Orlando Weekly Real Estate Market Update 09.07.07

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The Real Estate Market Synopsis

Slight Improvements in Orlando Unsold Inventory of Resale Homes and Average Home Prices

Gitta Urbainczyk, P.A., E-Pro, RECS, CLHMS, Broker Associate

While the negative real estate news on the national scene seems to indicate that the sky is falling, we are so lucky to be in the Orlando area where great economic news is keeping the real estate market alive and kicking. We are blessed with low unemployment, a diversified workforce, great weather and a lot of future life-science industries that are pouring into this area. The good news seems to be playing out on the real estate numbers, where we see a slight decline of the unsold home inventory in the greater Orlando area from 31,500 unsold homes to 31,150. This is great news and so are most other numbers, For the past 30 days (08/05/07-09/05/07) versus the same period in 2006, the Orlando area enjoyed a 4% increase in the average sold price of homes from $289,837 to $300,322 and average days on the market changed from 120 days in 2006 to 140 days in 2007.
The individual city breakdowns are as follows:

Orlando:
In 2006, the average home price was $272,489.  In 2007 it is $284,503, which represents a 4% increase over 2006. The average day on the market increased from 85 days in 2006 to 131 days in 2007. The negative trend is the sales volume which declined by 49%. This is clearly a problem will spawn more problems in the long run in terms of foreclosures.

Lake Mary:
The Lake Mary area is showing a great improvement in the average home price of 15% over the same period of last year.  The average home price is up from $415,265 in 2006 to $477,878 in 2007. Sales declined only 8% and the average days on the market went from 96 days to 116 days, which is below the overall area.
 

Longwood:
Home prices skyrocketed during the last 30 days by 32% over 2006 from $402,806 to $531,698 in 2007. This is certainly a great performance.  Sales were only 4% behind last year and the average days on the market doubled from 86 days in 2006 to 168 in 2007.
 

Oviedo:
The Oviedo market is challenged like so many other markets, but still sellers are holding on to their sales prices.  Those prices actually increased 2% over the same period last year. This is great for the buyers of real estate to see that home prices in central Florida are keeping up the pace.  It’s also good news to see that there is very little risk of buying a home and expecting the bottom to fall out in the future. Days on the market increased from 91 days in 2006 to 143 in 2007. Yes it does take longer to sell a home but at least, unlike other areas around the state, this city is holding its own.

Clermont:
Lake County is very challenged with a huge amount of unsold inventory and lots of undeveloped land and very strong new home inventory. Therefore, this area is going to be challenged for a long time to come. For the past 30 days, Clermont prices dropped just 2%.  However, the number of sold homes declined by 32%, from 112 homes to 67 homes this year.  Days on the market increased from 127 last year to 158 days this year. The home with the longest days on the market in 2006 was 519 days. This year, the longest on the market is 596 days. The length of time represents the huge oversupply of new and resale homes in Clermont and Lake County.

Winter Park:
If there is any city in Florida which should hold value, it is Winter Park. It is amazing to me that this part of the Orlando area is getting hurt with a reduction of 18% in price over last year and 10% lower sales!  As well, days on the market have jumped from 98 days in 2006 to 140 days in 2007. We all understand about the days on the market but the decrease in price of 18% is certainly a strong concern.

Debary:
Unsold single-family home real estate in Volusia County is at an all time high.  Home sales are way behind last year’s performance and continue to be very challenging for some time to come. Comparing the same period to last year, sales have dropped by 34%.  The average home price has also declined from $242,408 to $220,160.  Average days on the market have increased from 110 days to 181 days. West Volusia County home prices are going to hold their value.  The prices are still a better value compared to Seminole County.  West Volusia is a relatively short commute and an alternative area to live in for the more price-conscious buyer.

Kissimmee:
The major challenge for the Kissimmee area is the huge oversupply of vacation homes which were primarily bought by speculators and investors and are now seeking buyers. This area of metro Orlando is favored by British buyers and a preponderance of homes are owned by British people.  These remain a great investment opportunity as long as the dollar remains weak against the pound. Kissimmee had a 2% reduction in home price and a 63% decline in sales.  Average days increased in sold inventory form 115 day to 192 days. Kissimmee will remain a challenge, but hopefully the British investors regain confidence in the Orlando real estate market.

Windermere:
The Windermere market is very challenging.  However, for investors, this market remains to be strong in terms of average sold price. The average home price increased from $932,531 in 2006 to $953,531 in 2007. Sales decreased by 33% and average days on the market grew from 99 days to 177 days. Windermere remains far ahead of any other central Florida real estate market in terms of the average home price. Much of this is fueled by the Butler Chain of lakes and such areas as Isleworth, Bellaria, Reserve at Butler Sound, Keene’s Pointe, Summer Port, Lakes of Windermere, Balmoral and many more exquisite subdivisions.

Apopka:
The Apopka area is suffering from a huge oversupply of resale homes and new home developments, and consequently the average sold price dropped by 4% in August compared to last year during the same time. Average home price dropped from $254,753 to $241,081 and sold homes decreased by 50%. Selling time increased from 93 days in 2006 to 133 days in 2007.  Some of the more popular subdivisions are Rock Springs Ridge, Pines Of Wekiva, Wekiva Crest, and Errol Estate.

Sanford:
This area showed an 11% increase in the average price of homes sold, which is caused mainly by some of the upscale subdivisions, such as Lake Sylvan Cove, Wilson Park, Buckingham Estates, Lake Markham Preserve, Preserve At Astor Farms, Lake Forest, and Berington Club, selling some high priced homes. The average price in 2006 was $277,441, increasing in 2007 to $309,169. Sales in general decreased by 41% and the average day on the market went from 82 days to 125 days. Like in all areas, sellers are trading price for days on the market.  However, in the long run, this will cause problems and sellers will be forced to reduce prices to sell.

The real estate market is going to continue to be very, very tough.   Sales are not going to improve until we shake out a lot of the sub-prime problems and prices drop to a more affordable level in the entry level homes. Until this happens, sales will be very slow as in the past and market time is going to be very challenging for everyone. Today, the first shoe of many has dropped, with unemployment numbers coming in much lower and the stock market taking another 250 point hit. I do hope some of the darker predictions are not going to come to pass.  I hope to see a bottoming out of the slide soon.

Have a great weekend.

Gitta

Discussion Forum

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