I had the pleasure of appearing on FOX 35’s Good Day Orlando program earlier this week to discuss the recent RE/MAX Housing report that showed Orlando ranking 3rd in the nation for the largest increase in homes sold.
Preparing to discuss the report I pulled together some of the latest market information reflecting on 2023 and peering into the future and what is going to happen in 2024. With a population surge, affordability challenges, and shifting inventory dynamics, the Orlando market continues to be a captivating arena for buyers and sellers.
The Pulse of 2023 – A Rollercoaster Ride Population Surge and Affordability Challenge: 2023 witnessed the lowest number of home sales across the nation since 1993, emphasizing the critical role affordability plays in shaping market dynamics. Fueled by the pandemic Florida’s population soared by 1.9%, in 2022 reaching 22,244,823 making it the fastest-growing state in the nation.
Pent-up Demand Unleashed: So why the surge? Buyers and sellers alike experienced a release of pent-up demand, driven by factors such as job changes, household formation, marriages, and births. The anticipation for interest rates to drop further added to the momentum in the real estate market.
Inventory Fluctuations: Inventory saw a slow but steady increase over the past eight months. While November 2021 had less than a month’s supply, the current 4-month supply marks a shift towards a more balanced market that many consider to be between 5 and 6 months. Closed sales, down 17% from October, align with the normal seasonal trends and actually mirrored the same level as 2022 despite higher interest rates.
The Interest Rate Conundrum Affordability Challenges and Interest Rates: Affordability emerges as a significant challenge, accentuated by October rates reaching their highest in over 22 years at 7.8%. However, the market is already witnessing a shift, with mortgages dropping to the low 6’s and even the 5’s for some loan programs. This shift signifies a potential game-changer for the Orlando market.
Price Dynamics: While prices experienced a slight dip from October to November, the median home price surged by just over 4% in the last 12 months. The advice echoes – don’t wait. Anticipate rate cuts, act when you find the right house, and capitalize on potential refinancing opportunities as rates decrease.
The Road Ahead – Time to Buy Advice for Buyers: The resounding advice is to act now. Expect rate cuts to bring an influx of buyers, intensifying competition. The mantra becomes clear – “Marry the house and Date the Rate.” Secure the right property and be ready to capitalize on favorable refinancing when rates decrease.
As we step into 2024, the forecast is for a busy year with increasing activity as the months unfold. In the realm of real estate, there’s never a bad time to own a home, but remember, every market is unique and working with experienced professionals who understand the local market, like those at RE/MAX Heritage becomes paramount for success in navigating the ever-evolving Orlando real estate landscape.
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