2013 Orlando Housing Market Report – Its Good News!

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In 2013, Orlando’s housing market continued to show signs of strong home buyer demand, with Orlando home prices climbing once again.

Orlando’s annual median home price ($149,625) finished out the year 23.66 percent higher than the 2012 annual median price ($121,000), thanks to significant median price improvements every single month in 2013. In fact, Orlando’s median price (all sales types combined) has now posted positive year-to-year gains for 29 consecutive months, and has risen 68.76 percent since January 2011.

In addition to median price gains, sales for 2013 finished 6.54 percent greater than in 2012. The closings of “normal” homes skyrocketed 41.90 percent in 2013, while short sales dropped 33 percent and foreclosures dropped 11.56 percent.

“Homeowners who were waiting for seller-favoring conditions to put their “normal” homes on the market found what they were looking for in 2013,” says Orlando Regional REALTOR® Association Chairman Zola Szerencses, RE/MAX 200 Realty. “Buyers spent the year competing fiercely for available properties, and the resulting bidding wars helped reverse underwater mortgage conditions for many owners.”

“Orlando REALTORS® anticipate the coming year to be less stressful for buyers as our painfully thin inventory continues to fill out and the market as a whole moves toward a healthy balance,” continues Szerencses. “We expect more traditional sales to continue contributing to inventory increases as sellers seek to capitalize on the still-strong buyer demand, and a fresh influx of foreclosures to provide additional opportunities for buyers in 2014.”

It’s definitely the right time to enter the market, call us to find out what your home is really worth 407-412-8488.

Renters Beware – Case Highlights Craigslist Housing Scams

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Peppered among the countless Orlando home-rental ads on Craigslist are a few warnings:

• Stay away from a man subletting a $600 bedroom and bath at a Casselberry community.

• A certain Orlando woman with an extensive arrest history is renting out homes that are in foreclosure.

• Don’t give money to Melissa Diller for deposits on rentals in Seminole County — she doesn’t actually own the homes.

Seminole County detectives said that warning, placed on Craigslist in December, tipped off would-be renters — and eventually law enforcement — that Diller was trying to rent out a Longwood home that she had no rights to.

Deputies arrested Diller and her suspected cohort, Kenyon Times, before the would-be renters lost their $1,100 deposit, but other consumers aren’t so lucky.

Sheriff’s Office spokeswoman Kim Cannaday said Diller is suspected of committing the same fraud several other times in Seminole County — cases that are being investigated by Longwood police.

There are many ads on Craigslist placed by people who can legally rent homes. But how can the public decipher between the legitimate and illegitimate listings?

Cannaday said people need to do their research.

“Use the property appraiser’s website to ensure you are dealing with the actual property owner or company,” Cannaday stated. “Google the names of the people/company you are dealing with [they should be licensed agents] and the property address.”

As with any deal, Cannaday said, if it “seems to be good to be true, then it probably is.”

Deputies say the home on Howard Avenue in Longwood that Diller tried to rent is managed by a legitimate real-estate company but that Diller stole the house key from the lock box on the front door.

Then, detectives say, Diller and Times put an ad on Craigslist  advertising the home for rent and later gave the prospective renters a tour of the property.

Other rental scams have been reported in Central Florida, including people who illegally rent out homes that are in the foreclosure  process.

In those cases, the fraudster finds vacant homes listed for sale and accesses the property with the key in the lockbox. They change the locks and then advertise the house for rent.

When a prospective tenant visits, the person pretending to be the landlord collects deposits and rent.

One such case was reported in 2012 in the Rose Point community in northwest Orange County.

There, alert neighbors saw a Rooms To Go truck unloading furniture at a vacant, foreclosed home. After some investigation and getting law enforcement involved, the rental scam was uncovered.

Red flags for housing scams, according to Zillow.com:

•Requests to send money via MoneyGram or Western Union. Do not wire money to anyone you haven’t met personally.

•Long-distance landlords. Be cautious of people who claim to be missionaries, in the military or work for the United Nations.

•Requests for personal or financial information. Do not give your Social Security number or banking account numbers to people who you have not thoroughly vetted.

• Listings and emails full of typos and “sob stories.” People who include stories about their family problems or financial issues are usually a sign of fraud. These messages also include lots of typos.

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2014 – What does the future hold?

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The U.S. real estate market made a robust comeback in 2013, as the combination of low inventories and historically low interest rates caused home prices to rise and even helped fuel bidding wars in some markets. While positive trends, such as increasing home values, are expected to continue into 2014, mortgage rates are also expected to rise in the coming year and could put a damper on home buyers’ abilities to afford new homes.

1. Inventory Should Gradually Stabilize and Return to Traditional Seasonal Levels

The beginning of 2013 could be characterized as the “year of low inventory” as buyer demand ramped up and homeowners waited for further price increases and evidence of a solid economic recovery before putting their homes on the market. The year began with a significant shortage of inventory (reported by realtor.com®), and then as early as February the level of shortages started to decline slowly. As 2013 closed, inventory were approximately the same as a year ago. However, homes are selling faster than in 2012, with the median age of the inventory down by 11 percent.

2. More Homeowners Are Likely to Return to Positive Equity

Rising prices helped 2.5 million homeowners who were previously underwater regain positive equity status during the second quarter of 2013. However, approximately 7.1 million homes were still in  negative equity at that time and an estimated 10 million homeowners, or about 21.1 percent of all homeowners with a mortgage, remained “under-equitied,” with less than 20 percent in home equity. The good news is that prices are expected to continue rising in 2014, which will lift more homeowners into positive  territory. According to realtor.com®, median list prices for homes in October rose 7.57 percent above the same month of 2012.

3. Mortgage Rates Are Expected to Rise

Mortgage rates increased approximately 100 basis points in 2013 and are likely to rise in 2014. The new chairman-designate of the Federal Reserve, Janet Yellen, is expected to continue the policies of Chairman Ben Bernanke, including keeping mortgage rates low by buying blocks of mortgage-backed securities. However, the Fed has considered tapering its bond-buying activity as the economy improves, which could lead to a slight increase in interest rates.

4. Foreclosure Activity Is Expected to Slow

Foreclosure sales are likely to play a minimal role in the housing market in 2014. September 2013 was the 36th consecutive month with a year-over-year decrease in foreclosure activity. Foreclosure inventory has dropped to multi-year lows, down nearly 33 percent since the end of 2012. Foreclosure starts were down 39 percent in the third quarter of 2013 to the lowest level since the second quarter of 2006.

5. Further Declines in Home Affordability Are Expected

The National Association of REALTORS®’ Home Affordability Index, which compares home prices with income, dropped to a five-year low in 2013 as price increases outpaced income growth. If the U.S. economy begins to grow at a faster pace and incomes begin to rise, though, the affordability index will slide further from rising mortgage rates.

While no one can predict with certainty what the housing market holds in store for 2014, a constant in real estate is always that local markets vary widely in their performance. National numbers can tell a story about the economy in general, but home prices, inventory and foreclosure activity depend on local market conditions. Contact Jenny and The Wemert Group at 407-412-8488 for the most up-to-date  information about your market.

Happy New Year!

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As 2013 comes to an end and we welcome in a new year full of hope and expectation, we wish you and your family a 2014 overflowing with health and happiness, with the very best wishes from The Wemert Group.

A look back at 2013 – What really happened….

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As 2013 comes to a close, a look back over the last 12 months reveals several trends.

1. Housing Prices Rose Faster Than Expected
The national median house price was $179,900 in January 2012.  Price appreciation accelerated quickly over the year to reach a median sale price of $199,500 by September 2013.
2. Mortgage Rates Rose but Remained Low
Mortgage rates were expected to rise in 2013, and they started to increase in the late spring.  However, it is expected that mortgage rates are likely to stay low and perhaps even drop between now and March 2014.
3. Bidding Wars Returned
The combination of rising prices, low mortgage rates and low inventory led to a sense of urgency among buyers and the return of bidding wars.   At the end of September 2013, 2,210,000 homes were for sale, approximately a five-month supply
4. Housing Affordability Remained High
Housing affordability did come down a little this year because of double-digit home value appreciation and the fact that income didn’t rise in comparable amounts.  Rising mortgage rates, even though they’re still low, have also had an impact. While affordability right now is at a five-year low, it’s still the fifth highest for the past 30 years
 5. All-Cash Buyers Continued to Be a Strong Market Segment
About one-third of all home purchases were made with cash, a market share that has been consistent for the past three years. While some of these cash buyers are from overseas and some are institutional investors, others are “mom and pop” investors who have had trouble getting financing.
6. Mobile Apps Accelerated Connections Between Buyers, Sellers and Realtors
Nearly every Realtor and brokerage in the country introduced a mobile app this year to make it easier for buyers and sellers to access information from their smartphones and tablets.  A recent study by Google and the National Association of REALTORS® found that 68 percent of homebuyers used a mobile app during their home search and 89 percent used a mobile search engine at the onset of the home-buying process and throughout their research.  Download the Keller Williams Realty Real Estate Search App and contact us for our Agent Code today.
7. Rising Rents and Pent-Up Demand Pulled More First-Time Buyers Into the Market
At the peak in 2002, nearly 70 percent of people owned homes and 30 percent were renters.  Now 65 percent of people are homeowners and 35 percent rent. Not only are rents rising faster than home prices in many markets, but there’s pent-up demand from people who don’t want to live at home with their parents and who want to buy a home.

It has been a better 12 months than many expected, and the prospects for 2014 look good, so if you’re thinking of buying or selling, call us today and let us help you get ahead of the game!