Lately a lot of people have been asking me “How is the market in Orlando?”. I think the news of rising prices and overall positive real estate news in the national media has people wondering – are things better now?
Let’s take a look at the market now compared with the lowest point of the market crash. Bear with me here, this isn’t super exciting sexy stuff, but it’s important to know where we have been to know where we are going in the real estate market!
The real estate boom is said to have taken place in 2005 and as you can see from the chart below the rising prices continued into 2006 and 2007. The effects of the “hot” market drove the market behavior over the next few years. When the market shifts, it takes a little time before things catch up with it. From 2006-2008…within two years, the median sales prices in the Orlando real estate market had been cut in half! By 2009 the market in Orlando had officially crashed and the absolute low was finally felt when the median sales price hit $94,900 in January of 2011.
What is important to note is the number of new listings that came on the market had a direct correlation to how the market performed. I know, I know – supply and demand at work – it’s so simple and yet so many people missed the signs! As word of the real estate market boom in Orlando spread, the prices rose in 2005-2006. That led even more sellers to jump into the market to sell their homes for extraordinary prices! By the end of 2006, there were almost 30,000 new listings on the market compared to the previous year! That’s a lot of inventory. So of course, with all of that new competition and no new demand the market tanked! Over the next couple of years, the days on the market increased as all of these listings sat.
So what’s been driving up our prices in the last few years? Well it is supply and demand of course! If you take another look at the number of new listings in 2011 – 2012 you’ll notice that the number of homes for sale in Orlando and number of new listings hit a low. That in turn caused a shortage in our market and drove the median price back up to where we are today. New listings are on the rise, but we are still at a healthy level for now.
As you can see we are nowhere near the median home values that topped the market in 2006-2007, and the rising inventory will keep us in a nice happy balanced market for now. Until it gets too high and can’t support the number of home-buyers in our area. Where will we be in another year? Check out my other post to see the top things to watch in 2015.
Do you need to make a move? Love where you live and get started with your home search today.