Orlando Florida Real Estate Blog

First time homebuyer affordability index soars in response to decline in median sales price

(December 10, 2008 – Orlando, FL) First time homebuyers have the best conditions since March 2004 to purchase a home in the Orlando area, as a decrease in the median sales price of homes sold in November pushed the first time homebuyer affordability index up to 96.09 percent. In addition, inventory of houses on the market is stocked with more than 6,030 homes in the average first time buyer’s price range of $136,422 or less.

November’s median sales price of $167,025 is a decline of 28.90 percent when compared November 2007’s median price of $234,900 and a decline of 4.91 percent when compared to October 2008’s $175,650.

The decrease in median price also drove the area’s affordability index to the year’s record high of 135.13 percent. (An affordability index of 99 percent means that buyers earning the state-reported median income are 1 percent short of the income necessary to purchase a median-priced home. Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.) Buyers who earn the reported median income of $51,962 can qualify to purchase one of 11,510 homes in Orange and Seminole counties currently listed in the local multiple listing service (MLS) for $225,699 or less.

Members of the Orlando Regional Realtor® Association were involved in the sale of 4.57 percent more homes in November of this year than last: 1,076 to 1,029. The number of pending sales, considered by housing economists to be a reliable predicator of future sales activity, continued its five-month upward trend to 3,326. There are 84.2 percent more homes under contract in November 2008 than compared to November 2007 (1,806).

The area’s average interest rate was 6.00 percent in November 2008, down from 6.30 in October and level with 6.00 percent in September.

Homes of all types spent an average of 109 days on the market before being sold in November 2008, and the average home sold for 92.93 percent of its listing price (a decrease from October 2008’s 93.09 percent). In November 2007 those numbers were 114 and 93.77 percent, respectively.

The majority of single-family homes (136) that changed hands in November 2008 were sold in the $200,000 - $250,000 price range; 99 homes sold in the $140,000 - $160,000 category and 94 homes sold in the $250,000 - $300,000 category. Five hundred fourteen homes sold for less than $200,000 in November, and 132 sold for more than $300,000. On the far ends of the scale, 16 homes were sold for $1 million or more while 35 homes sold for less than $50,000 (yet again the most this year).

Inventory

There are currently 24,408 homes available for purchase through the MLS. Inventory decreased by 249 homes from October, which means that 249 more homes left the market than entered the market. Compared to last year, the November 2008 inventory level is 6.74 percent lower than it was in November 2007 (26,172).

The inventory level reflects a 22.68-month supply at the current pace of sales, which is up from the 20.08-month supply recorded in October. Year to date, inventory months-of-supply has declined 28.32 percent since January 2008.

There are 17,859 single-family homes currently listed in the MLS, a number that is 1,768 (9.01 percent) less than this time last year. As usual, most (2,782) are listed in the $200,000 - $250,000 price range. Condos currently make up 4,450 offerings in the MLS, while duplexes/town homes/villas make up the remaining 2,099. Most condos (503) are priced at $120,000 - $140,000. The majority of duplexes/town homes/villas (301) are listed in the $140,000 - $160,000 price category.

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About the author:

Jerry LaRose is an Orlando Area Residential Real Estate Expert, who can assist you with the purchase and/or sale of real estate in Orlando, Windermere, Winter Garden Florida or any place in the country. Jerry has created a team of professionals throughout Orlando and the country to ensure that you enjoy a smooth transition to your new area. Please visit www.JerrySellsOrlando.com for your real estate needs. Please give me a call if you have questions about the Orlando and Central Florida real estate market.

Jerry LaRose, P.A., ABR, GRI, e-PRO, CLHMS, REALTOR® 407-580-7011

(Copyright © 2008 By Jerry LaRose, P.A. All Rights Reserved.)