Florida has been in the running for worst property market performance since the financial crisis crippled the U.S. economy, but Orlando is now showing signs of life as more potential buyers in the area help drive up prices. The Orlando Regional Realtor Association has reported a 21.2% increase in prices since January and a 15.1% increase over the last 12 months. Analysts say increased affordability and interest from international buyers is spurring the market, but sellers are still overpricing their homes considering many buyers are still underwater in their current homes or are having a hard time finding financing due to tighter lending restrictions. For more on this continue reading the following article from Property Wire.
Residential property prices in Orlando, Florida, a favourite location for overseas buyers, are bucking the national trend in the United States and have increased 15.1% in the last 12 months.
Florida, along with California and Arizona, has been one of the worst hit property markets during the downturn but there are signs that buyers are back.
Figures from the Orlando Regional Realtor Association also indicate that the increase in prices has been strong in the first half of this year. They have increased 21.2% since January.
Foreclosures and short sales are making up a shrinking share of local home sales and Orlando metro area’s median price for August was $115,000.
‘A steady rise in the percentage of normal sales, those that are neither bank owned nor short sales, continues to boost the overall price,’ said the report.
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Those normal transactions made up 41% of sales in August, down 1% from July. That was the first decline in such sales after they rose for six consecutive months.
Even with prices on the upswing, though, sellers continue to overprice their homes, the report shows. The average home sold for 95% of its listing price in August, after spending an average of 101 days on the market before coming under contract.
Affordability numbers suggest the Orlando market still has a large amount of untapped demand. The area’s affordability index rose to 248 in August, showing median income earners make more than twice as much as they need to in order to qualify for a median priced home.
‘Affordability conditions this year have been enormously favorable, but many buyers are being held back because banks are offering financing to only the most highly qualified borrowers and ignoring a large share of otherwise creditworthy buyers,’ said association chairman Mike
‘Those potential buyers represent the difference between an uneven recovery and a much more robust housing market that in Orlando and even on a national scale could stimulate additional economic activity and create jobs,’ he added.
Sales are also increasing Southern California, up 8.6% from July, but the outlook going forward is murky with August sales far below historic averages, according to figures from DataQuick.
The month of August was an improvement from July with 19,654 homes and condos selling in the counties of Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That compares to 18,090 sales in July and 18,541 sales from a year ago. August was the first month since the middle of 2010 to report a year on year gain in Southern California home sales.
But the outlook is not brilliant, according to John Walsh, president of DataQuick. ‘Scratch beneath the surface and there’s not a lot to cheer about this month. Home sales were up from a year earlier but remained far below average. Many would be buyers can’t find financing, and others who want to make a move now are stuck because they owe more than their homes are worth,’ he explained.
‘Financial markets are increasingly choppy, the political outlook is incredibly murky and consumer confidence remains poor. Needless to say, it’s not an environment ripe for stabilizing the housing market,’ he added.
This article was republished with permission from Property Wire.