Central Florida has been challenging the “supply and demand” principle of economics.
Recent reports show the state of Florida has the highest number of empty homes and the most homes for sale in the U.S. market, which has led to a year-to-year decrease in sales and median prices. However, Central Florida’s numbers are perplexing.
In the Orlando region, the latest numbers show their highest inventory of homes since 2011, but home median prices are actually on the rise. While sales are about 12% down from what they were last year, month-to-month sales have seen an almost 4% increase.
A housing market "gold mine"
Lawrence Bellido is a Realtor with 26 years in the Central Florida area and now president of the Orlando Regional Realtor Association. He said this shows a balanced market, where homeowners are looking to sell – hence the high inventory – but buyers have a number of options as well.
This is why, he said, even though there are so many homes listed for sale and people are taking their time to buy, home prices are not likely to come down any time soon. The area is still a solid and desirable spot for investors in the market — a “gold mine,” he called it.
“I agree 100% that we should see some type of price drop, and there are going to be some adjustments to pricing. But surprisingly enough, the homes that I've sold are coming in at a higher appraised value,” he said. “So, they're maintaining their value.”
According to Bellido, there are bound to be corrections in the market. After the COVID-era craze of buying in Florida, things have cooled off, and the market is mellowing out. Top peak or bottom low prices, and other market extremes observed during the pandemic are not stabilizing, accounting for what Bellido called a trend leaning more toward a “buyer’s market.”
Affordability might be an issue
But in Central Florida, affordability might continue to be an issue for some buyers. While markets in other areas of the state might see steeper drops, Bellido said, that only means many of those people who are leaving from mainly coastal areas are looking to move closer to the center of the state — away from expensive coastal maintenance, repair costs, and insurance premiums, and closer to the more stable, more family-friendly environment of inland, Orlando homes.
Which means the Central Florida market, unlike others across the state, is still on the hot side.
“I never thought I'd ever see the day where $400,000 was a rich price point. But right now, we're sitting at $380 to $390 [thousand] for a medium price range. So it wouldn't surprise me, in the next couple of months, we're going to be in a $400,000 range. And then even higher,” he said.
A healthy inventory is considered in the market to be a six-month supply of homes. Right now, the Orlando region sits at five and half months’ worth of listed homes. Bellido said that maybe once inventory in the region comes closer to or above the six-month point, we might see some buyers drop their prices. Until then, the market remains a confusing and overwhelming place to navigate.
Find resources to help you
For first-time homebuyers and other target demographics, Bellido said he suggests they look into local, state, and federal grant programs that could help them get significant discounts on their home investments. However, he said that the best way to address the market is by consulting an experienced realtor who knows the area and can best advise each individual, depending on their needs and resources.
“Don’t try to go on Zillow and do it yourself,” Bellido said. “Anywhere I go in the world, personally, as President of the Orlando Regional Realtor Association, I will still meet another realtor, find the best one, and have them do a consultation with me and show me how to buy a home over there and let them represent me — absolutely. Without a doubt, that is non-negotiable. I don't want to get ripped off.”
Some markets to look out for in the outskirts of the Central Florida tri-county area that are on a down slope include, West New Haven in East Polk County and the Deltona-Daytona Beach-Ormond Beach market in Volusia.
Lillian Hernández Caraballo is a Report for America corps member.
