The data from the Orlando Regional Realtor Association shows that average home prices dropped 8% from July to a low of $99,900 in August and sales prices were down 22% from last year.
It means that for the first time in more than a decade, the average price of a home in Orlando has dropped to less than $100,000 (£63,933).
Orlando-based British Homes Group, a company set up by British people for Brits considering buying property in Florida, say that many savvy investors are snapping up these bargain properties.
The last time existing houses were so cheap in Orlando was in May 1998, when a mid-range home cost $98,984. In comparison, only three years ago average prices peaked at $264,436 (£168,966).
The real estate industry blames the price drop on the end of the federal homebuyer tax credit and the fact that more than 70% of August sales were of distressed properties. In August, only 28% of sales were ‘normal’ sales of properties not in financial trouble, and the remaining 72% were either bank owned properties or short sales – when a house sells for less than the mortgage owed on it.
‘People want to buy something for $65,000 (£41,429) and, you know what, I can find it. And that’s scary. I wouldn’t live in any of it, but you can find it all over,’ said one local Florida agent from Re/Max Select.
Sales volumes also dropped in August. Local agents closed 2,429 sales, down 3% from the previous month. Ironically the drop in prices and sales came at a time when interest rates actually became slightly more attractive to buyers, dropping from 4.67% in July to 4.61% in August.
However, The Orlando Regional Realtor Association believes that there are signs that the market is stabilizing. For example, the difference between sales and asking prices narrowed slightly from 94.44% in July to 95.04% in August and the inventory of houses listed for sale for over 6.5 months increased only slightly from July to August.
The British Homes Group said there are numerous bargain properties. An example is five bedroom, three bathroom, 2,000 square foot home with private pool on a residential community close to Disney for just $149,000 (£94,940) that had a previous price tag of over $350,000 (£222,964).
‘We have an increasing number of Brits requesting bargain priced holiday homes in Florida. There’s now no need for Brits to buy one of the well publicised re-possessed properties, which may not be in a good state of repair, when they can buy a new property for the same price or less,’ said Lee Weaver of the British Homes Group.
‘Mortgages are available for British and other international buyers with a 30% down payment. Some of our customers are actually flying over from the UK, and even as far as Africa, to review these incredible property bargains,’ he added.
