Home prices and sales in Orlando ticked down in August, but falling interest rates and sellers coming to terms with lower prices are leading to optimism in the market.
The median home price was $404,220 in metro Orlando for the month, a drop of 1.2% year-over-year, according to Homes.com research. The region includes the counties of Orange, Osceola, Seminole and Lake.
The drop was a reversal of the 1.2% gain Orlando had made in July.
In August, the number of home sales also dipped, to 3,161. That's 6% lower than July and 9% below the previous year, according to Homes.com. Inventory rose 18.5% year-over-year, and homes spent an average of 73 days on market, unchanged from July.
Despite, or perhaps because of, the sagging performance, Dominick Florio, a broker with ReMax Town & Country Realty in Winter Springs, said the market is becoming more attractive to buyers.
“Inventory is still high, which is giving buyers more options,” Florio told Homes.com. “We’re seeing a few more homes than usual, and it’s taking a little longer to get them under contract. But the buyers have a free hand in today’s market.”
Average mortgage rates fell slightly from the previous month, from 6.46% to 6.35%, according to a report from the Orlando Regional Realtor Association.
'Good stuff coming'
On Sept. 17, the Federal Reserve announced a reduction in the overnight interest rate by 25 basis points, which is helping move mortgage rates lower. The average 30-year fixed mortgage rate fell to 6.26% by Thursday, according to mortgage giant Freddie Mac.
Florio said the activity felt as though the news was already having an impact. “A lot of people have been watching it,” he said. “The phone was ringing all day today, so I think we’re going to see good stuff coming.”
Sellers, Florio said, have also started to realize that the post-pandemic market is no longer a game of listing houses for any price.
“Sellers don’t have the option anymore of just throwing a number out there and seeing if it sticks,” he said. “You’ve got to make adjustments to what your game plan is, and it’s probably going to change three or four times before that place gets sold.”
Single-family homes were the only segment of the market to see a price increase, with the median price up 0.7% to $439,000, according to Homes.com data. The median condo price was down $15,000 year-over-year to $200,000.
“New and enhanced safety regulations across Florida are partly to blame for the weakness in the condo segment,” said Lisa McNatt, Homes.com director of analytics for Orlando. “Homeowners association and assessment fees are rising as older buildings age and maintenance needs increase. Orlando is somewhat less exposed given it's not a coastal market, but it is not immune to national disasters. That risk is being priced into both individual and master policies, driving up costs for condo owners.”