Posted in Central Florida Market | Posted on 02-20-2014 | Written by Metrostudy News
(Orlando, FL – February 20, 2014) New housing production in the Orlando area slowed in the 4th quarter, but remains strong as sales backlogs still exist at virtually all production builders. This is according to a recent report by Metrostudy, a national housing data and consulting firm that maintains the most extensive primary database on residential construction in the US housing market.
In the Orlando MSA (Lake, Orange, Osceola, and Seminole counties), 1,806 single-family housing units were started in 4Q13. This represents an increase of 5.2% compared to the quarterly starts rate of 1,716 units in 4Q12. Single-family quarterly closings totaled 1,863 units, which is 10.0% higher than the 1,694 closings that occurred in the same quarter last year. “Starts and closings in the Orlando MSA were down this quarter from the third quarter, but still up from a year ago. The slowdown this quarter can be attributed in large part to seasonality, as most builders are still reporting significant sales backlogs,” said Anthony Crocco, Regional Director of the Metrostudy’s Orlando Market
Total single-family inventory, which is comprised of units under construction, finished vacant units and models, equaled 4,791 units at the end of the fourth quarter, representing 7.5 months of supply. Housing inventory increased by 32.1% compared to last year. “The number of units in housing inventory was virtually unchanged from last quarter, with a few more houses finished and vacant this quarter than last. Still, most completed houses are being occupied very soon after completion,” said Crocco.
This quarter, 2,036 lots were delivered to the Orlando MSA versus 1,713 lots a year ago. Vacant developed lot inventory stands at 26,871 lots, a decrease of 10.4% compared to 29,997 lots last year. Based upon the annual starts rate, this lot inventory represents 36.3 months-of-supply, a decrease of 19.7 months from last year. “Vacant lot inventory ratios have been generally declining, but rose a bit in 4Q13. The annual starts rate also rose only slightly, which has left the months of supply level unchanged from last quarter. While there are still over 3 years of lots remaining in the MSA, key submarkets are in need of additional lots,” said Crocco.
“We expect growth in new home construction activity to slow in the best locations, as pricing increases and lack of lot availability will impact demand and supply there. Builders are beginning to reach out with more conviction into the “C” and even “D” locations in order to find lots with pricing that will enable home sales to first time and first time move–up homebuyers. This trend is only going to accelerate as infill pricing increases at a faster rate than the overall market,” said Crocco.
Metrostudy is the leading provider of primary and secondary market information to the housing and related industries nationwide. Metrostudy provides research, data, analytics and consulting services to help builders, developers, lenders, suppliers, retailers, utilities and others make investment and business decisions every day. For more information, visit www.metrostudy.com
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