ORRA Reports Rising Inventory & Declining Sales in its December 2023 State of the Market

As expected, the annual holiday season is a time for joy, peace, family, bustling air travel and a slowdown in housing. But something was different this year — elevated interest rates are significantly impacting home demand. According to the Orlando Regional Realtor® Association, data based on December 2023 sales for Central Florida, showed 23% year-over-year increase in total inventory with 11% decrease in closed sales during the same period. Fortunately for homeowners, values are staying resilient. An all-time high median home value of $370,500 in 2023 was up slightly 1.5% over the $365,000 median value recorded in 2022, albeit flattening out over the long-term. The average mortgage rate peaked at 7.8% in Oct. 2023, a record-high, but receded in Nov/Dec closing-out the year at 6.6%. Notably, months’-supply-of-inventory spiked by +39% year-over-year, an indicator of lower inventory absorption. Bottom line, supply & demand look to be re-balancing & the future of interest rates will determine the future of the housing market. Financial markets rallied last month after the Federal Reserve hinted at interest rate cuts in 2024, but inflation remains “hot” in some sectors of the US economy. The next Fed decision on interest rates is scheduled for February 1, 2024. Full report available here: December 2023 State of the Market