In the last couple of years, the real estate industry shifted from a buyer’s market to a seller’s market. It caught many buyers by surprise as they entered the market to buy a home in Orlando and found multiple offer situations at every turn, and in many cases homes selling for above asking price. On the other hand, it has been music to sellers’ ears that the median sales price has increased 26% since last year! Is a more balanced market on the way in the New Year?
Markets always shift and there are always ups and downs. The reason for the latest shift is due to lack of inventory. The number of homes for sale in Orlando declined while the number of buyers held strong (the law of supply and demand at work). There are many home-buyers still desperately trying to buy before the interest rates and/or the home values price them out of the market.
As we look forward into the New Year, many wonder will this market continue at this pace. While I cannot look into a crystal ball and determine the future, there are some trends that suggest things might be shifting a little. The October numbers have been released and my best guess is that things will just level off a little bit in 2014. And here’s why:
– The total inventory has increased for 7 consecutive months. Since the prices have gone up, more homeowners have equity and are planning to sell in the New Year.
– The number of closed sales has declined for 3 consecutive months (this could just be seasonal but see below)
– The number of homes “under contract” or future closed sales has declined for 8 consecutive months.
If the inventory continues to increase, that provides more competition and things will likely shift to a more balanced market. I know for buyers this is what they are hoping for in the New Year! For sellers, things should still remain positive in 2014. As long as interest rates remain attractive, the buyers will be there buying. I do imagine there will still be multiple offers in some price ranges where there are still TONS of buyers searching; but overall if the inventory increases things may appear a bit more balanced.
Are you planning to sell a home in Orlando in the New Year? If so, check out this post about selling now. What do you think the real estate industry will look like in 2014?
Image credit: Balance Beam by Ian B M via Creative Commons