Happy Month of June! It’s amazing how time flies. Schools are out and we are approaching the midpoint of the year already! As much is happening around the country and the world, our focus remains on the local real estate market.
This month, we will share with you some talking points at our Yao Team meetings. If you have any questions or comments to share, please email us at Info@TheYaoTeam.com. We love talking about real estate.
Housing Demand Continues to Exceed Supply
According to Orlando Regional Realtor Association, a total of 2,655 listings for sale in April this year compared to 7,659 for the same month last year. Understandably, last year’s figures were heavily impacted by the COVID-19 pandemic. But after a temporary pause, the trend of heavy demand on limited supply started and accelerated through the rest of 2020 and in 2021 to date with no sign of slowing down. We have more buyers than there are good homes out there. So we work together strategically through careful selection, mixed in with some new constructions, to help our buyers find the right home.
There Are a Lot of People Moving to Orlando
From homebuyer inquiries on our listings to renter inquiries on our own rental properties, we are seeing a lot of relocating families from different parts of the country. A common theme is that during the pandemic, many people found that their jobs allow them to work virtually from anywhere. The famous sunshine and open space in Central Florida continues to attract newcomers, boosting the local economy and adding to the housing demand.
This Isn’t a Bubble
With the high demand and resulting rise in home prices, many worry that this might be a repeat of the housing bubble of 2006. We remember 2006. At that time, the high demand was driven by rampant speculative buying by people who couldn’t afford to carry the loans over time. There were buyers that bought one home after another and we were surprised that they were able to continue to get loans. It is different this time. According to Morgan Stanley, risky mortgage products, such as loans with introductory periods, teaser rates, or balloon payments, comprised about 40% of the mortgage market between 2004-2006. Those factors are now at only 2% of the mortgage market. Our own experience in the last 10 years with our buyers and buyers of our listings, is that they have strong credit and financials.
It is a Difficult Time to Remodel Your Home Right Now
With the changing supply chain after the pandemic, there seems to be a shortage of many home-related items and shipping delays, not to mention skyrocketing material prices that increase the cost of remodeling projects and new constructions. We are learning that patience is a virtue, and a necessity, in this market!
Sellers Still Need Expert Representation
In any seller’s market, stories abound about how “easy” it is to sell a home. We can tell you that experience and expertise are still crucial in achieving optimum outcome for our home sellers. Buyers are “brainstorming” on how to beat out the competition and achieve a contract. In fact, we are on a panel to teach techniques to real estate agents on this. Know that not all sellers with stories of receiving multiple-offers end up closing with the best price or terms. We scrutinize every detail of an offer and proposal, strategize the best plan to bring a contract to a successful closing, counter unreasonable demands, and negotiate the best outcome from the beginning to the end to ensure everything important to our sellers is achieved without compromise.
We will stop here. As always, we welcome your questions and comments. Until next month, take care!
The Yao Team