Have you seen videos warning you about buying a home in the current market or within the Orlando real estate market with claims that the market crash has begun, or will soon happen?
I understand that’s a scary and disappointing thing to see.
In this blog, I’m going to discuss with you the status of the real estate market in Orlando, Florida, starting with the bad, the good, and what you can do going forward.
So if you’re thinking about buying or selling a home in Orlando, and you are concerned about the real estate market here, this is for you.
The Bad News
People are calling the current situation with the housing market a standstill due to the following reasons:
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Home affordability and interest rates are high. On one side, there are sellers who could sell their homes if they wanted to, but they like their current interest rate. On the other side, there are buyers who are priced out of the market because of the higher interest rate.
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Rate of inflation is high. Although inflation has slowed down significantly since the government started their rate hikes, the rate of inflation is still not where they want it to be. So there is a good chance that the Federal Reserve will keep raising interest rates.
The Good News
Now, I want to point out some things for you to put into consideration if buying now is possible for you and you’re concerned about this market.
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These high interest rates are in fact the standard for a 30-year fixed mortgage if you compare them to interest rates throughout history1. So when considering the bigger picture of history and interest rates, the interest rates are not bad.
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Despite these high interest rates, the Orlando market demand is still going strong. According to this REALTOR.com® price chart2, the sale price of single family homes in Orlando since January of 2020 is an overall upward trend in prices.
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While the media is calling the overall housing market in the US a standstill, that is not what’s happening in Orlando. The reality here is that there are still people in the market and many who want to be in the market. The word I would use to describe this market is slow down and not standstill.
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The slower market means that buyers and sellers do not have to move as quickly as they had to during the buying frenzy of a couple of years ago. We are experiencing a slower market so buyers and sellers have some more breathing room during the process of buying or selling.
What About Foreclosures?
If you’ve been seeing news stories about foreclosures going up, I also want to show you that the number of foreclosures each month in Orlando is still extremely low. In June 2023, there were only two closed sales that were foreclosures. And overall foreclosures have been staying very low in Orlando for the past few years. We’re not seeing numbers anywhere near what we saw during and after the 2007-2008 housing crisis.
Key Takeaway
While this market is not ideal for many buyers, there are healthy things happening in the Orlando market. Regardless of what’s happening in the market, my recommendation to buyers is that it’s not risky to purchase a home right now if you plan to hold onto the home for at least 5-10 years. And if you’re thinking about selling a home in Orlando, there is still strong demand in the market, and your home will sell if it’s priced correctly.
All in all, it’s essential to take in all factors of the market along with your individual financial situation. I hope this information helps you if you’re thinking about buying or selling in the Orlando area.
Sources:
- St. Louis Fed
- St. Louis Fed
