On the Rebound: Orlando Home Sales

Don’t tell builder Keith Bass about the lagging residential Florida real estate market.

Despite a Florida Association of Realtors January report showing a 35 percent drop in existing single-family home sales, Ryland Homes’ Orlando division president says the company posted an immense improvement in sales and traffic in February. Bass says he expects February to end with sales 60 percent up over January.

“Last week was the best week we’ve seen in sales all year, and we’re seeing sales continue to climb and traffic is climbing,” Bass says.

Despite higher median home prices and lower sales volume reported in January, Bass joins local Realtors in believing the market appears to be on the upswing.

Ryland’s Orlando division posted a 60 percent to 70 percent increase in sales for the week ending Feb. 26 when compared with the previous week. Prior to that, week-over-week sales were up about 35 percent, Bass says.

Ken Bennett, regional vice president of Watson Realty Corp., says his Florida home mortgage brokerage recorded 45 new sales — those expected to close within 45 days — in Central Florida on Feb. 26. That was Watson Realty’s highest daily volume since 2005.

“Our message to Central Florida is: ‘Don’t listen to the national gloom and doomers,’ ” Bennett says. “We are in a very healthy market.”

Orlando Regional Realtor Association President Randy Martin says January appeared to be an anomaly. January closings in the Orlando housing market totaled about 1,350, while a typical month would see 2,200 to 2,500 closings, he says. February should be back up to about 2,000, he says.

But while home builders may be seeing a temporary spike in sales and interest, buying a home in Central Florida could become much more difficult in the future, says David Marks, president of Marketplace Advisors Inc. in Maitland. According to a report by his firm, “A 20/20 View of the Orlando Region’s Future,” avoiding huge increases in median home prices and the cost of living is going to be a major challenge in the long term.

“Land is not getting any more plentiful,” Marks says. “As we get more people (in the region), we have more people sharing a limited resource, so things will go up in cost. … Now, we have a real issue of affordability.”

The report, which looked at a 60-mile radius around Orlando and compared it with similar metropolitan markets, noted that while median home values in Orlando were cheaper than both Atlanta and Dallas in 2000, in six years the Orlando market passed Atlanta by 12 percent and Dallas by 56 percent.

And while median household income is expected to rise in the next 15 years, the cost of living will go up even faster than that, Marks says.

For January 2007, the FAR report showed a 2 percent increase in existing single-family home median sales prices, to nearly $260,000 from $254,100 in the same month in 2006. The fourth quarter of 2006 showed a median sales price of $264,000, compared with $254,800 for the same period in 2005.

Watson Realty’s Bennett says Florida home prices were expected to go up, but the return is an improved quality of life.

“This used to be a very, very affordable place to live and it still is, but just not as much as it was 10-15 years ago,” Bennett says. “But when you compare our lifestyle with other parts of country … there’s a price to pay for that.”