Downtown Orlando Condo Market

Condominiums are changing Orlando's skyline with 30 announced or started, survival of these projects is the question with the lack of buyers and rising construction costs many construction projects have been halted or many have rethought about going forward with the projects. Two years ago developers would have no problems attracting buyers for contracts, but with rising mortgage rates and softened market have made viable projects take a different direction. Condos in the city center is been attractive to buyers across the nation, but without buyers many will not qualify for construction loans. Courtesy of Orlando Sentinel 8/20/06.

Orlando Real Estate Update

July Statistics from Orlando Regional Realtor Association.

• Orlando Unemployment Rate 3.1%
• Average Mortgage Rate 6.53%
• Inventory of Homes 19,827
• New Listings 6,862
• Pending Sales 2,505
• Homes Back on the Market 364
• Expired Listings 1,066
• Homes Withdrawn off the Market 2,353
• Homes Sold 2,113
• Average Time on the Market 61 days
  

Nationwide Real Estate Sales Status

According to National Association of Realtor home sales are down 7% for secondo quarter compared to second quarter 2005. 28 states have declines sales with the leading states that experienced the real estate boom last year.

• State Sales decline: Arizona (26.9%), Florida(26.7%), California (25.3%), Virigina (23.9%), and Nevada (23.5%).
• States that have seen gains this year are Arkansas (17.9%), Texas (11.3%) , North Carolina (11%), and Vermont (9.1%).
• Cities that have seen gains are Baton Rouge, La (27.3%), Ocala, Fla (25.3%) and Virigina Beach (23.6%).Courtesy of Orlando Sentinel 8/15/06.

What's up with Condo Hotels?

Condo hotels are the hottest thing in the hospitality industry right now, but a market study indicated investor demand may drop and many projects planned will not be built. Condo hotel are newly built or converted hotels. These buildings operate like hotels, but units are sold as condos but are rented out like hotel rooms, owners have the option not to rent it out. These condo hotels are in the hotel business, and will follow the supply and demands of hotel rooms. Orlando condo hotel market is expected to soften which means projects may not be executed. This study showed 103 condo hotels with 76 under construction. 56% of the condo hotels reside in 4 cities Las Vegas, Orlando, Miami, and Fort Lauderdale. Orlando has 47 condo hotel projects underway two located in tourist areas, and two in downtown Orlando. Right now the hotel business is looking good. Courtesy of Orlando Sentinel 8/15/06.

New Construction Homes in Orlando

Orlando housing market still active compared to other areas of the country despite rising interest rates. Orlando strong job growth and low unemployments keeps real estate moving. New home inventory representing a 9 month supply of vacant built homes represents 23,539 units. Courtesy Orlando Sentinel 8/12/06.

Buyers Market on the Horizon

Real estate sales of new and resale homes have slowed, but median prices of homes are still increasing. These gains have been smaller than previous years. As record level of unsold homes sit on the market is causing greater pressure on pricing in coming months. David Lereah, chief economist at National Association of Realtors predicts the sales slowdown has hit rock bottom. Stubborn home owners are starting to realize they need to lower the price to attract buyers. We are helding from a sellers market to a buyers market. It is a great time to buy with plenty of homes to chose from. Courtesy Orlando Sentinel 8/9/06.

Projections in the Real Estate Market

David Berson, chief economist for mortgage giant Fannie Mae gave some projections about the real estate market nationwide.

• Average home price apprecition which had been in double digit are expected to decline to 3 percent or below by the end of the year (other colleagues predict 4 to 6 pecent).
• If speculators continue to dump rentals or second homes pushing inventories and appreciation to drop to 1-1.5 percent not seen since recession in early 1990's.
• The condo market will be vulnerable to price declines and investor dumping.
• There will not be widespread decline of property values part of current down cycle. Only in markets where speculation was rampant in 2003-2005 and where job and population growth are low.
• Mortgage rates will not rise significantly higher than today's rates which are still historically low.
• In flatten markets sellers need to become more creative by offering holding second notes or concessions to push the sale, or buy down the purchasers interest rate to lower monthly payments.
• Buyers should acquire real estate at prices and terms that were unthinkable a few years ago and do go out to do that.
  Courtesy Planet Realtor.
  

Can You Sell Your Home Through a Statue?

More and more people are selling their home through a 200 year old tradition, by burying a St. Joseph statue. When sellers bury the statue in their yard, it brings appeal for sale of their home. St. Joseph was successful at moving to different places quickly between Nazareth to Bethlehem then permanently in Egypt. With real estate market coming off 5 year fast track resulting in slow down in sales, seller are putting their faith in St. Joseph. The tradition works like this. St. Joseph should be buried with the feet facing heaven, and the head of the statue facing the home. It should be placed in the backyard or near the for sale sign. When the house sells, the seller should go to the home near closing date, retrieve the statue and say a prayer of thanks. Consequently, more statue are selling like never before. Courtesy of Planet Realtor.

Florida Property Insurance Rising

Since, Hurricane Andrew, Florida has been in property insurance mess despite legislators attempts to fix it. With home and condo insurance soaring, with customers being dropped or coverage being slashed, many Florida's are wondering if they can afford to stay in Florida. $715 million in tax money has been allocated toward the $1.7 billion deficit at state run Citizens Property Insurance, Florida largest insurance company. Florida homeowners will be on the hook to pick up the rest of almost $1 billion. Legislators have allowed 10% increase in insurance premium without state approval which has cleared the way for drastic price increases for Citizen's customers. During the next 12 months people will see their homeowners-insurance bills more than double. There is a debate about how long will legislators bail out the insurance companies. Many people think the insurance companies need to take a loss, since, this is the business they are in. To read more about "Coverage Costs Soar Out of Reach", please visit Orlando Sentinel.

Florida Real Estate Update

A top housing industry economist warned home builders at a meeting with Southeast Building conference that the building industry will remain weak through 2006 and 2007 and possibly 2008. With rising interest rates and affordability has caused the market to slow. Many Florida has advantages over most states due to the strong job growth and could population of in-migration of residents. These strengths have remained in place for both new construction and resale homes. The property insurance crisis and affordability are negative aspects to deal with. Florida average home price appreciation is about 15% per year in past 5 years, which economist say is unsustainable. Economist also mentioned if oil prices continue to rise and another shock hits US ecomony such as a bird flu attack could tip us into a recession. Courtesy of Orlando Sentinel 8/3/06.

Central Florida Commuter Rail

A commuter rail train is coming to Central Florida to relieve one of the nation's most congested areas. The train from Debary to Downtown Orlando will be completed by 2009. Most funding, construction and designs issues have been worked out. Governor Jeb Bush is expected to announce the nearly $500 million deal today. Funding is coming from all levels Federal (50%), State (25%), and County (25%) contribution. FDOT will oversee design, construction and operation of the rail system. Jeb Bush is expected to annouce the deal with CSX transportation which own 61 miles of track. The state is going to buy the tracks in exchange for improvment with greater capacity for CSX. The rail from Debary to Downtown Orlando already exist, there is future plans to build rails in Volusia and Osceola counties. Nearly 30,000 residents commute from Volusia county to Orlando. This will not only create transportation alternatives for Central Florida residents, but create new possibilites for housing and retail development around transit stations in Volusia, Seminole, Orange, and Osceola counties. New commuter rail cars will be on display today at the downtown Orlando Lynx bus station. Courtesy of Orlando Sentinel 8/2/06.

Insurance Crisis for Condos

Rising insurance rates have been media news since the rash of hurricanes in 2004. Not only are insurers not writing for the state of Florida, but rates are increasing especially for condo owners. Lake Villas condo, in Altamonte Springs Florida, insurer, Nationwide, did not renew its policy. The condo association signed on with Citizens Insurance, the state backed insurance of last resort. Citizens insures when others will not, but coverage is less for the money. Lake Villas insurance bill changed from $33,902 to $197,276 and deductible changing from $500 per building to $26,000 per building. These increases will be passed along to the home owners. This would mean increases of $200 per month to home owners. This insurance covers exterior building of the condos, and interior insurance rates are also going up. Many home owners feel they will have to sell, as once their condo was an affordable option. This is occuring in condos across the state from the coast to central Florida.

When buying a condo, your real estate agent, should obtain information on whether the condo association is considering a "special assessment" or increasing condo fees to owners to adjust for insurance hikes. Courtesy of Orlando Sentinel 8/1/06.

Upscale Bella Collina Apopka Florida

Bella Collina, a development by the Ginn Corporation, located just west of downtown Orlando in the small town of Montverde, is starting to build mammoth homes along Lake Apopka. Lake Apopka has had a massive clean up effort for its polluted waters will be home for several millions dollar homes slated to be built. Bella Collina sold most of the its lots during 2004 to international investors with big pockets with the hope of flipping the property. Although, the Lake County property appraiser indicates the housing market is on a down turn, Patrik Kelly VP of sales for Bella Collina believe during the slow down the amenities will draw people to the area and home building will pick up. The homes being built are around 9,500 sq. ft. priced at $7 million. These homes have raised property values in Montverde in the millions. Builders are building 8 model homes estimating prices from $4 million to $7 million. 1,900 acres have been cleared for a Nick Faldo designed golf course and 800 homes. They are also building two club houses, 50,000 sq. ft. Italian inspired design with 3 resturants, spa and pool. Also a 10,000 sq. ft. sports and esquestrian center which will include a sports field and indoor dressage arena. Bella Collina will be part of the street of dreams October 14, to November 26, 2006. Courtesy of Orlando Sentinel 7/29/06.

Cost Interrupt Road Plans for Innovation Way

Innovation way a technological corridor in Southeast Orlando is the fastest growing region in Orlando. This area will be home also to UCF new medical schools and potential VA hospital. 52,000 residents will be part of this area by 2025. Because of escalating construction cost the Expressway authority has cut back on projects two of them being the interchange at State Road 528 and State Road 417 which is need to accomodate growth. Developers comments this delay will not too bad as the final designs have not been approved. The agency is looking at funding alternatives. Other projects that cannot be started because of lack of funding is an interchange at Moss Park Road and State Road 417, widening of State Road 408 both east and west ends, Maitland Blvd extension to U.S. Highway 441, and interchange State Road 417 at Boggy Creek and Florida Turnpike. Orange county schools are also caught up in high land, labor, and construction cost to build 68 new schools by 2016 to accomodate Orlando's growth. Courtesy Orlando Sentinel 7/27/06.

Consumer Confidence Rising

For second month in a row, consumer confidence index rose to 106.5 in July from 105.4 in June. It is a economic sign of higher incomes and more jobs increase consumer confidence, despite slowing home sales. In Florida home sales fell 29% after pressures of rising mortgage rates, inventory levels and increase insurance premiums. Approximately 18,000 Florida homes have been sold compared to 25,000 one year ago. All 20 Florida metro cities have seen a decrease, and Jacksonville has only seen the lowest at 3% drop. Orlando Real Estate sales are down 21%, but median price of a home up 10% to 266,300 from last year. Courtesy of Orlando Sentinel 7/26/06.

Orlando New Construction Impact Fees Increasing

Impact fees are new construction costs to the city for fire, sewer, water, and road resources as a result of growth. Builders are charged these impact fees which are directly passed to the buyers. Just to note closing costs on new construction homes are higher, as these extra fees are not associated with a resale home. Over the next 15 months the City of Orlando preliminary planned to raise impact fees by 18.8%. This increase would raise the current feee from $1,192 to $2,400 on 1/0/07, then to $3,600 on 10/1/07. This is lower than $6,147 which was initially recommended by consultants. Affordable housing developments are exempt. The Orlando Mayor and developers were please with a compromise and reduced increase. The Executive Director of the Orlando-based Coalition for Property Rights oppose the impact fee indicating this will continue to make Orlando Real Estate unaffordable. There is a committee implemented to review whether fees will increase again for 2008. Courtesy of Orlando Sentinel 7/25/06.

VA Hospital Coming to Lake Nona in Orlando

A new VA hospital is coming to Central Florida and will be its biggest Federal project ever. The final decision by key congressional committee to approve the site to be located in Lake Nona. Lake Nona is south of Beach Line Expressway SR 528 and just southeast of Orlando International Airport. This was good news to the UCF administration as they announced several months ago, plans to build a medical school in the same area. In Lake Nona and surrounding areas 37,000 homes are expected to be built by 2020, also a result of housing need for the creation of innovation way a technological sector for corporation. For those moving to the area and need more information, please contact http://www.orlandobuyersbroker.com/.

June Facts on Orlando Real Estate

• June Housing Inventory still at an all time high at 18,437
• Average Home on the Market 57 days
• 2,680 Homes Sold in June
• Orlando Unemployment Rate 2.8%
• Average Mortgage Rate in June 6.45%
• Foreclosures down, even Orange County one of the regions worst rates

FHA Loans Are Changing for the Better

FHA loans are government backed loans which are good for buyers with less than perfect credit and allow low down payment requirements, but they did not come without stringent requirements compared to conventional loans. As a result, these loans have negative appeal amongst real estate industry, because it almost requires a home to be in great condition and requires more work on behalf of the seller to bring the home up to FHA standards. FHA has taken several steps to move into the 21st century by making significant changes.

• To keep up with increasing home prices, the new maximum amount allowed to borrow is up to $362,790 which was a $50,000 increase. There is another proposal to increase the amount to $417,000 in certain high cost areas.
• Certain items on inspection reports were required to be fixed prior to closing even cosmetic issues. Now only structural or safety issues are require to be fixed.
• Obtain a FHA 203k loan will allow the borrower to borrow up to $35,000 in repairs to be completed after the closing. Borrowers can now replace worn-out appliances and carpet without the need for a second more costly mortgage.

It is still wise for a buyer to try to obtain conventional mortgage if they can. To learn more about FHA financing options, please contact First Choice Financial at eric@specialtymortgage.com Courtesy Orlando Sentinel 7/9/06.

Real Estate Closing Costs

Closing costs are require costs by both the buyer and the seller at the end of a real estate transaction. When you purchase a home in Orlando, it is decided in the contract who will pay for title insurance. Whoever pays for title insurance, gets to pick the title company. Title insurance, is one of the many costs, and is approximately .6% of the purchase price. Orlando Sentinel Article, http://www.orlandosentinel.com/business/orl-title1606jul16,0,1163540.story discusses that consumers are choosing their title companies due to varying costs. Allan Michaels with Title USA has straight forward fees and competent title agents which takes care of all the issues for both sellers and buyers alike. If you need an Orlando based title company, contact Title USA http://titlesourceusa.com/