Despite facing challenges like rising interest rates, limited inventory, and affordability concerns over the past year, real estate analysts are optimistic about the housing market outlook for the Orlando area in 2024.
With 27 years of experience as a realtor in Central Florida, Rose Kemp expresses unparalleled enthusiasm about what lies ahead.
“As the City Beautiful, known affectionately as O-Town, we're now witnessing a boomtown,” she remarked. “Orlando's growth is truly remarkable. Construction is booming, expanding into areas like Sanford, Winter Garden, Clermont, St. Cloud, and even beyond Kissimmee into territories I never thought could be developed. It's nothing short of extraordinary.”
Despite the emergence of new developments to accommodate the growing population, home sales in the Orlando region dipped by 20% in 2023 compared to the previous year.
Kemp, who now serves as the president of the Orlando Regional Realtor Association, attributes this decline to higher interest rates, causing many potential buyers and sellers to adopt a wait-and-see approach.
While mortgage rates have shown a recent decline, they remain significantly higher than the lows seen during the pandemic. For instance, purchasing a $400,000 home with a 10% down payment at a 7% rate over 30 years would yield a monthly payment of around $2,700, excluding taxes and insurance. In contrast, the same loan at the 2.5% rate seen three years ago would result in a monthly payment of roughly $1,700.
Despite the challenges posed by higher rates, Kemp views them as a positive for the market. Inventory in the Orlando area has increased to a four-month supply, the highest level since 2019. Typically, the real estate market is considered balanced when there is a six-month supply.
“What we're witnessing now is a robust market,” Kemp noted. “With a median price of $389,000, although it's been challenging, it's primarily due to the low inventory.”
Anticipating a potential rate cut by the Federal Reserve in the upcoming months, Kemp suggests that inventory levels could tighten once again. She advises those considering a purchase to act promptly to avoid missing out on favorable conditions.
“This is the opportune moment to enter the market because once spring and summer arrive, it's going to be a frenzy,” Kemp advised.
