Orlando, FL residents looking to sell their homes have been in luck recently, as the average home sale price has steadily risen since 2010 throughout the counties of Orange, Seminole, Osceola, and Lake.
But now that more people have become real estate agents in order to piggyback off the success of the local housing market, will Florida’s real estate market be able to support itself or will prospective buyers start looking for homes in a more affordable region?
According to the Orlando Sentinel, asking prices for homes in the Orlando region have risen so dramatically in the past five years that real estate agents have been able to earn commissions that are 20-30% higher than in 2010; this is a big deal, considering that the average worker in Orlando only saw a 4% increase in wages during the same period.
According to the Bureau of Labor Statistics, real estate brokers in the four-county Orlando region earned an average salary of $76,030 in 2014, which was a 21% increase from 2010. This mirrored the increase of sales prices during the same period, which went from $131,000 to $180,000.
It really comes as no surprise, then, that over twice as many new real estate agents sought licenses in 2014 than in 2010.
To be sure, Orlando isn’t the most expensive place to live in the U.S. Compared to California, where the average mid-priced home sells for around $393,000, Florida’s housing market seems pretty darn affordable.
However, real estate markets across the country hit the same roadblock when the economy tanked back in 2007: people became “locked in” to their homes and neighborhoods because they simply couldn’t afford the costs of moving.
A recent Bloomberg View article dissected this complex trend, but the simplest conclusion that likely affects Orlando’s housing market is that Americans are moving, but they aren’t moving often and they aren’t moving very far.
Without an influx of new homeowners, Orlando may not be able to support its current housing market, and this would have a “trickle-down effect” if more real estate agents begin bringing in less income.
The regional housing market may seem stable now, but will we have the same positive opinion of the 2015 market in five years from now? Only time will tell.