The Orlando area’s 2-year-old climb up from the depths of the nationwide housing slump has been accelerating lately, with the median home price in the core market rising 22 percent in the past year alone, a new report shows.
The midpoint price for a house in the core market, mainly Orange and Seminole counties, was $140,000 in March — up 5.2 percent from a month earlier and 21.7 percent from a year earlier, according to the report released Monday by the Orlando Regional Realtor Association.
That’s the largest year-over-year increase in the Realtor group’s monthly median price since February 2006, close to the height of the home-buying frenzy.
Winter Park real estate agent David Welch said the market is so heated right now that one of his prospective buyers offered cash on three houses — for more than the asking price each time — yet in each case was beaten by other buyers.
“Every sale I have had for the last nine months was in a multiple-offer situation,” Welch said. “You almost have to look at it by asking: How much over the asking price do I have to offer?”
The Orlando area’s median price hit bottom in January 2011 at $94,900. But it has risen almost 50 percent since then, including an increase of almost 30 percent just in the 15 months since January 2012.
Among the market pressures driving up prices: a dwindling inventory of listings and an influx of hedge funds purchasing distress properties.
One of the most dramatic turns in the local market has been that continuing decline in inventory: Last month the core market had a 2.6 month supply of homes based on the current pace of sales — its smallest supply since 2005, which was the Orlando Realtors’ single-busiest year on record for existing-home sales.
Orlando real estate broker Kari Gann, who by her own reckoning has purchased, fixed up and sold more than 100 properties in the past 20 years, said Monday that hedge funds have now made it impossible to find suitable houses because they are buying up so many of them.
And just as Orlando prices spiraled downward from 2007 through 2010 because of a flood of foreclosures and short-sale properties selling for below-market prices, housing prices now are experiencing hyperinflation because foreclosure sales are dwindling and more “regular houses” are selling for the going, market rates.
“Normal sales traditionally carry a higher price tag than foreclosures and short sales,” said Steve Merchant, chairman of the Orlando Realtors group and a broker at Global Realty International. “For example, in March the median price for normal sales is $173,590, while the median for foreclosures is $96,000 and for short sales is $110,000.”
Of the 2,605 sale completed by the local association’s members in March, half were houses that were not in distress. The number of normal sales has increased 50 percent from a year ago, while the number of short sales and foreclosures have dwindled.
The average interest rate paid by Orlando-area homebuyers in March was 3.65 percent, the first month-to-month increase since April 2012. Houses that sold in March were listed on the market for an average of 80 days, which is about two weeks less than the listing window for houses that sold a year ago.
In addition, March sales prices were only 4.1 percent below the asking prices, on average, which is slightly less negotiating room than buyers had a year ago.