Distressed sales account for 62.5% of Orlando-area home sales
Sales of distressed properties continues to dominate the market in the Orlando, Fla., area this year, according to a local trade association. The Orlando Regional Realtor Association said the level of home sales that aren't REO nor short sales rose for the fourth month in a row in May, accounting for about 37.5% of all sales. Therefore, sales of bank-owned homes and short sales on distressed properties make up 62.5% of the market, and these sales continue to hurt the overall median price in the central Florida region. The median price for bank-owned sales in May was $80,000 and $102,900 for short sales. The median price for normal existing homes sold in May was $155,000. With more normal sales, the overall median price of a home sold in Orlando in May rose 4.76% to $110,000 from $105,000 in April, yet remains 4.35% lower than $115,000 a year ago. Still, the overall median price increased each month since January. The association starting separating normal sales from bank-owned and short sales in May 2009. Since then, normal sales peaked in July 2009 at 58% of all sales and hit a low of nearly 25% in January, according to the ORRA. There were 2,367 sales transactions completed in Orlando in May, which is 15% lower than a year earlier. At the current pace, there is a 4.63-month supply of homes in the city, which is the lowest since December 2005. More than 10,200 homes are under contract and await close, according to the ORRA. Sales of existing homes within the entire Orlando metropolitan-statistical area fell 13% in May to 2,925 from 3,355 in May 2010. There is total inventory of 10,969 homes for sale in the area, according to the ORRA, although overall inventory is down 31.3% percent from this time last year with single-family inventory off 25% and condo inventory down 55.1%. "Our market indicators are pointing toward the existence of pent-up demand, which is caused in part by the current difficulties in securing a mortgage," according to Mike McGraw, chairman of the ORRA. "Lenders and bank regulators need to be mindful of the historically low default rates among mortgage borrowers of the past two years. We simply have to get back to sound, common-sense lending standards to provide mortgages to creditworthy borrowers who are buying homes well within their means." Write to Jason Philyaw.