Homebuyer Tax Credit Creates 'Ripple Effect' on Orlando's May 2010 Housing Stats

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(ORLANDO, FL) -- According to the Orlando Regional Realtors Association (ORRA), the Central Florida housing market saw across-the-board increases in sales, new contracts, and pending sales together reflect the broad impact that the homebuyer tax credit and affordability conditions. In addition, the area's month-over-month median sales price has increased for the fifth consecutive month.

Members of ORRA reported completed sales on 2,605 homes in May, which is a 38.42 percent increase over the May 2009 mark of 1,882.

The number of new contracts filed in May 2010 (3,669) represents an increase of 6.19 percent more than were filed in May 2009 (3,455). The area's pending sales statistic -- also an indicator of future sales activity - is likewise remaining at a record high with 56.76 percent more homes (10,351) under contract and awaiting closing in May of this year than in May of last year (6,603).

And finally, the median price of all existing homes combined sold in May 2010 increased 0.33 percent to $115,380 from the $115,000 recorded in April 2010. May 2010's median price is, however, a decrease of 11.25 percent compared to May 2009's median of $130,000.

"The upswing in May housing sales was expected because of the tax credit," explains ORRA Chairman of the Board Kathleen Gallagher McIver, RE/MAX Town & Country Realty. "No doubt there will be some fallback in new contracts in the months to come due to its expiration, but other factors are also affecting the market."

"Nationwide, the homebuyer tax credit brought close to 1 million additional buyers into the market," says Gallagher. In Orlando, those new buyers have helped  stimulate the trade-up market and have significantly improved Orlando's inventory," says Gallagher

May's $115,380 median price encompasses all types of sales situations and home types. The median price for "normal" sales is $160,000. The median price for bank-owned sales is $81,800 (up 12.52 percent from last month's $72,700), and the median price for short sales is $110,000 (down 4.35 percent from last month's $115,000).

Of the 2,605 sales in May, 921 "normal" sales accounted for 35.36 percent of all sales, while 1,091 bank-owned and 593 short sales made up 64.64 percent.

The Orlando affordability index increased to 225.86 percent in May. (An affordability index of 99 percent means that buyers earning the state-reported median income are 1 percent short of the income necessary to purchase a median-priced home. Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.) Buyers who earn the reported median income of $53,048 can qualify to purchase one of 11,767 homes in Orange and Seminole counties currently listed in the local multiple listing service for $260,594 or less.

First-time homebuyer affordability in May increased to 160.61 percent. First-time buyers who earn the reported median income of $36,073 can qualify to purchase one of 7,762 homes in Orange and Seminole counties currently listed in the local multiple listing service for $157,515 or less.

Homes of all types spent an average of 85 days on the market before coming under contract in May 2010, and the average home sold for 94.58 percent of its listing price. In May 2009 those numbers were 103 and 94.26 percent, respectively. The area's average interest rate decreased in May to 4.89 percent.

Inventory

There are currently 15,963 homes available for purchase through the MLS. Inventory increased by 197 homes from April 2010, which means that 197 more homes entered the market than left the market. The May 2010 inventory level is 16.52 percent lower than it was in May 2009 (19,123). The current pace of sales translates into 6.13 months of supply; May 2009 recorded 10.16 months of supply.

There are 11,992 single-family homes currently listed in the MLS, a number that is 1,742 (12.68 percent) less than in May of last year. Condos currently make up 2,635 offerings in the MLS, while duplexes/town homes/villas make up the remaining 1,336.

Condos and Town Homes/Duplexes/Villas

The sales of condos in the Orlando area increased by 56.61 percent in May when compared to May of 2009 and decreased by 1.00 percent compared to April of this year. To date, condo sales are up 92.50 percent (2,670 condos sold to date in 2010, compared to 1,387 by this time in 2009).

The most (325) condos in a single price category that changed hands in May were yet again in the $1 - $50,000 price range, which accounted for 54.90 percent of all condo sales.

Orlando homebuyers purchased 230 duplexes, town homes, and villas in May 2010, which is a 40.24 percent increase from May 2009 when 164 of these alternative housing types were purchased. Forty-seven duplexes, town homes, and villas sold in May 2010 fell into the $100,000 - $120,000 price categories.

MSA Numbers

Sales of existing homes within the entire Orlando MSA (Lake, Orange, Osceola, and Seminole counties) in May were up by 26.61 percent when compared to May of 2009. Throughout the MSA, 3,145 homes were sold in May 2010 compared with 2,484 in May 2009.

To date, sales throughout the MSA are 41.26 percent above this time in 2009 with 14,252 homes exchanging hands compared to 10,089. Each individual county's year-to-date sales comparisons are as follows:

Lake: 30.18 percent above 2009 (1,898 homes sold to date in 2010 compared to 1,458 in 2009);

Orange: 44.14 percent above 2009 (7,713 homes sold to date in 2010 compared to 5,351 in 2009);

Osceola: 26.26 percent above 2009 (2,428 homes sold to date in 2010 compared to 1,923 in 2009); and

Seminole: 63.08 percent above 2009 (2,213 sold to date in 2010 compared to 1,357 in 2009).

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