Is Orlando a Good Place to Invest in Real Estate?

Orlando, Florida, is a prominent urban center known for its dynamic environment and significant attractions. For those exploring real estate investment, understanding the underlying economic conditions and specific market characteristics is fundamental. This article covers Orlando’s economic framework, market dynamics, property types, and financial considerations relevant to real estate investment.

Orlando’s Economic Landscape and Growth Indicators

Orlando’s economy is characterized by consistent growth, driven by a diverse set of industries and a steadily expanding population. The metropolitan statistical area (MSA) experienced a population increase of 2.7% in 2024, adding approximately 76,000 new residents between July 2023 and July 2024. This growth rate surpasses Florida’s overall rate and ranks as the highest among the 30 most populous regions in the United States. International migration has been a significant contributor to this demographic shift, accounting for nearly 65% of the region’s population gain since 2020.

The influx of new residents underscores a robust job market, supported by major sectors such as tourism, technology, healthcare, and education. While tourism remains a foundational economic pillar, the expansion of technology and healthcare industries contributes to a more diversified employment base. This diversification helps foster economic stability and creates demand for housing and related services.

Orlando’s economic health is also influenced by ongoing development projects that support its growing population and commercial activity. These projects aim to enhance infrastructure and urban amenities, which can further attract businesses and residents. A growing workforce and increased consumer base bolster the demand for both residential and commercial properties.

Real Estate Market Dynamics

The real estate market in Orlando exhibits specific characteristics influenced by its economic growth and population trends. In July 2025, the median home sale price in Orlando was approximately $434,000, reflecting a 4.8% increase compared to the previous year. Another report indicated a median listing home price of $398,800 in July 2025, with a median sold price of $400,000.

Homes in Orlando remained on the market for about 52 days in July 2025, which is longer than the 29 days observed in the prior year. The market is considered balanced, indicating that the supply of available homes is relatively in line with buyer demand.

The inventory of homes for sale in Orlando stood at approximately 4,874 in July 2025. New construction efforts continue to address the housing needs of the expanding population. The rental market experiences consistent tenant demand due to the continuous influx of residents and the city’s appeal as a destination.

Investment Property Types and Considerations

Orlando offers a range of property types for real estate investment, each with distinct characteristics. Residential properties, including single-family homes, multi-family units, and condominiums, represent common investment avenues. Single-family homes often appeal to long-term renters and families, providing potential for steady rental income and property appreciation. Multi-family units, such as duplexes or small apartment buildings, can offer multiple income streams from a single property. Condominiums, particularly in urban or amenity-rich areas, can attract individuals seeking convenient living with shared facilities.

Beyond traditional residential options, short-term vacation rentals are a notable property type in Orlando, given its status as a global tourism hub. Operating short-term rentals, defined as less than 30 days, involves specific regulatory compliance. Hosts must register with the City of Orlando, with an initial registration fee of $275 for the first year, decreasing to $125 for subsequent years. These rentals are subject to occupancy limits, typically allowing a maximum of two guests per bedroom plus two additional guests, up to a total of four people, and are limited to one booking at a time.

Specific zoning regulations apply; properties in purely residential areas may not permit short-term rentals unless zoned for commercial or mixed-use. For “home share” rentals, the owner or a long-term tenant must reside on-site for at least 51% of the year. Investors in short-term rentals are also required to collect and remit specific taxes, including Florida Sales Tax (6%), an Orange County surtax (0.5%), and an Orange County Tourist Development Tax (6%), totaling 12.5% of the booking amount. A state license from the Florida Department of Business and Professional Regulation (DBPR) is also necessary for rentals under 30 days, costing around $170 annually for a single unit.

Financial Aspects of Real Estate Ownership

Property taxes constitute a significant annual expenditure, calculated by multiplying the property’s assessed value, after any exemptions, by the applicable millage rate. The City of Orlando’s millage rate for 2025 is 6.6500, though the total tax rate includes levies from Orange County, public schools, and other special districts. The median effective property tax rate in Orlando is approximately 1.19%, resulting in a median annual tax bill of around $3,073. Florida residents using a property as their primary residence may qualify for a homestead exemption, which can reduce the assessed value by up to $50,000 for tax calculation purposes.

Insurance costs represent a substantial financial consideration, especially in Florida. Average annual homeowner’s insurance in inland cities like Orlando can be around $3,000 for $300,000 in dwelling coverage. For investment properties, landlord insurance averages between $2,288 and $2,860 annually. Flood insurance is often a separate requirement, particularly in high-risk zones, with average annual costs through the National Flood Insurance Program (NFIP) ranging from $792 to $878. Premiums for flood insurance can vary significantly, from $610 in low-risk areas to $2,412 in high-risk zones.

Homeowners Association (HOA) fees are common in many planned communities and condominiums in Orlando. These fees can range from $300 to $450 per month, with an average of around $467 per month in 2025, driven partly by rising insurance costs. HOA fees typically cover the maintenance of common areas, landscaping, and amenities. Property management fees, if an investor opts for professional management, generally range from 8% to 12% of the gross monthly rent for residential properties. For vacation rentals, these fees can be higher, potentially ranging from 20% to 40% of the rental income. Additional expenses include tenant placement fees, which can equal a full month’s rent, and ongoing maintenance costs for the property.