Central Florida has become the destination for affluent buyers looking to purchase a luxury home. The local luxury real estate market indicates a buyer’s market; however, that temperature will shift as forecasts show the transition to a seller’s market for luxury homes in the next two years. Here, I share my insights into the Central Florida luxury home market, and why I, like many other real estate professionals, have followed the migration toward this area.
A market snapshot.
Almost all luxury homes are sold through a luxury real estate agent. The market indicators show that we are in a luxury buyer’s market with a 9 percent sales ratio in 2018. Luxury home sales in 2018 are selling at a median of about 95 percent of the listing price. The most desired price range for buyers is from $1.2 million to $1,299,000. The average days on the market for a luxury home is currently 84 days. Additionally, there is an average of 581 luxury home sales and 43 luxury homes that have sold this year alone. The sales ratio is 7 percent on average per year. These numbers and ratios will change in 2019 as the market fluctuates.
Is it time to buy? What is the future of the area market?
Yes. Now is the time to buy. In fact, it’s the best time to buy a luxury home in Central Florida. Buying before the end of the year will be the most opportune time before the real estate market shifts in other areas of Florida and outside of the state, which is predicted to happen in the next two years. Central Florida will feel the effects through a migration of affluent buyers, both on a national and international level, set on opportunism and a luxury lifestyle. It will then become a seller’s market, giving buyers less room to negotiate a good purchase on a luxury home. Trends are showing that Central Florida is seeing a migration from areas in Florida from other states and countries. The market is beginning to stabilize, but with interest rates on a slight rise in home purchasing, money becomes tight and less accessible. U.S. tariffs imposed on foreign countries, plus new trade agreements, are also affecting the foreign real estate market.
A great forecast.
The economic forecast for Central Florida shows continued future growth. We see expansions due to new home construction, theme parks, bourgeoning infrastructure and new businesses escalating into the area. It’s time to buy, whether you purchase a luxury home or not. While Central Florida is rapidly growing, local leaders have shared concerns regarding the lack of affordable housing. A decrease in construction of new luxury homes is also cause for concern. The inventory level for luxury homes will be low, with a migration of affluent buyers creating a seller’s luxury home market in the future. If you buy before the shift, your luxury home value and investment will increase – and that is a smart investment.
Guy Sanchez Jr. is the Vice President Managing Broker with Watson Realty Corp. He has over 28 years in the real estate industry with experience in the luxury real estate market in South Florida, Central Florida and the Caribbean. He also serves on the Florida Real Estate Commission (FREC).