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Inventory Shortage at Crisis Levels in Nation’s Hottest Housing Markets

For-sale inventory is stuck at crisis levels in some of the nation’s hottest housing markets where home values are appreciating fastest. The number of homes for sale nationwide has declined on an annual basis for the past 35 straight months, and just 16.7 percent of a panel of housing expertsii surveyed in December 2017 expect a meaningful increase of home building in 2018, a sign that limited inventory could continue to drive the housing market this year.

 

“Tight inventory fueled by a tight labor market and low interest rates propelled home values to record heights in 2017, but the outlook is now much less certain,” said Zillow senior economist Aaron Terrazas. “Tax reform will put more money in the pocket of the typical buyer, but will limit some housing-specific deductions. Overall, this should increase demand for the most affordable and ease competition somewhat in the priciest market segments. On the supply side, the market is starving for new homes, but it won’t be easy for builders struggling with high and rising land, labor and lumber costs. Aging millennials and young families may be able to find more affordable new homes this year, but they’ll most likely be in further-flung suburbs with more grueling commutes to urban job centers.”

Lack of inventory, coupled with strong demand from home buyers, is one reason why home values across the country are reaching new peaks. The median U.S. home value rose 6.5 percent over the past year to $206,300, the highest it has ever been.

 

Snapshot of $172M worth of Lake Nona projects underway

The fast-growing, 13,000-resident Lake Nona community in southeast Orlando is dotted with cranes, piles of earth and the machines to push ’em around.

Among developer Development Co.’s projects underway are three valued at  $172 million combined:

Flip through Orlando Journal‘s slideshow for a closer look at these developments emerging out of former pasture land.

Lake Nona is home to several businesses, including the new $430 million KPMG training and innovation center and New York-based Drive Shack Inc. (NYSE: DS), a new global golf entertainment company opening its first location in Lake Nona in 2018.

HOAR SELECTED AS CONTRACTOR FOR NEXT PHASE OF LAKE NONA TOWN CENTER

, Fla.; August 7, 2017 – Tavistock Development Company, a diversified real estate firm owned by Group, announced today that Hoar Construction has been selected as the Pre Construction Program Manager and Master General Contractor for the next phase of development of the  Town Center which will include a thoughtful collection of more than one million square feet of retail, restaurant, , office, and hospitality uses.

Developed by Tavistock Development Company, with Steiner + Associates serving as the exclusive retail planning, leasing and development services partner, Hoar Construction plans to break ground on the next phase of construction in the Fall with anticipated completion in 2020. Hoar Construction brings the experience of having previously completed several projects with Steiner + Associates.

“Our team is eager to be a part of this transformative project and to help bring the retail and entertainment portion of the Lake Nona development to life,” said Michael Parks, Florida Division vice president of Hoar Construction. “We have a long history working with partners like Tavistock and Steiner + Associates to create world-class developments, and we are excited to be part of this team.”

Lake Nona Town Center is a 100-acre, 3.8 million square foot mixed-use experiential magnet and regional destination nestled within the large-scale Lake Nona master-planned community. Lake Nona Town Center fronts SR-417, Orlando’s eastern beltway, and is located adjacent to Orlando International Airport and its new multi-model transportation hub and international terminal.

Site plan for next phase of the Lake Nona Town Center

Lake Nona Town Center has already successfully opened and leased 85,000 square feet of class-A office, a dual branded Courtyard by Marriott and Residence Inn by Marriott hotel, 16,000 square feet of retail and restaurant space and a multi-level parking structure that doubles as public art adorned with colorful dichroic glass, lighting and a ‘Code Wall’ and is attached to a six-story digital art monument called ‘The Beacon.’

Local favorites Bosphorous Turkish Cuisine and Chorma Modern Bar + Kitchen – named Best New Restaurant 2017 by Orlando Magazine have thrived in the space – adding to the unique culture and atmosphere.

Tavistock and Steiner are currently in negotiations with several theatres and are close to finalizing plans for a brewery, comedy club and live performance venue, bowling concept and several additional restaurants and retailers. At full build out, Lake Nona Town Center will include more than 80 specialty retailers, anchors, junior anchors, and restaurants.

One of the most successful master-planned communities in the nation with more than 10 million square feet of current and planned residential and commercial development, Lake Nona’s corporate pipeline includes major regional projects including KPMG’s $400-million training and innovation center and the newly announced Amazon high-tech fulfillment center, both of which continue to position Lake Nona as one of the fastest-growing communities in America and a significant job creator for both the region and the state.

Home Sales Spiked in March…and Sold Fast

Inside the Release, by on April 21, 2017

An abnormally warm winter, strong consumer confidence and robust underlying demand ended up being the perfect formula to push existing-home sales in March to their highest pace in over 10 years.

More notably, despite the fact that supply is extremely tight and buying a home has gotten more expensive, home sales are up convincingly from a year ago nationally and in all four major regions.

In addition to the 4.4 percent leap in sales last month, equally impressive was the fact that typically sold 11 days faster than in February and 13 days quicker than a year ago. There’s no question that buyers are struggling to find an affordable home to buy, and when they do, they have to act very fast just to have a chance.

To reiterate what NAR Chief Economist Lawrence Yun said during this morning’s press conference: “sales will go as far as inventory does.”

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Construction to start on Lake Nona’s first age-restricted community

Lake Nona’s owner has a project in the works that will bring a new residential option to the growing southeast Orlando community.

Development Co. LLC is planning a new 216-unit active adult community called The Gatherings at Lake Nona. The community would be built on 9.7 acres about one mile east of the VA Medical Center in Lake Nona off Laureate Boulevard.

The community also will include a pool, a 4,400-square-foot clubhouse, shuffleboard, standalone garages and a 218-space surface parking lot. Tavistock Development filed for an environmental resource permit on Aug. 1, and has submitted specific parcel master plan documents to the city of Orlando.

Beazer USA appears to be the builder of the project, according to documents. Donald W. McIntosh Associates Inc. is the project engineer/surveyor; Aecom Inc. is handling ecological sciences work; Broad and Cassel is the legal counsel; and GAI Consultants is handling landscape, irrigation and hardscape.

This project is poised to create new construction and vendor opportunities for local firms, and will bring a new residential market to Lake Nona that already boasts more than 11,000 residents in its single-family homes and multifamily complexes.

Home prices rise as listings disappear

Scant listings of houses for sale in the core Orlando home prices rise by 2.6 percent during the one-month period of February, according to a new report by Orlando Regional Realtor Association.

The midpoint sale price in February for an area that includes mostly Orange and Seminole counties was $205,000, which was up about 11 percent from a year earlier.

Despite limited options for buyers, rising prices and interest rates edging up, association members closed 2,423 sales in February. Sales were up 10 percent from a month earlier and basically flat from a year ago.

“We are headed into peak home-buying season with high demand but significantly fewer on the market compared to last year,” said Orlando association President Bruce Elliott, an with Regal R.E. Professionals LLC.

Central Florida’s job and population growth has been depleting the available listings, even as the appetite for rentals has grown in recent years.

One Orlando-area real estate agent said he listed a three-bedroom, one-bath house without central heat/air in the west Winter Park area for $219,000. Immediately, he said, seven investors offered cash with the hope of tearing it down to make way for new townhomes.

During February, Osceola had the greatest increase in sales among Central counties with 10 percent growth from a year ago. Orange County also had an increase in sales during the 12-month period while Lake and Seminole counties both experienced declines.

Orlando’s housing market wades further into 2017 with markedly fewer houses listed . Listings in February were down 21 percent from a year earlier and the area had a 3.5-month supply — about a month less than February 2015.

Overall for the area in February, houses sold within 69 days of hitting the market — almost two weeks faster than sales a year ago.

Looking ahead, families may be in trouble as orlando home prices rise because association members reported 5,849 pending sales. That is an increase of 8 percent from a year ago and 14 percent from a month ago. Orlando’s pipeline of pending sales in February had about 400 more houses and condos than it did last February.

Elliott said current market conditions make it particularly conducive to sell for owners who have been contemplating getting into the market. And for buyers, he added, getting professional help structuring offers is especially key leading into the most active sales season of the year.

Here’s the salary needed to afford a median-priced home in Orlando

Despite the fact that the median value of a home sold in the fourth quarter of 2016 was lower in 21 of the 27 markets analyzed by HSH.com, the decline in cost wasn’t enough to offset the increase in 30-year fixed mortgage rates, so the salary needed to purchase that median home rose yet again in all but five markets.

The top three most affordable markets and the salary needed there to buy a median-priced house house included Pittsburgh, $$32,373.50; Cleveland, $33,779.45; and Cincinnati, $36,520.35. The three least affordable markets included San Francisco, $160,589.84; San Diego, $113,530.43; and Los Angeles, $98,315.22.

And in case you wondered, if homebuyers in the Orlando metro area put 10 percent down instead of 20 percent, the required salary increases from $50,871.95 to $58,734.31.

Orlando ranks No. 2 in Forbes’ fastest-growing cities list

PHOTO VIA JOE SHLABOTNIK ON FLICKR.

  • Photo via Joe Shlabotnik on Flickr.

The results are in: Orlando is one of the fastest-growing metro areas in the country.
According to Forbes, Orlando is No. 2 in the country, just behind Cape Coral, in its ranking of the country’s fastest-growing metropolitan cities.

 Every year, Forbes compiles a list of America’s fastest-growing cities in an effort to give a “holistic picture” of places on the upswing.
 The magazine uses data provided by Moody’s Analytics to compare the country’s 100 largest metropolitan statistical areas in measures such as population, employment, wages, economic output and home values, coming up with a ranking of the top 25.

cities dominate the list with nine out of 25, more than any other state. Six of those cities are included in the list’s top 10.
The Cape Coral-Fort Myers area took the top spot, with a population increase of 3.39 percent and a projected growth rate of 3.61 percent for 2017.
The Orlando-Kissimmee-Sanford area ranks No. 2 on the list, but was No. 1 in job growth for 2016 at 4.57 percent. That growth is expected to decrease a bit this year however, with a projected rate of 3.54 percent.
The Deltona-Daytona Beach-Ormond Beach area, Jacksonville, the North Port-Sarasota-Bradenton area, and the Tampa-St. Petersburg-Clearwater area also made the top 10.

Should you pay for a home warranty?

Orlando average price per square footPublished: February 22, 2017

If you’re going to get one, here’s how to use it correctly

If you’re in the process of buying a home, selling a home or will be in the near future, one of the costs you’re likely considering is a home warranty. But, as this is an optional expense, you have to decide if it will really be worth it to you.

“Home warranties [typically] cost between $300 and $700 a year and have a service call fee that ranges from $60 to $100, depending on the company,” Pam Maycumber of Keller Williams Realty Advantage III in Orlando, Florida.

What is a home warranty?

“A home warranty will repair or replace…covered systems and appliances when they break down from normal wear and tear,” Pam said. “Most often, home warranties cover the mechanical components of these appliances.”

Pam pointed out that these warranties are often part of a real estate transaction, but can be purchased by a homeowner at any time. However, consider the expense of that repair item. Whether it comes at the seller cost or the buyer cost having a home warranty is a terrific tool for peace of mind, and a real cost savings. Speaking from personal experience, Allyn and Pam Maycumber, point out hundreds of satisfied customers that have had a wide range of maintenance items covered by a home warranty.

Remember, if you are selling your home you can cover yourself during the listings time period AND it will cover the new home buyer for one year after their closing. Our customer in the Lake Nona area of Orlando, Florida had their home on the market . One of the air conditioning units failed, and then was replaced by the home warranty company. This covered nearly $4,000 in expenses, and when the prospective buyer knew it was a brand new unit it was a tremendous plus and allowed the seller to focus on more cosmetic touch ups to enhance the property. It was a “win WIN” situation.

Is it worth it? that depends…

For a “buyer to renew or for a homeowner to purchase their own warranty is a total waste of money,” Adriana Mollica, a Hello for Teles Properties in Beverly Hills, California, said. However, she added that it depends on the situation, as it may be “a great idea for a seller to purchase [a warranty] for a buyer when selling their property” as an added feature to sell their home.

On the flip side these warranties can be great — and save you money — when they’re used correctly.

“As long as you hold up your end of the home warranty contract by making sure your systems and appliances are clean and taken care of, when they fail from normal wear and tear, a home warranty will cover the repairs and replacements,” said Chelsea of Fidelity Title. “Even if a home warranty doesn’t cover all parts of the system or appliance that needs to be replaced, the out-of-pocket costs that a homeowner pays versus what they would pay out of pocket without a home warranty translates to huge cost savings.”

Pam relayed, for those who purchase a newly built home with new appliances, “getting a home warranty probably doesn’t make much sense as long as they are already covered under a builder warranty. She said that a “home warranty makes the most sense when you have moved into a new home and the systems and appliances have been used previously” or when you’ve had your own items for two or more years.

“Before you buy a home warranty…make sure to read through the contract,” Pam advised. “Home warranties will explain in detail which parts of their systems and appliances they cover and which they don’t within their contract. In order to get value out of a home warranty it’s vital to know and understand what the plan covers and doesn’t cover.”

Deciding what you want the warranty for

According to Allyn Maycumber, a broker associate for Keller Williams Realty Advantage III in Orlando, Florida, it’s all about perspective. If you’re looking to get a warranty that will land you brand new items if yours break, you may be severely disappointed. But if you’re using it as a safety net, you may find comfort in your warranty.

“I look at home warranties as a way to buy insurance [so] that you have time to rebuild your emergency fund after purchasing your home,” Allyn said. “It can give you peace of mind that you will have heat all winter and hot showers for a year. But it is rare that a homeowner hits the jackpot and gets a new furnace from it, although I’ve seen that. If you do get a new furnace, it is going to be similar to the old one in terms of efficiency, so that won’t save you money either.”

Paying for home repairs

Unexpected home repairs can certainly do big damage to your bank account — which is one of the reasons it’s important to regularly feed that emergency fund. If you’re faced with a pressing expense, a balance-transfer credit card, low-interest personal loan or home equity line of credit could help you cover costs (and possibly spare you some interest.