Orlando Housing Prices Could Rise 6% Next Year
Orlando housing prices are predicted to rise by 6 percent in 2017
Orlando’s metro area ranked at number 7 for the most promising housing markets in 2017, according to a forecast released by Realtor.com on Wednesday. The forecast calls for a 5.7 percent increase in Orlando housing prices and a 6.1 percent increase in sales volume for the region.
Overall, the national real estate market is predicted to slow compared to the last two years, across the majority of economic indicators, Realtor.com said.
According to Zillow, the median home value in Orlando is $158,200, and home values have gone up 10.3 percent over the past year. Zillow predicts home values will rise 6 percent within the next year. Home prices in the area still haven’t reached the highs they were at in 2007.
Nationally, home prices are anticipated to increase 3.9 percent and existing home sales are forecasted to increase 1.9 percent to 5.46 million homes.
Interest rates are expected to reach 4.5 percent due to higher expectations for inflationary pressure in the year ahead. Realtor.com said it expects a post-election interest rate jump that could potentially price some first-timers out of the market.
“We don’t expect the outcome of the election to have a direct impact on the health of the housing market or economy as we close out 2016. However, the 40 basis points increase in rates in the days following the election has caused us to increase our interest rate prediction for next year,” says Jonathan Smoke, chief economist for realtor.com. “With more than 95 percent of first-time home buyers dependent on financing their home purchase, and a majority of first-time buyers reporting one or more financial challenges, the uptick we’ve already seen may price some first-timers out of the market.”
The homeownership rate will stabilize at 63.5 percent after bottoming at 62.9 percent in 2016, according to the forecast. New home sales are expected to grow 10 percent, while new home starts are expected to increase 3 percent.
The forecast is based on GDP growth of 2.1 percent, a 2.5 percent increase in the consumer price index, and unemployment declining to 4.7 percent by the end of the year.
Source: “Orlando housing prices could rise 6 percent next year,” Orlando Sentinel