In this article, our focus will be on the Orlando real estate market trends and investment opportunities in 2020. Orlando home prices are expected to rise by 3.2% in 2020. Owing to its picturesque beaches and rapidly improving quality of life, Orlando, FL is proving to be a secure real estate investment destination for not only local but also international investors.
With a median rent price of $1,599, the Orlando rental property market is expanding at a great pace and people from all over the country and even beyond are either choosing to move permanently or invest here.
Compared to other cities with competitive real estate markets, investing in the Orlando real makes more sense since it has experienced a 6% increase in property prices in a year.
According to Zillow, the first-time buyers in the U.S. looking for an affordable home without much competition may have the best luck in the State of Florida, with Orlando real estate market ranked high in the “Top 10 best cities for first-time home buyers.”
Is Orlando going to be one of the hottest real estate markets for investors in 2020? To answer this question, let’s take a look at the latest Orlando housing market trends and find out the prospects of investing in the Orlando real estate in 2020.
Orlando Real Estate Market Forecast 2020
What are the Orlando real estate market predictions for 2020? Orlando housing market 2020 is shaping up to continue the trend of the last few years as one of the strongest markets in the United States.
According to Zillow.com, the median home value in Orlando is $243,900. Orlando home values have risen by 4.1% over the past year and their Orlando real estate market forecast is that the prices will continue to rise by 3.2% within the next year.
Here is the Orlando real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of 3.2% till Sep 2020.
The median list price per square foot in Orlando is $158, which is higher than the Orlando-Kissimmee-Sanford Metro average of $150. The median price of homes currently for sale in Orlando is $289,000 while the median price of homes that have been sold is $244,800.
Zillow reports that 20.4% of the listings in Orlando had a price cut in Sep 2019, which is a good thing for buyers. It shows sellers were willing to negotiate on prices as they were finding it more and more difficult to sell homes at asking prices.
The median rent price in Orlando is $1,592, which is lower than the Orlando-Kissimmee-Sanford Metro median of $1,600.
Orlando Housing Market Forecast 2019 – 2021
Here is a short and crisp Orlando housing market forecast for the 3 years ending with the 3rd Quarter of 2021. The accuracy of this forecast for Orlando is 85% and it is predicting a positive trend.
The LittleBigHomes.com estimates that the probability for rising home prices in Orlando is 85% during this period. If this price forecast is correct, the Orlando home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.
Check this page each quarter for updates to the Orlando, FL Real Estate Market Forecast.
Orlando Real Estate Market Trends
We shall now discuss some of the most recent housing trends in the Orlando area. Trulia has 3,615 resale and new homes for sale in Orlando, FL, including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process.
The median sales price of homes in Orlando is $255,000 and homes are selling for about $154/sqft. Some of the most popular neighborhoods in Orlando are Alafaya, Meadow Woods, Metro West, Lockhart and College Park. Here you’ll find the maximum no. of listings.
Currently, there are 253 active listings in Alafaya, Orlando, FL and the home prices range from $40K – $7.5M. Additionally, there are 158 Orlando rental properties for sale on Trulia and their rent price ranges from $1,030 – $3,350. The schools are rated between 3/10 – 9/10.
Similarly, there are 174 active listings in Meadow Woods, Orlando, FL and the home prices range from $35,000 – $578,000. Additionally, there are 67 Orlando rental properties for sale and their rent price ranges from $650 – $2,750. The schools in this neighborhood are rated between 3/10 – 8/10.
In the past month, 1207 homes have been sold in Orlando, FL as reported by Redfin.com. In addition to houses in Orlando, there were also 759 condos, 422 townhouses, and 21 multi-family units for sale in Orlando last month. The median price per square foot in Orlando has increased by 3.5% over the past year.
According to their statistics, the Orlando housing market is very competitive. Homes in Orlando receive 1 offers on average and sell in around 26 days. The average sale price of a home in Orlando was $246,000 last month, up 5.2% since last year.
The average sale price per square foot in Orlando is $148, up 3.5% since last year. Homes typically receive 1 offer. Homes sell for about 3% below list price and go pending in around 26 days. A hot listing in Orlando can sell for around list price and go pending in around 7 days.
Here is the latest Orlando housing market data for the month of Oct 2019 from Redfin.com. The sale to list price ratio shows us that it was buyer’s market in the past month.
Orlando Housing Market Trends in Oct 2019 |
|
| Median List Price | $295,000 |
| Avg. Sale / List | 97.4% |
| Median List $/Sq Ft | $158 |
| Avg. Number of Offers | 1 |
| Median Sale Price | $246,000 |
| Avg. Down Payment | 28.7% |
| Median Sale $/Sq Ft | $148 |
| Number of Homes Sold | 1207 |
There are 5,360 homes for sale in Orlando, FL on Realtor.com. The new listings are 383. The asking price of Orlando single family homes can start from $29,900 and can go up to $7.7M for a luxury property Nestled within the Golden Oak community and neighboring Four Seasons Resort.
Additionally, there are 2,048 Orlando rental properties for sale, and their rent price can go up to $13,000 per month. The median rent in Orlando is $1,550. There are 453 new construction homes for sale in Orlando as of November 2019, within a price range of $207,900 to $7.7M.
According to their statistics, in October 2019, the Orlando housing market was a seller’s market, which means there were roughly more buyers than there were active homes for sale.
Ideally a buyer would prefer a sale to asking price ratio that’s closer to 90%. In Orlando, the sellers have held good leverage in these negotiations in the past month.
On an average, they could sold homes for 97.98% of the asking price. A seller would always prefer scenarios which can yield a ratio of 100% or higher.
In October 2019, the median list price of homes in Orlando, FL was $275K, trending up 6.4% year-over-year. The median listing price per square foot was $155. The median sale price was $246,500.
On average, homes in Orlando, FL sell after 66 days on the market. The trend for median days on market in Orlando, FL has gone up since last month, and slightly up since last year.
As per the data given on Movoto.com, the median list price in Orlando is $320,000. The median list price in Orlando was less than 1% change from October to November. Orlando’s home resale inventories is 2,793, which decreased 3 percent since October 2019.
The median list price per square foot in Orlando is $162. In October 2019 it was $161. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in November.
The data from the Orlando Regional REALTOR® Association shows that the Orlando housing market enjoyed a 2% increase in median price for the month of March 2019, while year-over-year inventory rose 5% and experienced its fifth consecutive month of increase. Sales dropped 11% compared to last year.
The overall median price of Orlando homes (all types combined) sold in March 2019 is $235,000, which is 2.2% above the March 2018 median price of $230,000 and steady compared to the February 2019 median price of $235,000 as well.
Year-over-year increases in median price have been recorded for the past 93 consecutive months; as of March 2019, the overall median price is 103.5% higher than it was back in July 2011.
The median price for single-family homes that changed hands in March increased 2.0% over March 2018 and is now $255,000. The median price for condos increased 3.7% to $127,500.
The Orlando housing affordability index for March is 133.81%, up from 131.64% last month. (An affordability index of 99% means that buyers earning the state-reported median income are 1% short of the income necessary to purchase a median-priced home.
Conversely, an affordability index that is over 100 means that median-income earners make more than is necessary to qualify for a median-priced home.)
Sales of single-family homes (2,450) in March 2019 decreased by 10.7% compared to March 2018, while condo sales (395) decreased 6.4% year over year. Sales of distressed homes (foreclosures and short sales) reached 110 in March and are 6.0% less than the 117 distressed sales in March 2018. Distressed sales made up just 3.5% of all Orlando-area transactions last month.
The overall inventory of homes that were available for purchase in March (8,117) represents an increase of 5.3% when compared to March 2018, and a 0.9% decrease compared to last month. There were 4.4% more single-family homes and 22.7% more condos, year over year.
Current inventory combined with the current pace of sales created a 2.6-month supply of homes in Orlando for March. There was a 2.2-month supply in March 2018 and a 3.4-month supply in February 2019.
The above data and statistics were taken from Orlando Regional REALTOR® Association. You can visit their website for more information.
Orlando, FL Single & Multi-Family Homes Statistics
Following the real estate market decline in 2007 in the U.S., single family rental homes became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate.
Single family rental properties have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.
U.S. single-family rental market has seen steady rent increases between 2010 and 2019. According to CoreLogic’s latest Single-Family Rent Index (SFRI), which analyzes single-family rent price changes nationally and among 20 metropolitan areas, it shows a national rent increase of 3% in April 2019, as compared to 2.8% in April 2018.
The average sales price of new homes sold in the U.S. fell by 1.6% year-over-year in July 2019, to $388,000, according to the U.S. Census Bureau. In fact, the median sales price of new homes sold fell by 4.8% to $312,800 over the same period.
For existing homes, the median price was up by 4.3% to $280,800 in July 2019 from a year earlier, according to the National Association of Realtors. July’s price increase marks the 89th consecutive month of year-over-year gains. Demand remains robust. During the year to July 2019, new and existing home sales increased by 4.3% and 2.5%, respectively.
As per the real estate company called Neigborhoodscout.com, the median house price in Orlando, FL is $224,349, which indicates that home prices in Orlando are well above national average for all cities and towns in the United States.
Large apartment complexes homes are the single most common housing type in Orlando, accounting for 49.02% of the city’s housing units. One or two bedroom apartments are the most common housing units in Orlando.
Other types of housing that are prevalent in Orlando include single-family detached, duplexes, homes converted to apartments and a few row houses. Orlando is dominated by renter-occupied one, two, or no bedrooms apartments. 65.29% of Orlando’s dwellings are rentals.
After the great recession of 2008, renting a home has increased exponentially across the nation. There are currently over 136.57 million housing units in the U.S.
In 2018, the total number of homeowner households hit an all-time high of 76.2 million. 36.6% of households rent their homes and 64.4% buy their homes (2018 U.S. Census Bureau).
Currently, there are 1,678 single family homes for sale in Orlando, FL on Zillow. Additionally, there are 661 single family homes for rent in Orlando, FL.
Under potential listings, there are about 35 Foreclosed and 498 Pre-Foreclosure homes. These are the properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
Orlando, FL Foreclosures And Bank Owned Homes Statistics
Looking for foreclosure homes in Orlando? As per the Orlando foreclosure data by Zillow, the percent of delinquent mortgages in Orlando is 1.2%, which is higher than the national value of 1.1%.
With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth.
The percent of Orlando homeowners underwater on their mortgage is 6.6%, which is higher than Orlando-Kissimmee-Sanford Metro at 6.1%.
| Total No. of Foreclosures in Orlando | 1,759 (RealtyTrac) |
| Homes for Sale in Orlando | 1,491 |
| Recently Sold | 11,177 |
| Median List Price | $277,000 (1% ⇑ vs Sep 2018) |
There are currently 1,759 properties in Orlando, FL that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 1,491.
In October 2019, the number of properties that received a foreclosure filing in Orlando, FL was 30% higher than the previous month and 17% lower than the same time last year.
Best Neighborhoods to Invest in Orlando Real Estate
If you are looking to buy real estate in Orlando, you should know the best places to invest in. The three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability. Desirability brings demand.
Demand would raise the price of your Orlando real estate and you should be able flip it for a lump sum profit. When looking to invest in Orlando real estate, you need to find places where the expected property appreciation forecast is positive.
The running costs for owning and managing an Orlando investment property should be low. The neighborhoods in Orlando must be safe to live in and should have a low crime rate.
The neighborhoods should be close to basic amenities, public services and shopping malls. There should be a natural and upcoming high demand for rental properties and a low supply of income properties.
Orlando is a minimally walkable city in Orange County. There are 145 elementary schools, 77 middle schools, 50 high schools and 130 private & charter schools. There are 161 neighborhoods in Orlando.
Some of the best neighborhoods in Orlando, Florida are Hunters Creek, Metro West and Conway, College Park, Audubon Park, Coconut Grove, Thornton Park, Park Lake-Highland, Baldwin Park, Downtown Orlando, Delaney Park, Roosevelt Park, Winter Park, Narcoossee South, Winter Park, Lake Nona, and Rose Isle.
Bay Hill has a median listing price of $774.5K, making it the most expensive neighborhood. South Semoran is the most affordable neighborhood in Orlando, with a median listing price of $110,000.
Here are the best neighborhoods to invest in Orlando real estate because they have the highest appreciation rates (List by Neigborhoodscout.com).
| 1 | Shiloh / Dummit Grove |
| 2 | Boggy Creek Rd / Dowden Rd |
| 3 | E Colonial Dr / Barton Dr |
| 4 | S Semoran Blvd / Curry Ford Rd |
| 5 | U of Central Florida / N Tanner Rd |
| 6 | Allison Dr / Bonneville Dr |
| 7 | Union Park |
| 8 | Fort Jefferson Blvd / Fort Thomas Way |
| 9 | S Goldenrod Rd / Curry Ford Rd |
| 10 | Doctor Phillips |
How is the Real Estate Investment in Orlando?
Investing in real estate is touted as a great way to become wealthy. Is Orlando a Good Place To Invest in Real Estate? Many real estate investors have asked themselves if buying a property in Orlando is good investment?
If you want to find out whether Orlando real estate is a good investment or not, you need to drill deeper into local trends. The Orlando real estate trends will tell what the market holds for the year 2020.
We have already discussed the Orlando housing market forecast for answers on why to put invest in this market. Purchasing an investment property in Orlando real estate is a little different from shopping for your car or primary residence.
Orlando, FL has been included among the cities for real estate investment for the year 2019. While you still want to get the most for your money, if you are looking to make a profit, you don’t want to buy the most expensive property on the Orlando real estate market and expect to make a good profit on rents.
Perhaps you are looking for a slightly different hold-over, a investment property in Orlando that you might move into or sell at retirement in the future! Either way, knowing your profit potential and purpose is the first thing to consider.
Let’s take a look at the number of positive things going on in the Orlando real estate market which can help investors who are keen to buy an investment property in this city. Here are our top ten reasons to invest in the Orlando real estate.
1. Increasing Foreign Investment
International investors from all major countries of the world are exhibiting their interest in the Orlando real estate market because of its beautiful scenery, improving quality of life and ambient weather.
It is also extremely popular for foreign investments because of its intercultural connectivity with people from various Latin American countries. In addition to this, many Chinese as well as Spanish and Middle Eastern investors are also attracted to Orlando, FL for real estate investment.
2. Dramatic Population Growth
Owing to people from various walks of life and demographic differences choosing to reside in the suburbs of Orlando, this city is going through a major population growth.
During the last 3 years, the population in Orlando has been growing at the rate of 7.2% which has never been experienced by this city before.
Orlando is rapidly becoming a central attraction for businessmen, students and small families owing to its growing trend of upward life mobility which makes lures investors to invest in the Orlando real estate market.
3. Increasing Job Opportunities
Orlando is the new hub for many young professionals especially those with various types of technological expertise, including engineers and IT professionals. This city has experienced an annual job growth of around 4.4% and is also one of the fastest growing metro areas in the country.
The city is also set to experience its highest job growth rate in the 10 years to come. A market with high job growth is a great market for real estate investment as well.
4. More Rental Income
Since job opportunities in Orlando are growing, people from all over the country and even some other countries are choosing to move here.
This directly translates to a boom in rental income as there is a resultant increase in the demand for both residential and commercial property rentals, and this means more steady income for investors in Orlando real estate market.
5. Transport Infrastructure
Another reason for the growing economy and population expansion in Orlando, Florida, is the developed transportation infrastructure which makes travelling between destinations more convenient. Generally, Florida has an efficient transportation network which complements its tourism growth as well.
6. Booming Economy
While improving Orlando real estate market and flourishing tourism are two of the most important reasons behind Orlando’s economic stability, these two industries have a lot to gain from the successful economy.
This expansion is related to the growing population and job opportunities in this city, this translates to more rental income and tourism leading to better economy for the city.
7. Flexible Tax Laws
Investing in Orlando real estate market can help investors to lighten their taxes as Florida is one of the few states with no personal income tax. Its flexible tax laws are a blessing for investors especially in this climate of booming economy.
Tax laws in Florida are considered to be 4th friendliest laws in the country which is why a significant number of businesses choose to be based here. Florida does impose a 5.5 percent corporate income tax.
8. Orlando is a Top-notch Tourism Center
Orlando has been boasting of economic stability since the beginning of the year 2018, and tourism growth and opportunities are one of the main reasons for its smooth expansion.
Considered to be a “Theme-Park Capital of the World,” Orlando attracts most of its tourism due to the presence of Universal Studios as well as SeaWorld and the most popular, Disneyland.
In addition to this, Orlando’s beautiful beaches and warm weather also attracts thousands of tourists every year.
9. Orlando Adds Value to Real Estate
Compared to saturation in similar markets in other cities like New York, Orlando real estate market has all the indicators of a flourishing growth in the current year.
Emerging Trends in Real-Estate 2018 has listed Orlando as the 16th growing real estate market in USA with potential to grow rapidly. This list also includes other cities from Florida like Miami, Ft. Lauderdale, and St. Petersburg.
10. Entrepreneurship in Orlando
Orlando, owing to its friendly tax environment and affordable real estate can prove to be a vital opportunity for up and coming start-ups. Entrepreneurs and small business owners can rent showrooms and shops on better terms than most other cities and states.
Investing in Orlando Real Estate: The Conclusion
Maybe you have done a bit of real estate investing in Orlando but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold.
A good cash flow from Orlando rental property means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt.
Orlando real estate market has a high potential for growth considering the current state of its economic expansion and population influx. This market currently has an ideal environment for US investors in housing properties especially for turnkey real estate investments.
Therefore, finding a good Orlando real estate investment opportunity would be a key to your success. If you invest wisely in Orlando real estate, you could secure your future.
If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate. The less expensive the Orlando investment property is, the lower your ongoing expenses will be.
When looking for real estate market opportunities in Orlando or anywhere in the country, the generally accepted standard is to purchase a property that will give you a modest but minimum 1% profit on your investment.
An example would be: at $120,000 mortgage or investment cost, $1200 per month rental. That would be the ideal equation example. Even with rent increases, buying a $500,000 investment property in Orlando is not going to get you $5000 per month on rent.
When looking for the best real estate investments in Orlando, you should focus on neighborhoods with relatively high population density and employment growth. We’ve already listed above some of the best neighborhoods of Orlando where you can think of buying real estate.
Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.
You must also collaborate and learn from savvy real estate investors who have retired early on in their lives by investing in some of the best real estate markets like Orlando, FL.
Beginners would usually follow the media, buy a property and wait for its value to increase. This could be risky. Real estate investing requires research. We recommend doing your own research or hiring a real estate investment specialist for guidance.
You should also join real estate investment clubs in Orlando and try to make connections with fellow investors. To be effective in the real estate industry, a concrete marketing design is vital. The real-estate market is constantly changing in their methods on how to look for that right property.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. Choosing a real estate professional/counselor continues to be a vital part of this process.
They are well-informed about critical factors that affect your specific market area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Orlando real estate in 2020. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Best Places in Florida to Invest in Real Estate
We also recommend Tampa FL real estate market for turnkey rental property investing. The real estate in Tampa Florida has been estimated to grow rapidly during 2020.
Investors are recommended to buy properties now and hold on to them until good price appreciation for maximum return on investment. The Tampa real estate market has been seeing constant development for the last two years, a trend that does not seem to be stopping any time soon.
Tampa has the headquarters of four Fortune 500 companies which makes it a moderately attractive city for work and economic growth.
In addition to this, many entrepreneurs and small businesses are also making way to Tampa for search of better prospects and lesser expenses for running their start-ups. Acquiring residential spaces is one of earliest priorities for such professionals when they move here.
Tampa, FL has a very diverse economy with financial services, STEM, health care, research, education, tourism, beaches, and military bases all making significant contributions to jobs and growth. These all factors make Tampa housing market a hot destination for real estate investors in 2019.
You can also invest in another hot market in Ocala, Florida. Ocala is an affordable real estate market for investors who can still reap a decent return on investment.
The area has recovered from the Great Recession, and a number of factors will insulate it from a future downturn. The Ocala housing market is buoyed by several nearly recession proof industries.
It is quite affordable for investors compared to the rest of Florida markets like Tampa where the median home value is $221,500. The median home price in Ocala in 2018 was around $150,000.
You can buy several homes in the Ocala FL real estate market for the price you would of one mid-market condo in Miami real estate market.
Another market that we suggest is the housing market in Lakeland, Florida. The Lakeland housing market presents the perfect balance of currently affordable real estate for buyers and future growth. We can expect the population of the area to grow rapidly, and the renting population will grow even faster.
The time to buy real estate in Lakeland is now. While the Lakeland FL real estate market is cheaper than Orlando and Tampa, it is not a good overall value given the lower average wages of its residents.
That explains why U.S. News and World Report gave the city an index score of 5.5 out of ten. This is due to the average resident earning around $23,000 a year, several thousand less than the U.S. average. Median household incomes are no better.
Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, you may fill up the form given here.
One of our investment specialists will get in touch with you to discuss all facets of searching for, buying, and owning a turnkey investment property.
*Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
References:
https://www.thebalance.com/the-best-places-to-invest-in-real-estate-4163978 http://www.noradarealestate.com/blog/best-cities-to-invest-in-real-estate-in-2018 https://www.mashvisor.com/blog/orlando-real-estate-market-new-investors
Reasons to Invest in Orlando Florida
https://www.lee-associates.com/centralflorida/2018/01/15/5-reasons-to-invest-in-central-florida/
Updated Market Data, Trends And Forecasts
https://www.movoto.com/orlando-fl/market-trends https://www.zillow.com/orlando-fl/home-values https://www.realtytrac.com/statsandtrends/fl/orange-county/orlando https://www.trulia.com/real_estate/Orlando-Florida https://www.redfin.com/city/13655/FL/Orlando/housing-market https://www.realtytrac.com/statsandtrends/fl/orange-county/orlando https://www.orlandorealtors.org/news/422237/ORRA-Housing-Market-Report—September-2018.htm http://www.worldpropertyjournal.com/real-estate-news/united-states/orlando-real-estate-news/orlando-home-sales-report-2018-orra-reports-orlando-regional-realtor-association-orlando-rising-home-prices-in-2018-orlando-real-estate-news-10995.php
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