Home sellers in Orlando whose properties are suited as entry-level homes appear to have a heads-up on the market these days. A recent study by the online home search site Zillow showed that the Orlando area tops all other U.S. markets for first-time homebuyers.
Zillow based its study on these five factors: median home prices, forecasted home values, inventory of available homes, costs of renting versus buying and share of homes with price cuts.
In March, the median home price in Orlando was estimated at $202,900, the Zillow study noted. It listed market inventory at over 10,000, with 17 percent of these listings already having a price reduction. Value appreciation over the year for Orlando homes for sale is forecast at 3.8 percent.
Thin Inventory Favors Sellers
The Orlando Regional Realtor Association, in a separate report, also indicated current market conditions remain favorable to sellers mainly due to the thin inventory of available residential properties in its market territory.
The association said that in April, months of supply in the area’s home market was 2.83 months, just a marginal improvement from the 2.46 months’ supply recorded in March and compares with over 3 months a year earlier. At these levels, the market is currently more than three months below the range that is considered normal or balanced, favoring neither buyer nor seller in pricing.
For April, home sales in Orlando totaled 3,061 single-family homes and condominiums/ townhomes. This represents a 12 percent month-to-month drop and a 3.5 percent decline from April last year.
Orlando registered median home prices at $215,000 in April, up 12 percent from a year earlier. The April midpoint price, however, edged downward by 1 percent from March which registered a record-setting pace during the peak home-buying season.
Dealing with the Millennial Market
There are certain caveats though in the market for entry-level homes which sellers of such residential properties need to address. One is that almost half of all the current home buyers are first-time buyers, consisting mostly of millennials in the 18–34 age group.
In order to successfully sell your home to this demographic, its wants and needs have to be considered along with their purchasing power as well. This means that folks selling entry-level residences, among other things, must stage their homes to the taste and preferences of a younger set of residential property buyers.
You should also be prepared to offer some concessions in terms of financing the purchase. Under current market conditions, prospective home buyers are constrained by more stringent lending rules that were formulated following the lessons lenders learned from the last housing crisis.
More often than not, first-time homebuyers are now having problems meeting the requirements for down payments on a home purchase. This is a significant factor that could hold back buyers of entry-level homes in Orlando and in all of Florida for that matter.
What to Do as State Support Dwindles
It was reported recently that Florida’s state legislature is planning to spend only a portion of its affordable housing fund on down-payment assistance to qualified residents. This would be the tenth year in a row that the state’s affordable housing fund won’t be used entirely for its intended purpose and part of it diverted to other state-financed programs.
Worse still, the state legislators are said to be seeking a smaller share of affordable housing in its funds. The Senate, which previously sought affordable-home funding in full, is requesting only over half from the affordable housing fund of $300 million with the rest diverted to state operations and programs.
Be that as it may, there are certainly potent home selling opportunities in the market today, especially if you have an entry-level residence up for sale. WolfWantsHouses is a real estate solutions company which can help you in availing of these opportunities.
We can facilitate a home sale without you having to worry if a potential buyer would be able to raise a down payment or secure financing. WolfWantsHouses buys homes in Orlando and other Florida markets. Call us at 866-886-5345 or fill up our form to get your home sale going smoothly.
About Arturo Cuevas:
Arturo Cuevas covers real estate news in Florida as a Contributing Writer at Sarasota Bay Real Estate and The Motley Fool.