5 reasons to invest in orlando
Much has been written about the recovery from a long housing slump in Florida, but according to Florida property investment firm Colordarcy.com, the standout location for those considering an investment property is Orlando for 5 reasons.
Loxley McKenzie Managing Director of Colordarcy.com comments: "The transformation we have seen in Orlando's property market fortunes has been spectacular in the past 12 months.
“Orlando was hit hard by the housing slump in Florida - so hard, that it has created this silver lining of rising prices and risings rents. Rarely do you see both which is why there is a great opportunity for investors.”
According to analysts at Colordarcy, the following 5 reasons should convince even the most sceptical property investors to seriously consider Orlando property.
1. Rising home prices
The value of existing property in Orlando has increased by 23% in the last 12 months and 3.1% between April and May this year (Source: Orlando Regional Realtors Association, June 2013).
Orlando median property prices have risen from $120,000 in May 2012 to $148,000 in May 2013 according to the same report released this month.
2. Prices are still far below where they should be
Even factoring in this high level of growth in the Orlando property market, there is ample room for further growth according to Colordarcy analysts who highlight that that prices are still some way below what they should be.
The long term average rate of house price appreciation in Orlando is 3% a year (Source: Orlando Sentinel, June 2013). House prices in Orlando still have further to go before they reach the level they were at back in 2004.
3. The supply of homes is getting tighter
One strong reason for the recent growth in prices has been a tightening of the supply of homes in Orlando. The stock of homes available for buyers has fallen from 2.6 months to 2.55 months, which according to local realtors is less than half what is expected.
4. Time on the market has almost halved
As supply has tightened so to as the length of time it takes to sell exiting homes. In May the average time it took to for a home in Orlando to be put up for sale and then sold was 68 days, down from 76 days a month earlier.
This was the shortest length of time since August 2006. This timeframe is also far shorter than the 128 days it took to sell a house in 2008.
5. Rising Rents
One of the main things to consider as a property investor is the cost of ownership according to Colordarcy. This should be covered by the rent and in Orlando, investors can take advantage of rents rising by more than 10% a year in some locations.
Rental yields in Kissimmee, for example, are typically 8%. Growth in average rents in Kissimmee has reached 7.2% to $889 in an area that felt the full force of the housing slump.