Orlando Real Estate

Orlando Real Estate First Half of 2010

July 1st, 2010 8:30 AM by David W. Welch

In the first half of 2010 sales of homes in Orlando are up 42.6% compared with 2009. That actually may not be the most impressive statistic, believe it or not. In the first half of 2009 there were 10,266 closed sales with 4,292 bank owned and 1,144 short sales closed. (A number of MLS rules and features changed last year allowing us to more accurately measure short sales.) So far in 2010, and I expect these numbers will go up by a few hundred still as June 30th closings are not all accounted for, there have been 14,645 closed sales with 6,398 REO and 3,447 short sales included in that number. So, while overall sales are up about 43%, REO sales are up more than 49% and short sales are up 200%. Undoubtedly, the short sale measures from last year are low. Even if they were off by 100%, short sales could be up 50%.

Sales prices last year hovered around the $125,000 mark, while this year prices have been around $115,000. So, while we saw an 8% drop in prices we have seen a 43% increase in sales. Some would conclude the tax credit helped to push our sales, but I believe it is investors who have been driving this current market. Cash transactions last year at this time accounted for just over 40% of the closed sales with 4,159. That is pretty remarkable, and I calculated earlier this year that last year alone there were about $1.1 billion in cash sales. In the first half of 2010 the number of cash sales has skyrocketed 76.3% to 7,332 or 50% of the total number of sales. At this rate, we can expect over $1.4 billion in cash transactions to close in the Orlando real estate market this year. If you take the overall increase in sales of 4,379 and subtract out the 3,173 extra cash sales there were an additional 1,206 that may be attributed to the tax credit. Of course, some percentage of these were second homes or otherwise did not qualify for the credit.

In my opinion, the tax credit is probably responsible for fewer than 1,000 additional sales. In reality, it probably just caused some sales to come quicker than they would have without the credit. This is one reason I expect the second half of the year to be a bit slower than the first. I also believe I am seeing a return to a more typical real estate cycle which tends to have slower sales in the Fall. If the economy can get a good foot hold and job creation gets on track, I am looking for 2011 to be much stronger still.

David Welch Real Estate Optimist, Orlando Real Estate

Posted in:General
Posted by David W. Welch on July 1st, 2010 8:30 AM


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