What weird times we’ve been living! 2020 seems to have taken us all by surprise and it has certainly thrown a curveball in all facets of our lives. We have experienced massive spikes in unemployment, lockdowns, and political unrest throughout this time, but how did all of these issues affect the real estate market here in Orlando? Surprisingly, not much at all.
On March 17th, 2020 I recorded my predictions for the impact of the pandemic on the market in my Orlando Living® podcast (you can listen to that episode here ), and they were accurate on many accounts. What we have seen throughout these difficult months is that regardless of the financial uncertainty in the world, home values remained moderately stable and have actually increased since February of 2020. February saw median home prices at USD 250,000 and steadily increased with June data showing an increase of 6% at USD 265,000 (Orlando Realtors Association, source). Additionally, we have been experiencing some of the lowest interest rates our nation has seen in decades! As of the publishing of this post, Mortgage News Daily has reported an average rate of 2.89% for conventional 30 year-fixed and 2.5% for FHA 30 year-fixed. Compare this to the high in the last 52 weeks at 4.15% and you’re looking at savings of thousands of dollars.
In fact, let’s analyze these savings. Suppose a buyer purchased a USD 400,000 home back in May of 2015 at the average rate of 4.15% for a 30-year fixed mortgage and is considering purchasing a new home or refinancing a home of the same value, with today’s interest rate of 3.89%. The difference in monthly payments is in the ballpark range from USD 2,187 to USD 1,699 — a savings of 488/mo or 5,856/year! These savings can certainly start adding up, and we haven’t even factored in home value appreciation.
Experts speculate that interest rates may not decrease much further from these figures, and will steadily begin to increase over the next few months. For buyers looking to purchase, or for home sellers looking to upscale or downscale, now may be the optimal time to get into the market for a new home.
The only significant impact the pandemic had on the real estate market here in Orlando was the rate in which homes were being purchased. Due to a nearly 3 month lockdown, most buyers made the decision to stave off their real estate purchases with march seeing transactions in the mid 3000s, dropping down to the low 2000s in April and May. Fortunately, we saw a quick bounceback in June with sales transactions returning to the 3000s range. Now more than ever we find ourselves in a seller’s market! Limited inventory on the market gives sellers the optimal opportunity for getting the best price for their homes. While the US continues to work towards controlling the rise in outbreaks and slowly reopens back to normal operations, we still find that the real estate market is thriving and abundant with excellent opportunities.
As a Realtor®, my top priority is your safety and as such provide my clients with latex gloves and masks to be worn at all times during tours or face-to-face interactions. Although we must take added precautions until these situations are resolved, it certainly does not have to stop you from achieving your real estate goals!
Here are some of the precautions I take with clients:
- One-use disposable surgical masks offered to clients who do not have access to their own
- Latex gloves for touching surfaces throughout home tours
- Hand sanitizer before and after leaving any homes
- Social distancing 6ft apart at all times
- Rescheduling of the tour if homeowners/clients/myself start experiencing any symptoms.
- Virtual tours available via Facetime/Skype/Zoom showing every corner of the home until fully satisfied.
- Exemption of masks can only be made if due to a pre-existing health condition
- Any other accommodations can be made upon request
Additional updated guidelines for dealing with the pandemic can be found here.
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