Hurricane Irma's Impact on the Orlando Housing Market
The ripple effect after a natural disaster often has surprising impacts. You expect insurance claims, repairs to homes and infrastructure, and even the way communities rally to support those affected.
In the aftermath of Hurricane Irma, you saw all of this, but you may not have considered the effect it would have on Orlando's housing market.
Closings in September 2017 were down considerably compared to August – by over 1,000 properties. The main culprits were an inability to bind insurance and power outage delays, but there were also simply fewer homes on the market, with many homeowners delaying their listings or taking homes off the market to complete Irma-related inspections and repairs. Even with all of these factors, median home prices continued their upward trend, clocking in at $225,000 for September 2017, a 9.8 percent increase over September 2016, when the median home price was $205,000.
Orlando Home Prices
Though there was no change in median home prices between August and September of 2017, Orlando has enjoyed year-over-year increases for 74 consecutive months. While the overall median home price is $225,000, the median price for a single-family home is $245,000, an 8.9 percent increase over September 2016. The median price of condos is now $118,000, a whopping 26.9 percent increase over the previous year. The average listing in September was $276,276, with homes selling for 96.9 percent of their list price.
Orlando Home Sales
September 2017 saw 2,526 closings, a 29.4 percent decrease from the previous month (3,544 closings) and an 18.8 percent reduction from September 2017. Sales of single-family homes dropped 20.8 percent year-over-year and condo sales dropped 12.0 percent. Around 95 percent of sales were standard transactions, with short sales making up only 1 percent of transactions. The other 4 percent went to bank-owned properties.
All sales were down compared to September 2016. Short sales fell an incredible 71.8 percent and bank-owned sales dropped 57.1 percent. Standard transactions fell by only 13.9 percent. However, although sales of existing home dropped 19.3 percent compared to September 2016, sales for the year as a whole are up 2.3 percent.
Orlando Home Inventory
The inventory of single-family homes is down 14.3 percent compared to September 2016, with condo inventory dropping by 27.9 percent. The inventory of bank-owned properties has dropped every month for 30 months in a row now, down 40.5 percent year-over-year, with short sell inventory reduced by 68.3 percent. These reductions have taken Central Florida's inventory of short sell and foreclosure homes to pre-recession levels.
The average home sold in September spent 574 days on the market, which is an increase of three days over August but a decrease of three days compared to September 2016 and 10 days compared to 2015.
If the current sales pace continues, the Orlando area has a 3.42 month supply of homes. Typically, a six-month supply is considered balanced, favoring neither the seller nor the buyer. Anything below six months is said to be seller's market and above six months is a buyer's market.