ORANGE COUNTY, FL QUARTERLY RENTAL REPORT
2019:
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2023:
Great News
Orange County, Florida has set a new record with the median rental price soaring to an all-time high of $2,645 in 2023. The median sale price has also risen to $415,000, marking a 6% increase from the previous year. Despite initial concerns of a rental market correction, Florida’s market remains resilient, owing to the steady influx of 1,500 people relocating to the area every week. Thanks to the massive wealth transfer into the state, luxury rental markets, such as homes in Windermere and Doctor Phillips (Area Code 32836), have seen median rental prices skyrocketing past $3,500 per month, with several rentals commanding more than $10,000 per month.
Pay Attention
The rising insurance rates and association dues have affected homeowners and investors. The insurance rates for many condominiums and townhomes have increased by 3040%. As a result, several owners have switched to Citizens Insurance, which is a state-backed insurance provider that was supposed to be a last-resort option. Simultaneously, association dues have also increased, forcing some owners to sell their properties. Most condominiums in downtown Orlando have increased their monthly assessment dues and levied a one-time special assessment to cover the depleting reserves or necessary repairs. The cost of labor and materials has eaten into the budgets set by associations, causing townhomes to experience increased dues. If you currently own or are planning to purchase a townhome or condominium, it’s important to keep track of certain
details. Make sure you know the age of the building, as well as the age of the roof. Additionally, you should be aware of the association’s budget and reserves. By staying on top of these factors, you can identify any potential issues before they become serious.
More Opportunities & Competition
Interest rates are currently between 6-7%, which has caused many potential buyers to hold off on making purchases. As a result, mortgage applications have decreased by 12% in 2023, leading to a significant drop in the total number of sales. However, cash buyers and those who are willing to take on higher interest rates in the hopes of refinancing have been making the most of the situation. With less demand and increased inventory, buyers now have an advantage, with the number of properties for sale currently at its highest mark since 2021. Gone are the days of escalation clauses, no contingencies, and bidding wars. While there are still opportunities for investors, they must do their homework and be realistic about potential returns. Over the past year, the number of active rental listings in Orange County has increased by 62%, leading to increased competition between owners. To avoid extended vacancy periods, owners must price their rentals accordingly.
By Evan Caulfield, Stockworth ManagementDisclaimer: All investment strategies and investments involve risk of loss. Nothing contained in this article should be construed as investment advice.
Sources: U.S. Bureau of Labor Statistics, U.S. Census Bureau, U.S. Department of Housing and Urban Development, Orlando Regional Realtor Association, Stellar MLS, Freddie Mac.
