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Orlando Real Estate Inventory Levelling Off

Published: 14 July 2008 - Author: Marcus Burke

Our recent blog “Where is your Personal Bottom?” looked at how fence-sitters risk losing out on the “waiting-for-precise-bottom” game due to the way the housing market is always three months ahead of where it appears to be at any given time. Let’s use some real numbers using data just released from the Orlando Regional Realtor Association (ORRA) to see if this theory pans out.

Realtors sold 1,443 homes in June, a 7.1 percent improvement from the 1,347 home sales in the month prior. In fact, inventory declined for the fourth consecutive month (but is still 5.3 percent below the 1,524 homes sold in June 2007). In total, 6,905 homes have been sold so far this year, nearly 28 percent less than the 9,588 sales posted in the same period last year. There are a grand total of 24,575 homes available through the Multiple Listing Service, a decrease of 440 homes from the previous month. The month-to-month inventory declined 46.2 percent since January.

These numbers suggest that things are still worse than at this time last year, but there are some signs of improvement. Note: these numbers represent are closed sales.

Now here’s a potentially more interesting number – and one which tests the theory: there are also 3,329 homes in the MLS with pending sales contracts – which Realtors consider an indicator of future sales – up from 3,225 in May. What makes this interesting is that if these homes close in the next three months and that data takes another month or so to hit the streets, today, you could be as much as 4 months behind the true sales curve.

The suggestion here is that by the time you hear prices have reached bottom you’re actually way late to the party.

Here are some other fun Orlando real estate facts to consider:

  • The median sales price of a home in the Orlando area in June rose to $217,500, a 2.9 percent increase over May’s $211,400, but 13.9 percent below the June 2007′s $252,500.
  • There are 18,298 single-family homes listed in the MLS, while condos total 4,254, and duplexes/town homes/villas make up the remaining 2,023.
  • Homes of all types spent an average of 123 days on the market before being sold in June 2008. The average home sold for 93.38 percent of its listing price.
  • There is a 17-month supply at the current sales pace.

Food for thought.

My personal guess is that those who haven’t made a purchase (depending on your exact geographical location) by the end of this year or during the first quarter of next year (Orlando) risk missing missing out on “bottom”.

Trackbacks & Pings

  1. Where is your personal bottom? | The Orlando Condo Blog on 15 Jul 2008 at 12:24 pm

    [...] known after the low watermark has been reached and the leveling off process has already begun. (See this post for a real numbers [...]

  2. Orlando Real Estate Inventory Levelling Off on 31 Jul 2008 at 11:35 pm

    [...] wouldn’t know it by watching the local news (or national news, for that matter), but according to a recent post by our good friend Marcus Burke over at Condo Metropolis, Orlando real estate inventory is finally [...]

  3. Fence Sitting Brits May Soon Lose Out | The Orlando Condo Blog on 15 Aug 2008 at 10:54 am

    [...] storm” won’t last forever and as we’ve discussed before, those that wait around for “bottom” invariably miss it and show up late to the [...]

Comments

  1. Bill Strum wrote:

    Well, maybe that’s a little too general.

    Perhaps the risk of getting left behind depends on the segment you are interested in. It also depends on some other factors the numbers don’t fully reveal.

    For instance, I would expect the condo market to continue to sink for some time.

    1.There is a lot of new supply coming on the market.

    2. Rents cover barely 1/2 of cash outflows.

    3. Existing units holders are not able to sell becuase of ‘lockup’ agreements. When these agreements expire, many more units may come on the market.

    As far as average price of residences sold, that’s the average price of units actually sold. Since homes are not perfectly interchangable like say, gallons of gas, one can’t draw too many conclusions from averaging the sales price of unlike properties. In addition, the high end has held up better, thereby skewing the averages higher for homes actually getting sold.

    Then their is the number of foreclosures embedded in the homes sales cited. I would ask what would home sales be without foreclosures?

    I suggest an clear eyed evaluation of the cost of renting vs. the cost of ownership will lead the potential buyer to the real estate promised land. When its a better deal to buy (right now, its still not), then the risk of gettig ‘left behind’ will reappear.

  2. Craigg wrote:

    Marcus, you might want to check your math on that picture with the blackboard. 3 x 3 = 6? I don’t think so.

  3. Marcus Burke wrote:

    Well spotted Craigg! Wish I could take responsibility for it but my math isn’t quite that bad.

  4. P.L wrote:

    *dun dun dunnnnnnnnnnn*
    (plays the mortal combat music)

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