Central Florida Housing Market Defies Traditional Supply and Demand Trends

Central Florida continues to present a unique case in the U.S. real estate landscape, defying several long-held economic principles. Despite Florida leading the nation with the highest number of empty homes and the largest inventory of homes for sale, the Orlando housing market paints a different, more complex picture.

Orlando: A Market with High Inventory and Rising Prices

Recent data reveal that the Orlando region has witnessed its highest inventory of homes since 2011. Typically, an increase in housing supply might suggest falling prices; however, median home prices in Orlando are actually increasing. While year-over-year sales have dropped by approximately 12%, there has been a modest month-to-month sales increase of nearly 4%.

Why Are Prices Rising Despite High Inventory?

Lawrence Bellido, President of the Orlando Regional Realtor Association and a seasoned central Florida Realtor for over 26 years, explains this as a reflection of a balanced market where sellers are motivated but buyers still have many options:

High inventory means sellers have more competition.
Sustained buyer interest prevents prices from declining.
Orlando remains attractive to real estate investors due to its strong growth potential.

Bellido emphasizes, “The homes that I’ve sold are coming in at a higher appraised value, so they’re maintaining their value.” While some market adjustments are anticipated following the COVID-19 buying surge, the region’s real estate is far from a falling market.

Central Florida: A Real Estate Gold Mine for Investors

Despite the cooling effect after the pandemic buying frenzy, Central Florida real estate is described as a “gold mine” for investors. The city’s continued desirability is causing prices to maintain strength even with an ample supply of homes available.

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"We should expect some price corrections," Bellido notes, "but the market is leaning towards a buyer’s market rather than a sharp decline."

Factors Fueling Central Florida’s Market Resilience

Strong local demand from families and investors.
Inflow of residents relocating from more expensive coastal areas.
More affordable inland living compared to coastal maintenance and insurance costs.

Affordability Challenges in Orlando’s Housing Market

One of the biggest challenges facing buyers in the Orlando area is affordability. With median home prices hovering close to $400,000, many prospective buyers face significant hurdles entering the market.

“I never thought I’d see the day where $400,000 felt like a premium price point, but now we’re approaching $390,000 to $400,000—and that number may rise.”

Why Is Orlando Still Hot While Other Markets Cool?

Several factors contribute to Central Florida’s persistent market heat while other parts of Florida experience steeper price declines:

Buyers moving inland from coastal regions to avoid higher property maintenance and insurance costs.
Orlando’s appeal as a family-friendly city with a strong job market.
Limited homes priced below $400,000, pushing median prices upward.

Market Inventory and Its Impact on Pricing

A healthy real estate market typically features about a six-month supply of homes. Currently, Orlando is close to this benchmark with about five and a half months of inventory.

When inventory hits or exceeds six months, sellers may begin lowering prices.
Until then, prices are expected to hold steady or even increase.

Navigating Central Florida’s Market: Tips for Buyers

Given the current market complexities, the best approach for first-time buyers and other home seekers is to utilize all available resources and expert guidance.

Essential Tips for Homebuyers in Central Florida

Explore local, state, and federal grant programs: Programs can help buyers access significant financial assistance.
Consult experienced realtors: Working with knowledgeable local agents is critical to understanding market nuances and securing the best deals.
Avoid solely relying on online listings: Online platforms like Zillow can be helpful but should not replace professional advice.

“I always recommend meeting the best local realtor for consultations to avoid pitfalls and ensure sound investments,” Bellido advises.

Watch These Central Florida Outskirts for Market Trends

Some outlying areas near Central Florida show different dynamics, with market downturns more evident:

West New Haven in East Polk County
Deltona-Daytona Beach-Ormond Beach market in Volusia County

These regions might present different buying opportunities depending on individual investment goals.

For more detailed insights into the Central Florida housing market and ongoing trends, visit resources like the Orlando Regional Realtor Association and explore federal homebuyer assistance programs at HUD.gov.

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