The number of homes sold in Central Florida sunk dramatically in May, an indication of the anxieties swirling around Orlando's previously booming market and the wide-reaching effects of the economic fallout caused by the coronavirus outbreak.
According to a new report from the Orlando Regional Realtors Association, there were 2,127 sales across Orange, Seminole, Osceola and Lake counties, a 44% drop from last May when there were 3,806 sales and an 11% decline from April when there were 2,393.
That marks the second straight month of declining sales in the middle of the home buying season.
Osceola County, which in April had the highest unemployment rate in Florida with 20.3% of the workforce out of a job, had the sharpest slump in home sales. The county, home to a large concentration of the region's low-wage theme park workers, saw its number of homes sold cut in half from last May, showing the severe impact that measures to curtail the virus' spread have had on areas extremely dependent on tourism and travel.
Despite the decline in sales, ORRA president Reese Stewart said in a statement that "forward-facing indicators are showing signs of eagerness within the market."
For example, there are 4,930 pending sales, up 34% from the 3,679 in April, and 3,717 new listings, a 32% increase from the 2,814 the month prior.
That could be a sign that some economists and real estate agents predicted right: that the virus' effects on the housing market would be temporary and not nearly as devastating as the financial and housing crises in 2008. Changes made after the housing crash have created safeguards to prevent another crash, and for the most part, homeowners are older, wealthier and more financially secure than they were during the housing crisis.
However, millions of homeowners have had to delay or reduce mortgage payments because of the virus as a record number of Americans lost their jobs. Black Knight, which analyzes data from the mortgage industry, said that as of June 2, 4.7 million home loans were in forbearance.
Still, industry experts have been optimistic that markets will rebound quickly, but that will depend on how the government reacts to rising hospitalizations and how quickly treatment for COVID-19, the disease caused by coronavirus, is developed. In previous interviews, Stewart said Orlando's housing market had been so hot before the pandemic hit that it was on a much stronger footing to come out unbruised once the health emergency passes.
"We're not in a housing crisis. We're in a global pandemic," Stewart said. "All indicators are, once this passes, we're going to be in a strong real estate market."
And even though fewer people are buying and selling homes, prices haven't budged, unlike in the previous recession when foreclosures came en masse and prices subsequently plunged. The median price for a home, including townhomes, single-family houses and condos, is $259,900, 7% higher than the median price last May and just 1.5% less than the April 2020 median price.
Housing markets likely haven't cratered because the workers who have been most severely affected by the virus are low-wage workers who primarily rent. In Florida, for instance, a report from Zillow found that service industry workers who have lost their jobs owe $84.7 million a month on rent or mortgage payments, and a majority of that, 72%, is rent.
Housing advocates expect mass evictions to begin once Gov. Ron DeSantis' moratorium on them, which he expanded a second time until July 1, expires.
