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Click on the links below to access the most recent editions of the Orlando Market Pulse (Adobe Acrobat required):
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May Update
Each month, the Orlando Regional Realtor Association publishes its Market Pulse, a report containing essential market data. Here is our breakdown of the May edition (you can read the full report by clicking here):
First, the bad news:
1.) Once again, overall inventory remained virtually unchanged. Prices will continue to decline as long as there are over 25,000 homes on the market and only 1,100 or so sell each month.
2.) We touched on this in the previous point, but the number of sales closed last month was 1,147. That’s an increase of only 27 from March and a far cry from the almost 1,600 homes that sold last April.
3.) The number of expired and withdrawn listings decreased from March to April. This goes to overall inventory. As long as sellers continue to keep their homes on the market at unrealistic prices or in poor condition, the inventory will remain high and buyers will take advantage of the oversupply.
Now, the good news:
1.) The average mortgage rate decreased from 5.94% in March to 5.77% last month. Lower interest rates increase the purchasing power of buyers, which translates into an expanded buyer pool.
2.) The number of new contracts written last month increased to 2,012. That’s the highest amount since May of last year and is a strong indicator that buyers are re-entering the market.
3.) The average number of days a property was on the market last month dropped to 121 from 128 in March. Days on market is a good indicator of how well properties are priced. Therefore, a decline in the number indicates more reasonable pricing by sellers.
We were actually a little bit surprised by this month’s report. There was a strong feeling among Realtors that overall inventory would decline by at least a thousand and total sales would increase by at least a few hundred. Since that didn’t happen, we’re still sliding down the hill, waiting to hit bottom.
Our advice to sellers and buyers remains much the same this month as it did last month.
Sellers remain in the unenviable position of having to decide whether to sell now or wait at least three or four years. Prices are still declining, so it’s vital to make that decision as quickly as possible. If you’re planning on selling to buy something larger, now is absolutely the best time to make that move. If you are in a position where you have to move, take a careful look at your overall financial picture to see if leasing the property makes more sense than selling.
Buyers are still in the driver’s seat as far as the market is concerned. However, lenders are continuing to tighten the reins, making it more and more difficult to obtain a loan. We strongly recommend buying in the near future over waiting. Even though we haven’t bottomed yet, the specter of higher interest rates and stricter lending guidelines make waiting a true gamble.
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*If you are interested in market trends for your specific zip code, please contact us and we will be happy to provide you with the data.
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