 8 percent from a year earlier.
Ten-X Research last week named Orlando the nation’s second hottest market for the summer, citing its bumpy path. Nashville took the number one spot.
“As a poster child for the housing bust, Orlando deviates from the other top markets, but its ranking reflects the continued opportunity for growth amid the protracted recovery seen across many Florida metros,” researchers stated in a report released last week. “While historical volatility is a consideration at this point in the cycle, the metro’s impressive performance is grounded in solid underlying fundamentals.”
Zillow reported this week that 10 percent of Metro Orlando homeowners are still financially underwater — unable to sell their homes for enough money to cover their outstanding mortgage.
The housing scene for an area of mostly Orange and Seminole counties contrasts starkly with the earlier 2007 era when mortgages were relatively easy to obtain. In addition to price differences, a major distinction is buyer choices. Last month, the Orlando area had a 2.8-month supply of homes on the market. On the precipice of the 2007 housing collapse, the supply was more than 17 months.
Also, the monthly sales for June were more than double the sales from 10 years earlier, according to the Orlando Regional Realtor Association. Last month, members of the association sold 3,837 houses, which was up from a year ago and edged up from a month ago. On the eve of the housing bust, sales reached 1,524 in June 2007.
Another difference between then and now: The average sale price in June was 97.5 percent of the asking price. A decade ago, buyers drove a harder bargain, with sales prices that were 94.9 percent of homes’ price tag.
The market’s years-long recovery chugged along in June with the help of a slight drop in interest rates to 3.98 percent from 4.09 percent a month earlier.
“Those able to close on a home last month are probably feeling both happy and relieved,” he stated. “Listings in the affordable price range are scarce, homes are coming off the market at an extremely fast pace, and the prevalence of multiple offers in some cases are pushing prices higher.”
Unlike Orlando’s slowing housing scene from a decade ago, sales in almost every corner of Central Florida increased in June from a year earlier. Within the four-county region of Orange, Seminole, Osceola and Lake counties, sales increased the most in Osceola with a 15 percent year-over-year rise. Only Seminole experienced a decline, dropping 6 percent from June 2016.
In summer 2007, year-over-year sales for the Orlando area were down 46 percent.