Is the Orlando Real Estate Market About to Crash? My Thoughts as a Realtor
Understanding the Current Orlando Real Estate Market In the world of real estate, the ever-lingering question is, "When will the housing market crash?" As a seasoned realtor, I've fielded this question countless times, and I've witnessed potential clients expressing their concerns about buying property, fearing an imminent market crash. It's crucial to understand that today's housing market is vastly different from the circumstances that led to the infamous crash of 2008. In 2008, one of the primary triggers for the housing market collapse was the prevalence of adjustable-rate mortgages (ARMs). These loans featured initially low, introductory interest rates that later reset to significantly higher levels, catching many homeowners off guard and pushing them into financial distress. Fortunately, we are not facing such a scenario today. Fast forward to the present, and you'll find a different real estate landscape. While interest rates for buyers are relatively high compared to recent years, most sellers have locked in mortgage rates at historic lows, some even as low as 2%. This favorable interest rate environment has made homeowners hesitant to sell. After all, who would want to relinquish such advantageous financing terms? This seller's reluctance to list their homes has led to a shortage of available properties, resulting in rising home prices. As prices continue to climb and interest rates follow suit, the buying power of potential homeowners diminishes. In essence, the gap between what buyers can afford and what properties cost is widening, making it increasingly challenging for many individuals and families to enter the housing market. However, there's hope on the horizon. A lower interest rate, if it were to materialize, could further stimulate buyer demand. When rates drop, more buyers are motivated to enter the market, increasing competition for the limited supply of homes. This heightened demand tends to drive prices even higher, potentially exacerbating the affordability challenge. One aspect of the market worth noting is new construction. Builders have significantly increased the supply of homes, offering a wider range of options for potential buyers. While there is some softening in this segment of the market, with prices showing signs of coming down slightly, demand remains robust. Builders are also sweetening the deal by offering numerous incentives to encourage buyers to make their move. This combination of factors makes new construction an appealing option for those looking to enter the housing market. So, where does that leave us? As a realtor, I want to assure you that while the current housing market may seem daunting, it's not necessarily a precursor to a crash. It's a complex ecosystem driven by a variety of factors, including interest rates, seller sentiment, and supply and demand dynamics. The key takeaway here is that the housing market is constantly evolving, and it's essential to stay informed and work with a real estate professional who can provide expert guidance tailored to your specific circumstances. While it's natural to have concerns about the future, rest assured that today's housing market is fundamentally different from the one that led to the 2008 crash. It's a dynamic landscape that requires adaptability and a thoughtful approach to navigate successfully.
Read MoreHow to Buy a Home With NO MONEY DOWN Near Orlando
It's true. You really can buy a home in the Orlando area with no money down. You're not going to be living in downtown Orlando with the method I propose, but it's a means to an end if you need to save that cash. So, how do you go about getting a house with no money down? Well, it's pretty simple. You'll first need to see if you qualify for USDA financing. That can be done with a quick call to almost any lender. But, generally speaking, you'll need a 640 credit score, and a maximum household income of $110,000. USDA financing is a rural development loan, so it's not available everywhere. But if you qualify, there are homes available half an hour to 45 minutes from Orlando. You can get more information by clicking here.
Read MoreMoving to Florida from UK or Europe
A little over 10 years ago, my husband got his Green Card. We were living in Eastern Europe at the time. A funny thing happened when he got his permanent residence card. I started to feel really cold. I would lie awake at night and dream of the sun. I could feel Florida's humid air and the briny smell of the ocean. I desired the warmth, the sun, seeing darkened palm trees in front of cotton candy sunsets. I was sick to death of gray skies and winter. The fact that my husband didn't speak English and we had no jobs in the US didn't matter. I was ready for non-stop summer. Over 10 years have passed, and while much of the research involved in moving to Florida from Europe has become easier thanks to internet and smart phones, some of what I experienced still holds true. So here are my top tips. 1. Unless you are being sent to Florida with a job from Europe, you have your choice of where to move to within Florida. Plan carefully. Take your time before you commit to an area. We rented a short term vacation rental for three months in Kissimmee, fully furnished, and it was marvelous. I'm pretty glad we didn't move there full time though. It's a great place to spend some time, very touristy, very close to Disney, but would not have been a good choice for my family long term. Don't just focus on the tourist areas. Explore neighborhoods, try to decide what type of home you like, and what your needs are. Do you like a single story? Do you need a pool? Do you need to live close to an airport? Do you need to live close to where job opportunities are in your field? We wound up in Orlando because it's not far from the ocean, we can be in the water in about 40 minutes, but we felt that we would be more protected from storms because we would be further inland. 2. Don't feel like you need to bring all your stuff with you on your move to Florida. Furniture is relatively inexpensive in the US. If you are really frugal, you can buy second-hand furniture for next to nothing. In America, we have a phenomenon known as "garage sales" where people take a weekend and sell their excess stuff out of their own garages. My husband was so confused when we first moved here, and there were these handwritten signs out all weekend long saying "Garage Sale." He thought that people were literally selling their garages. That's not exactly what that means. You can pick up a ton of stuff at amazing prices. I made the mistake of shipping a lot of stuff over to the US. There was no need. Relatedly, you may not need to bring so many of your clothes. It's so hot here and styles are really different. Perhaps you'll stick to your European clothing style, but I bet after a few years, you'll start to slip into the American trends until it starts to feel normal to you. It's just easier that way. Most of what I brought with me (wool sweaters, really?) has long since been donated. Your feet will spread out from widespread wearing of flip flops. Trust me on this. 3. You WILL eventually get used to the heat. We moved here in the autumn, right around Halloween, and I remember being in Walmart (and also trying to explain to my husband why there were like decapitated mummies all over the store -- that was fun) and then returning to our car, and climbing in the car and thinking we were all going to die from the heat. Within a few years, I was going for a walk one evening and I thought it felt chilly out. It was 90 (that's 32 in Celsius). 4. Houses are a lot bigger. My apartment in Latvia was 48 square meters. (That's about 500 square feet). So, when we arrived here, a 1,000 square foot home felt enormous. In reality, in Florida terms, that's pretty small for a family. And eventually, we bought a place just a little bit bigger than that. Boy, did we outgrow that quickly! Americans are consumers, and we fell right into that trap of buying stuff. And it's so easy, when, as mentioned, we would just visit garage sales on the weekends and buy tables and chairs and exercise equipment in great condition for nearly nothing. One thing I appreciated so much about European culture (forgive me for lumping everyone together, but in general this seemed to be true) is that you appreciate small amounts of fine things. Americans generally seem to prefer large amounts of inexpensive things. Again, this isn't everyone, and it's just my opinion, but you don't need to go further than Walmart to see this phenomenon in action. Don't forget that we don't buy toilet paper in packs of four. We buy packs of 48. You will need a place to put this. Everything is bigger. You will need to plan accordingly. All this to say, buy or rent a home that feels too big. As a side note -- I really struggled with understanding square feet. I just subtracted a final 0 from every number and then felt comfortable that that was close enough to square meters. 5. Relatedly, try to keep an open mind about housing. The houses here aren't old. We don't have homes dating back to the 1600s. Florida does have the oldest city in America, Saint Augustine, but even there, you won't find that the homes are that old. Oftentimes when I am working with European clients, they just don't like the houses that they find. They are looking for something that they are used to from home. So, here is my cautionary tale. I had a client once, and he just did not like anything I showed him, so he decided he would build something. The house prices at that time were extremely low, and I tried to help him understand that he could buy a great home at a super low price, and that building would be much more expensive. But he was adamant about building; and what's more, he wanted to import birch trees from his home county to build his dream home. I tried to explain to him that there were many reason why he wasn't seeing homes made from birch (a builder told me that the bugs in Florida would probably eat the birch before the home was even complete) but he would not accept the advice. He bought a parcel of land. He never built on it and he ended up selling it a few years later at a loss. I know things look different and it's going to take time to get used to, but I truly believe you will make out better if you just kind of resign yourself to the fact that this is the housing style maybe you can furnish the home with touches from your home country instead. 6. How are you going to buy a house, or even rent a house? In America we have something called a credit score. Basically, it is a score that gives lenders an idea of how likely you are to pay them back. It determines what kind of an interest rate you're going to get, how much they can lend you, and if they're even going to lend to you at all. Without a credit score, or with a low credit score, you'll even have trouble setting up an electric or water account, buying a car and getting a cell phone. Chances are, unless you are a seasoned and regular traveler, you are not going to have a credit score. To start building your credit, you'll want to head to a bank and open what's called a secured credit card. Basically, you put $500 into the bank, and they give you a credit card with a $500 limit. You should do this as soon as you can. Eventually, your bank will offer you an unsecured line of credit. To buy a home, most lenders want you to have 3 lines of credit. You should be able to achieve this in 6 months or so. 7. Realtors. Realtors in Florida are licensed. We have to take continuing education classes and work to maintain our licenses. Realtors are paid by the seller of the home in Florida. That means, if you are buying a home, our service to you is free. Did you hear that? Free. I recommend enlisting the help of an agent you trust when you arrive. One agent can show you all the houses that you want to look at, provided you aren't too geographically spread out. For that reason, I suggest you narrow down your location first, then find an agent. They will be a great resource to you as you start to figure out where to live. I personally did not understand how realtors worked, and I was a little afraid to commit to working with one. Our first home purchase was a mistake that we regretted pretty quickly, and in retrospect, I honestly believe we could have avoided that if we had just had one person we were working with, rather than calling every agent who represented the seller of a property. 8. Schools. Let's talk about schools for a moment. Even if you don't have kids, schools are important to consider for re-sale value of your home. Schools can vary widely and you can view school rankings online. In some parts of the world, you can fully choose where your child goes to school. In Florida, basically, your child will attend the school that's closest to your home. So your home is zoned for a certain elementary school, middle school and high school. You can choose to send your child to that school, and the education will be a public school, free education. Alternatively, many counties in Florida also have what is called a magnet school, which is also a public school offering free education. in the case of a magnet school, a county will establish a particular focus at a school in order to attract students to that school from other parts of the county. The focus might be something like music or math and science. You can elect to send your child to that school, but you must live within the same county. There are also charter schools. Those are schools that have been established by perhaps a group of parents or educators who set up a school and received public funding. Like with magnet schools, you may elect to send your child to that school as long as you are in the same county. If schools are important to you, you must research your school before committing to a house, because you are potentially going to be tied to the one that's closest to you. 9. Almost everyone in Florida is from somewhere else. If you so desire, you can quickly find someone from your home country. Yes, I've even met other people from Latvia here right here in Orlando. You will probably even be able to buy food products from your home country if you look around. There are people from all over the place here. You probably won't feel out of place. 10. And along those same lines, don't be afraid to ask for help. Americans aren't always the most well-traveled bunch, so they may not exactly understand where you're coming from, but they usually like to help, and are generally pretty friendly. Reach out if you're stuck! 11. Don't feel bad if you feel confused by the language. I am an American, and when I returned here, and English is my native language -- after 10 years away, I was blown away by the amount of slang that I had never heard before. I swear to you, I had never heard the phrase, "I know, right?" and suddenly it seemed like everyone was using. That's just one example, of which I had many. "Snap" was another. Snap? You mean, like with my fingers? Huh. If you have questions about moving to Florida from anywhere in the world where you might be, please reach out to me. So many people helped us get settled in. I'd be thrilled to return the favor.
Read MoreDo You NEED to Live in a Gated Community When Moving to Orlando?
The ubiquitous gated community of Central Florida. For so many of my buyers, especially those coming in from out of state, it seems to be extremely important to be in a gated community. It seems....safer. In this video, I did some deep undercover research (I sat in my car and filmed various gates to see if they were really doing anything) to bring you the best and worst types of gates. If you're going to pay to live in a gated community, you might as well consider what you're actually getting. Some of them appear to be about as much of a deterrent to entering the community as a plain old no trespassing sign. And some of them make you worry if you actually have enough proof of who you are to be allowed in. See it all, here:
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