Posts with tag 'rising home prices'

The Orlando area market found its footing in 2025. Home values held steady with roughly 1% year‑over‑year growth, and inventory levels between November and December ranged from 11,389 to 12,516 homes - a healthy, sustainable range for our region.

A major stabilizing force continues to be the large number of homeowners with sub‑4% and even sub‑3% mortgages. These owners feel no urgency to move, which keeps inventory from flooding the market. If they did list at typical levels, supply would nearly double and prices would fall sharply. Instead, their reluctance to sell has helped maintain balance and protect home values.

As we enter 2026, mortgage rates are averaging around 6%, but buyers have more flexibility than they may realize. Builders and motivated sellers are frequently offering concessions that allow buyers to negotiate rates below 5% through temporary or perma...

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Over the years, various economic events and factors have caused fluctuations in inventory levels and home values. Significant imbalances between supply (inventory) and buyer demand can take a year or two to fully impact the market.  Our chart tracks these changes from 2001 onwards.

In the early 2000s, low housing inventory led to rising prices.  When inventory bottomed out in 2004, prices saw a sharp increase in 2005.  However, between 2006 and 2008, inventory levels tripled due to the banking crisis, bad loans, and investors offloading properties.  This resulted in a significant decline in prices, bottoming out in 2010.  As inventory decreased again, driven by investor purchases, prices stabilized and began to grow steadily.

From 2019 to 2021, inventory levels hit all-time lows, driving prices up by 35%.  This surge was fueled by historically low interest rates, high investor demand, and increased migration to Florida due to COVID-19 restrictions in other states.  By 2023, inflation led to rising long-term interest rates, slowing buyer demand, and reducing the presence of instant cash buyers.  As of January 2024, the market has become more balanced, though desirable homes still sell quickly.

In 2024, inflation began to stabilize, and the Federal Reserve lowered the federal funds rate. However, mortgage rates remained between 6% and 7% for most of the year, leading to price stabilization due to higher inventory levels and a balanced market.

In 2025, inventory levels remained consistent to 2024 levels, due in part to many potential sellers being "mortgage-locked" into their current homes.  We can thank this rare phenomenon for keeping our inventory levels consistent, otherwise we might start seeing price drops similar to 2008-2010 when inventory levels were double what they are now.  

For 2026, it's my opinion that prices will either stay consistent, or drop as much as much as 2%.  Experts think our prices will grow slowly, at around 1%.  We have shifted from an "even market" to a "buyer's market" in central Florida.  Many sellers are offering closing cost concessions to buyers, in order to sell their homes.  Even the very nicest homes are selling with concessions in early 2026.  Our market is being driven by new buyers to Central Florida and first-time buyers.  Many "upsizing/downsizing" buyers are sitting on their sub-4% and sub-3% mortgages and not entering the market.  These are the "mortgage-locked" buyers that are preventing our inventory levels from exploding, causing a serious price correction.

For assistance with selling your current home and buying your next one, contact Frank Plesko at 407-421-6412.  We look forward to helping you soon!

Article written by Frank Plesko, Watson Realty, compiled from Orlando Regional Realtor Association's Monthly Sales & Inventory Reports, and Frank's market observations.

In a word?  Demand.  Despite interest rates continuing to fluctuate between 6.5% and 7.0%, demand for central Florida homes continues to be very strong.  For the 15^th consecutive year, Florida real estate is the top choice for international buyers, with Canada being the largest group.  The other large group of (non-Floridian) buyers have been coming from certain northern and western states that generally have higher taxes (see list below). 

Five of the

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This brief Q+A may help you decide if NOW is a good time for YOU to sell your current home, then buy your next home!


Q – Won't prices come down because of higher interest rates? Isn't the market going to crash?

A – Rates have been higher since May 2022, and it is NOT happening.  For July 2023, prices/values are flat vs. this time last year.  It's been that way for about 3-4 months now.  Demand for Florida (Orlando-area) housing is very high, with buyers from high-tax states as well as international buyers continuing to drive our market.  Instead of prices coming down, savvy sellers and builders are offering interest rate buy-down cash contributions to buyers, which allow buyers to

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