Rising Housing Costs vs. Stagnant Incomes - What will come of it? (Miami: transplants, apartment complexes)

[Spring Hillian]

Originally Posted by bmw335xi

Still, Orlando's homeownership rate is the same to slightly better than the national average. When you look at areas with high incomes, we are much better than them.

According to the Orlando Sentinel reports :
"Metro Orlando's homeownership rate dropped by more than that of all but three markets in the U.S. from 2010 to 2013, according to a study released Thursday by the National Association of Realtors.
Homeownership has been in a state of decline nationally, with a 1.8 percent drop during the three-year period. But Orlando's decline of 4.27 percent more than doubled the U.S. average.
"


I wonder how anyone an afford living in Orlando. I often read here that there are no jobs, low paying jobs or if a job becomes available 20 people apply for it.

[WithDisp]

Originally Posted by OTownKnight

I think builders and developers are certainly catching on to the strong demand and population growth, which will (and currently is) fueling supply to catch up to demand. Once they balance out hopefully the market will correct itself as this doesn't seem to be another bad-lending bubble (for now).

http://www.bizjournals.com/orlando/n...apartment.html

"New multifamily building highest level in 15 years."

Builders are building -apartments-, and not true multifamily housing.
Condos have been a decline since the 2008 crash.

Investors want maximum gains, and the city wants development. If the city refuses to curtail and keeps slotting projects to just apartment developers rather than long-term resident housing you don't necessarily satiate the demand.

Since the crash, investments in housing have skyrocketed in the United States, often by foreign owners.
It's understandably so. Though, in a society with through-the-roof disproportionate access to resources, a problem is posed when 100% of the country needs a roof over their head, and 10% of the country has more wealth than the other 90% combined.

Blackstone owns 50,000 houses. Many in Orlando.
The apartments coming up can survive years with few tenants because of large capital companies who will see their value back in the land alone.

I'm not preaching many solutions- but if the city residents were concerned enough (or informed enough) they'd let city council know that more condos would help alleviate transitory populations and overall help satiate demand. Investors won't see as high a return- but they can't be presented with a choice. It's more housing- or we move onto a company/builder who will work with us.

[bmw335xi]

I will repeat as some people have reading comprehension problems.

Orlando's homeownership rate is the same if not a tad bit better than the national average.

Talk to an English professor if that doesn't make sense to you. It's like arguing what area is the most expensive in Central Florida. Person A says Winter Park, Person B says Kissimmee because home prices increased the most percent... the bottom line is Winter Park is still more expensive than Kissimmee regardless that kissimmee prices went up more percent.

[WithDisp]

Originally Posted by bmw335xi

I will repeat as some people have reading comprehension problems.

Orlando's homeownership rate is the same if not a tad bit better than the national average.

Talk to an English professor if that doesn't make sense to you. It's like arguing what area is the most expensive in Central Florida. Person A says Winter Park, Person B says Kissimmee because home prices increased the most percent... the bottom line is Winter Park is still more expensive than Kissimmee regardless that kissimmee prices went up more percent.

... and the national homeownership rate has been dropping year after year.

and the rent burden in Orlando (because of low income workers) is quite higher than that national average. Wages are NOT increasing, and median rent is.

Hence, read... and read again, the title of the thread.

This isn't... is Orlando a good value for the money?
Is Orlando cheaper than San Francisco?
It's what will be the result of property value growth if incomes do not increase countywide.


Study says more than half of Orlando renters are 'rent-burdened' | News | Orlando Weekly

Housing Affordability Burden For U.S. Cities

Rents: South Florida rental households struggling, study shows - Sun Sentinel

[clearlevel]

Originally Posted by OTownKnight

Very true, and I didn't mean to come across as bashing Orlando because this problem certainly is not unique to Orlando. I just don't want the false narrative to spread that everywhere else is expensive while Orlando is still cheap. It's certainly no San Fran or New York and probably never will be, but it does have its own set of affordability issues.

I think builders and developers are certainly catching on to the strong demand and population growth, which will (and currently is) fueling supply to catch up to demand. Once they balance out hopefully the market will correct itself as this doesn't seem to be another bad-lending bubble (for now).

http://www.bizjournals.com/orlando/n...apartment.html

"New multifamily building highest level in 15 years."

There's not an affordability issue. Orlando homes are affordable to many people and the fact that home sales and new housing constructions are springing up everywhere is proof of that. They're being sold. I just saw a business lady come in and buy up a house cash for a million dollar home. I saw another pensioner buy a house cash. There are government workers, police officers, they all get lots of money. They can afford those houses in the swanky neighborhoods. Those are the people who live in the "nice areas." It's not McDonald's people, unless the McDonald's person saves up money for 20 years and then pools the money together.

I've met plenty of immigrants who work minimum wage and own homes. It's certainly possible to buy a home. You've got to be one stingy person.

There are still plenty of millionaires, pensioners and stingy people that are buying up the houses in Orlando. If houses weren't selling, the prices would be going down, but they're being sold. That means people think the houses are worth paying for.

Not only that, but even if houses were to drop 15% or more, would it really make that much of a difference? They can drop down to 2008 levels and you still need good credit and some savings. Home prices can only go so low. Have home prices ever been "affordable?" Homes have always been costly. Plus, why does it have to be a home? There are apartments and townhomes as well, and there are still plenty of cheap houses if you go to the rural areas.

The average $200,000. There are still homes for $50,000. There's even a house for $20,000 with no air conditioning in rural areas.

[boy3365]

Originally Posted by kyle19125

Rentals in Orlando rise as region near top in US for loss of homeowners - Orlando Sentinel

That article is approaching two years old and stops analyzing data at 2013. Are things about the same nowadays or has it gotten worse?

[bmw335xi]

The premise is people cannot afford to buy properties yet data doesn't show that and on a national level Orlando is on par with the country if not a tiny bit better.

[clearlevel]

Originally Posted by boy3365

That article is approaching two years old and stops analyzing data at 2013. Are things about the same nowadays or has it gotten worse?

I don't know about rentals. I mean, landlords can rent a property for however they want to. There's more leeway there. However, houses have definitely gone up since 2013, that's for sure. In 2013, houses were still cheap. Even up till 2015, although there was a steady rise, I would say there were still some cheap areas. However, in 2016? That's when houses started going up again.

[kyle19125]

Originally Posted by boy3365

That article is approaching two years old and stops analyzing data at 2013. Are things about the same nowadays or has it gotten worse?

Orlando's average rent has increased 4.76% in 2014, 2.1% in 2015, 8% in 2016 and started 2017 up 13% from January to February alone.

Meanwhile the median Per Capita Income is still stuck at 26K, up from 21K in 2000. A $5000 increase in 17 years clearly isn't keeping pace with inflation so while there is talk of the average wage improving, it's not overtaking inflation.

[BrokerHarry]

Contrary to many of the opinions expressed in this thread, Forbes Magazine recently listed Orlando as the #3 Best US City to Invest in Housing in 2017:

https://www.forbes.com/sites/samanth.../#58f30eda54c9