Moulton Sarasota Real Estate Report – March 2013
Real Estate Market Shows Broad Signs of Sustainable Rebound
The March real estate market reports have been released and, it is no surprise that sales, median price and pending sales all grew yet again. The Sarasota area was a buzz of activity, mostly driven by our treasured tourists, with many here hunting for a new home, condo or land to develop for a future move. Transactions from investors seeking some good bargains in the distressed market also contributed to the market’s improvement. There is no doubt that we have enjoyed a super spring!
Sarasota sales for March rose yet again, adding another nearly 7% on top of a 24% increase in February and we still have another full month of peak season ahead of us! If we remain at the same pace we have been experiencing for the last few months, it is likely this selling season will set records. Our first-quarter 2013 Sarasota real estate market transactions are more than 11% higher than last year.
Inventory once again shows our major market weakness in its drop of more than 18% from last year, with single-family falling 9% and condominium inventory dropping 13%. Last months’ data showed that available listings in Sarasota have decreased 11% from January 1, 2013 and 21% from the same time last year. Facing considerably less than six months of supply now and likely through the end of the year, our continued gains in sales could be tempered, though the lack of supply will help us to continue to grow prices.
Last month Sarasota median sales price exceeded last year by almost 19%, an extremely powerful signal of a recovering market. Single family home median price is now hitting $210,000 and condo prices have reached a median of $182,000. Based on sales in March, my research shows that our region has just over 3.5 months of supply right now, the lowest we have seen in 10 years. A more finite look at the various price points reveals that in the under $500,000 market inventory is just 2.7 months, in the mid-market segment of $500,000-$1 million the supply is at 6.5 months, and at the luxury level above $1 million available inventory is sitting at 16 months, a far cry from the 26 months in that segment last year. In four years, inventory has dropped from over 9,500 available properties to only 3,250 today. Tight supply and prices still considered “affordable” are stoking demand and helping to nudge prices higher. Though still a far cry from the peak market pricing in 2005 and 2006, we are moving up at a measured pace that bodes well for a healthier market revival.
The Florida Association of Realtors reported last week that this is the 14th month in a row that median prices have been up year-over-year. Nationally, February median prices rose 11.6% over last year with a 12-month consecutive climb and the strongest since November 2005. Despite the tight supply, national sales bested last year by more than 10%, the 20th successive month of increased sales.
Giving us continued confidence that our Spring 2013 selling season will finish strong, pending sales were extremely strong at month-end. The Sarasota Association of Realtors claims that pending sales last month were the highest in the past seven years and possibly the highest in the region’s history. A stunning increase of 31% year-over-year for single-family properties under contract but not yet closed in the month of March is a convincing statistic to confirm a healthy season. Statewide, last month’s pending sales saw an improvement of 28% from prior year.
On the national front, recent news of revised forecasts being released by the market experts and economists was good news. Bank of America has moved its expectations boldly from its original prediction of an increase of home prices expected this year to be 4.7% over last year to a new forecast of an 8% rise in prices. A reduced population of underwater home owners is helping, along with continued low mortgage rates and a positive outlook from the construction industry are all contributing factors in the revised outlook.
Zillow surveyed more than 100 leading economists, and though the average expectations from this large group weren’t quite as extraordinary as BofA’s, the results showed that these market experts believe that 2013 will see a price increase of an average of 4.6%, and over the next five years a 22% rise. Zillow’s chief economist is quoted as saying, “The panel is quite bullish on home prices…expectations are consistent with continued strong home value growth fueled by tighter-than-normal inventory of for-sale homes and robust demand attributable to high affordability and a stronger general economy.”
Home builder confidence is exceptionally strong and their increasing activity is responding to new home buyer pent-up demand. Unfortunately, material shortages and unavailability of skilled labor are causing challenges in the pace of completions. Some reports indicate that the time to finish homes is being extended by as much as 20% while builders wait for lumber and specialty laborers. The New York Times reported last week that it has not been since the 1980′s when we were recovering from a double-dip recession that housing starts have risen so dramatically year-over-year. National new home permits rose almost 34% and new home starts were up just under 47% compared to last year. In Sarasota total permits issued in March 2013 were more than 96% higher than last year, with the value of the new construction showing nearly 40% higher than a year ago. This progress in new building gives hope to easing the real estate industry’s inventory strain, as well as helping to heal our regional employment and retail industries.
Overall, the housing market is consistently showing further signs of strength, whether we look at our hyper-local market or nationally. With continued increases in sales, prices, pending sales, and new home starts, we will be seeing a narrowing of time on the market for new listings. Given the strong projections from the economic experts, now is an excellent time to add your property to the listing books. I would be delighted to help you to decide what is best for your property, both from a listing timing and price setting strategy. Give me a call if you are considering a sale of one of your properties or in the market to buy an investment property or a new home, and I will be happy to offer my best advice for your individual situation. I am confident that our progressive momentum will continue and, whether you are in the market to buy or sell, this is a uniquely advantageous time to be in the real estate market.
The following statistical data is provided through the Sarasota Association of Realtors by agents within our local board. The table summarizes what happened in each price segment. The Sold, Pending Sale and Listed columns are sales and new listings for the month of the report, and the Pending Total and Listed Total are the current totals of each. YTD (Year to Date).
SARASOTA MARKET REVIEW MARCH 2013
NEW Luxury Beach Front Condominium on Longboat Key
With just 10 miles of beach front on Longboat Key, it is rare that a brand new project is built. Let me introduce you to one of the first to be developed in seven years!
Infinity Longboat Key will have just 11 residences made up of nine three- and four-bedroom condominiums and two spectacular nearly 5,500 square foot penthouses. All of these distinctive residences have expansive terraces of 1,202 – 1,940 square feet with summer kitchens offering breathtaking views of both the Gulf and Sarasota Bay.
The project, designed by celebrated Sarasota architect Mark Sultana of DSDG Architects has been defined as being in the style of Coastal Contemporary and will be built to the very latest coastal construction codes including floor-to-ceiling impact glass windows in all units offering spectacular lights and endless sight lines across the beach and bay, and will also incorporate the latest energy efficiencies.
Luxurious finishes will be used in the residences including Italian cabinetry in the kitchen and baths, Wolf and Sub Zero appliances, gracious en suite master and guest bedrooms and large open living spaces. Each unit is also afforded a private two-car garage with storage, and an exclusive elevator for ease of access and privacy. Early buyers have the opportunity to work directly with Mark Sultana to custom design their interior space. Penthouse buyers have the ability to fully customize their homes with Sultana.
To complete this impressive project, resort amentities such as a beachfront pool and spa, fitness center, tennis court and club house will be available on site.
The developer is now accepting reservations with a $25,000 fully refundable deposit for the A or B plans (see below and attached) and a $50,000 deposit for penthouses. The reservation period is anticipated to last 90-120 days with contract conversion immediately following. Construction is expected to take 12 months.
The extraordinary beach front luxury Longboat Key residences are priced from $2,825,000.
Please contact me for more information or to schedule an appointment with me to learn more about this exciting new Longboat Key condominium project.
Click on the image below to view larger scale floor plans, site plan and reservation/purchase details.
Real Estate and Lifestyles in Southwest Florida – SaundersBEST Magazine
Just this week Michael Saunders and Company announced its premier issue of SaundersBEST Magazine. This glossy new publication is filled with highlights of some of the region’s most extraordinary residences for sale, as well as a wonderful guide to the many special attributes of our exceptional region. Each issue is promised to offer a sampling of the Michael Saunders and Company listings from Manatee, Sarasota and Charlotte Counties. For a full view of all of the company’s listings head to www.MichaelSaunders.com.
In Michael Saunders’ statement about the new venture she says, “More than just a portfolio of the region’s most outstanding homes and condominiums, the magazine provides a glimpse into the legendary coastal lifestyle that has been our region’s most attractive calling card for so many years.”
The electronic version of this beautiful new magazine can be viewed here SaundersBEST Magazine or feel free to email or call me and I will send a print copy to you.
West of Trail – Sarasota’s Highly Desired Area Sees New Development
Introducing Granada Park
A new community called Granada Park, made up of Craftsman styled homes and all certified “green” construction is underway! Rarely do we see a whole new “neighborhood” emerge in Sarasota’s west of trail and east of Sarasota Bay area. Long considered one of the most sought-after locations to buy a home in Sarasota, and with Siesta Key’s powder-white just a short drive, the shops and dining at Southside Village and Southgate Mall just down the road, Sarasota Memorial Hospital just blocks away and one of Sarasota’s most acclaimed elementary schools, Southside Elementary within minutes, and myriad of Sarasota’s cultural, entertainment and arts facilities so close, it is no wonder!
Granada Park’s developer has created a charming enclave and intends to build on the eclectic charm of the area and offer four distinctive designs to choose from using top-of-the-line materials throughout. As noted by Michael Saunders in her recent promotion of Granada Park, which our company is the exclusive marketing and sales broker for, the following are just a few of the features that we believes make this so special:
- Three bedroom homes start from just $599,000 and four bedroom residences up to $850,000.
- Flexible/Customizable Floor Plans (4 Home Models Available)
- Sizes range from 2,132 square feet to 2.796 square feet (under air)
- Master bedrooms on the main living level
- Large elevated decks
- High Impact Windows- Lots of Natural Light
- Community Pool
- Gated neighborhood
- Low Homeowner Association Fees
There are just 16 homesites left! I encourage you to give me a call to schedule an appointment to learn more about this wonderful new development.
The elegant Granada Park homes have caught the attention of the market and with their with exquisite attention to detail, exceptional craftsmanship, unmatched energy efficiency, and designed to the latest construction codes, they are sure to go fast. With features, finishes and a location like this, you’d expect to pay much more than the offered home and site packages starting at $599,000.
Read more about Granada Park in Michael Saunders’ recent blog post http://www.thesaundersblog.com/new-market-new-choices/ and call me to see for yourself this highly-anticipated new offering in Sarasota’s West of Trail scene.
A REAL Revival in the Sarasota Real Estate Market
With the results of the last 10 months of 2012 tallied, the year’s home sales, prices, inventory levels and new home building activity have exceeded even some of the most optimistic projections made by housing industry experts and Wall Street economists months ago. Based on trends and current pending sales, analysts are forecasting another 7% increase in prices this month compared to November 2011, and by year-end inventories are expected to be in excess of 20% lower than last year.
The recent reports from the National Association of Realtors showed that last month’s sales of existing homes were up 11% over last year and new home sales jumped 17%. Overall sales have climbed more than 45% since June 2010.
The National Homebuilders Association’s recent survey of its members showed continued improvement in homebuilder confidence and the highest in the last six years. Last month homebuilders nationally broke ground on new homes at the fastest pace in four years, and the Census Bureau issued a report saying that housing starts have increased 41% since last year! Total construction spending is reported to have risen 55% since the bottom of the market in mid-2009.
In the Sarasota metro area, the real estate market has continued to be robust and there is no question that it will continue through the end of the year, as is evidenced in the increase in pending sales of 33% compared to last year. Pending sales, properties that are under contract but will typically close within one or two months, is an excellent performance measure to note. With the obvious demand for Sarasota real estate from local, national and international buyers, a severely contracted supply of properties available, and new homes entering the marketplace at too slow a pace to meet buyer demand, prices are inching higher. So far prices in our local Sarasota region have risen in every month of 2012. The news of rising prices is encouraging buyers to come off the sidelines and sellers to be more confident that they can sell at a good price.
Tom Heatherman of Michael Saunders & Company wrote in his blog this week, “With a strong year behind us and Southwest Florida’s busiest home buying season ahead, if your goal is to sell your home in 2013, now is the time to list it.” The article is attached HERE and includes a great deal of relevant data revealing why and how the Sarasota real estate market continues to outperform the nation.
Relief in the Upsurge of New Home Building
Included in my last several months of articles, blog posts and news flashes forwarded to my subscribers, the subject of available inventory of homes in the Sarasota real estate market has been front and center. There had also been a few references to the positive, yet cautious optimism from home builders.
This week’s announcements from National Home Builders, HUD and the Department of Commerce broadcasting the exceptionally positive news of new home sales reaching a two-year high, and up more than 20% over the same month last year, is encouraging on so many fronts. U.S. building permits also saw a great deal of activity, up 29.5% over July 2011 and reaching a pace not seen since 2008.
From the home builder confidence that properties they have been sitting on for several years waiting for demand to return so they can again get back to the business of constructing, to the great effect the trend will have on the jobs market (the builders’ association estimates that each new home built creates an average of three new jobs for a year,) enthusiasm for new development in the Sarasota real estate market is deserved, and most of all welcome.
Qualified buyers are able to not only take advantage of historically low interest rates but, with the cost of building supplies and labor still relatively low, buyers interested in considering building a custom new home have a great opportunity right now. The challenge we still face, however, is that with the pace of sales of new homes is greater than the number of new home starts, and our inventory drain is not being resolved.
Attached is an article that Michael Saunders posted this week on the same subject, titled Building New.
In addition to the terrific selection of vacant properties throughout the Sarasota market, I have several listings of spectacular sites and would be delighted to show these or any others that may meet your special needs and desires. Whether your preference is for direct waterfront, canal lots, garden locations or ranchette and estate properties, Sarasota offers many choices for every Florida lifestyle and budget.
Michael’s Vacant Waterfront Property Listings
Sarasota’s Hottest Real Estate Topic – Inventory
There has not been a media report on the real estate market for some time that hasn’t mentioned “inventory” as a critical issue. Listed homes in the Sarasota region have dropped by more 25% in this last year. Levels of available properties are nearing a point similar to the height of the boom in 2005 and are 70% less than five years ago.
The market change is made even more remarkable in that there is still minimal new building taking place, the expected effects of the “glut” of distressed properties that were supposed to upend the market have not occurred, and traffic from interested buyers is higher than we recall it being for quite a while, especially for this time of year.
Sarasota County now has just a 4.1-month supply of properties for sale according to Trendgraphix (report attached HERE). This indicates that we have fallen below the level market analysts consider a “balanced” market – meaning neither favoring buyers or sellers, suggesting that pressure on prices is underway and we should begin to see them inching up. At the end of the market in which the largest share of my business takes place, the $1 million and over range, the available inventory has fallen to one of the lowest marks since 2002.
The Sarasota area continues to be high on the list of places in the U.S. attracting international buyers, and given foreign spending on property tends to be nearly double that of a typical American, our area seems to be at a critical period where we have extraordinary opportunity but little to offer. We are at the height of the year when we welcome our global visitors and I am hopeful that as the inquiries come in, we have some new properties coming online to show. The National Association of Realtors reported that more than $82 million was spent by foreigners on properties last year, a 24% increase in just one year, and almost 9% of all sales in the U.S.
Sarasota’s wealth of cultural, recreation, dining and shopping, along with our spectacular setting, exceptional housing values and welcoming residents make our region the ideal choice for the transnationals. The majority of our European buyers, an incredible two-thirds, are paying cash for their properties, something that puts them in an even more powerful position in negotiating a purchase.
Along with the May Trendgraphix report, I have also attached a recent posting by Michael Saunders highlighting why our firm offers the greatest possible opportunity to market properties to the robust international market. In addition to closing more than twice the number of Sarasota real estate transactions compared to our company’s regional competitors, the firm offers partnerships and relationships with the world’s finest agents in 52 countries, giving our clients the greatest marketing visibility.
So if there ever was a time to bring your property onto the listed property rolls, it would be now. Reduced days on market, sale prices and list price gaps narrowing, and Sarasota area average sale prices inching upwards are all signs of a stabilized and improving market. I encourage you to take advantage of my proprietary “Comparative Market Analysis” – a free assessment of your property’s value. Now might not be the exact time you planned to make a move from your current residence to a new property or sell an investment home but, having a strategy in place for the time when you are ready is a solid asset management tool.
Sarasota Real Estate – Anything but Humdrum
Just when you thought “season” was over in Sarasota, signs of a continued active real estate market are announced! The late spring/early summer is normally a relatively neutral period for Sarasota real estate however, this year is appearing to look anything but humdrum. The Sarasota Association of Realtors (SAR) along with the National Association (NAR) and several other analytical sources have just released the latest statistics on our “micro” market as well as on a broader scale, and there is little news of anything dispiriting.
On a national basis it is reported that homes are selling 20% faster than last year, and sellers are getting contracts signed at prices closer to their listing price than has been seen for many years. Curtailed home building over the last five years has clearly contributed to the inventory drain and resulted in a 15th consecutive month of year-over-year decreases in properties for sale across the nation. In Florida, the number of homes for sale has dropped a remarkable 34% from last year and currently sits at just a 5.5 month supply. The good news is that homebuilders’ confidence is rising and strong applications for building permits are being seen here and around the country. Permits issued in the southern region of the US were up 11.1% in May, a notable indicator from our builders of a commitment to bring new product to the marketplace.
May home sales, as referred to earlier, contributed to yet more momentum in our recovery. Nationally, home sales were up 9.6% over last year and prices continued their climb with an 8% increase. In Florida, prices experienced a 9% lift over last year. Pending home sales once again hit enormous numbers with Florida contracts in the works recorded at a 43% increase in single family homes and 33% more for townhomes and condos.
The luxury market is seeing some strong interest locally, regionally and around the country with some record-setting super-luxury properties changing hands and noticeable increased activity in the $1 million and over category. US home sales over $1 million rose 24% in May over last year and that follows a year-over-year increase in April of another 13.4%. The world’s wealthy see value in the Sarasota and other most desirable real estate markets and buyers want to strike before values begin to rise in earnest.
Until we see more inventory, sales will not reach their full potential, prices will continue advancing upward and listing-to-sale periods will compress. Hence the new “four-letter mantra” our firm is embracing – LIST! If there was ever a time to consider getting your property on the market, now is ideal for those looking to move a slightly underwater property, anyone planning to down- or up-size, investors considering second homes, or early retirees looking to take advantage of great prices here in preparation for a move in the next few years.
Sarasota Real Estate Prices Swell
There is no shortage of news of the continuing real estate market recovery around the country. In Florida, one of the most talked about trends is the rising prices of properties. Recent record breaking listings offer some excitement but, most important is the sustained month-over-month and year-over-year increases in nearly every price category.
The attached article in the Sarasota Herald Tribune quotes the largest broker in the Sarasota region, Michael Saunders, as saying “I call it the ‘big thaw,’ and it’s resulting in more activity than we’ve seen since 2005.” With annual numbers of closings and total closed dollars reaching volumes not seen in many years, it is difficult not to feel confident that the recovery is underway, and appears to be sustainable based on expert data and analysis of relevant statistics and historical evidence.
A Market Expert Talks About Trends
In a recent special section the Sarasota Herald Tribune, columnist Chris Angermann interviewed me about how I see our housing market evolution. The article is attached in its entirety below.
As I have reported previously, with the peak selling season behind us we are cautious as we enter the shoulder/summer to not over-speculate that growth will remain at the same pace as we recently experienced however, I am confident that recovery will continue. One of the nuances of the Sarasota real estate market that my peers and I have had these past several months is that a great number of the buyers are new to Sarasota. Many are pre-retirement and still holding onto primary residents elsewhere but, they see incredible value and low interest rates creating a sense of urgency for them to buy here now before the opportunity is lost.
With an estimated 10,000 baby boomers reaching age 65 EVERY DAY for the next 20 years, the supply of potential buyers for Sarasota real estate almost seems endless. It’s no surprise to all of us already here that the region offers spectacular opportunities to enjoy an active lifestyle filled with performing arts, visual arts, one of the country’s greatest collections of dining establishments, myriad outdoor activities, incredible shopping and so much more – add to that our great prices, decent existing inventory and record new housing starts, I see no problem attracting our fair share of those aging adults and our region once again returning to a robust housing economy.
The Economic Development Corporation of Sarasota, Manatee’s partner organization, the many regional Chambers of Commerce and the other active groups are working diligently to attract new business and industry to the area, which will continue to reinforce our jobs market. The announcement of several business expansions and new industry moving here provides excellent prospects to “young” retirees looking for new professional opportunities. Maybe we’ll even become more successful in retaining more of our young home-grown talent, see them enjoy the opportunity to have fulfilling careers, raise their families here and invest in homes, helping to further contribute to a sustainable and strong Sarasota housing and overall economy!
“A Market Expert Talks About Trends”
Published: Saturday, June 2, 2012 Sarasota Herald Tribune Guide to the Real Estate Marketplace
A Realtor with Michael Saunders & Co. since 1982, Michael Moulton deals with luxury waterfront real estate. In the past decade, he has been involved in transactions exceeding $300 million. A student of the market, he keeps a close eye on trends and has earned the designation of Certified Residential Specialist (CRS), which is held by less than 4 percent of all Realtors, and also holds the Graduate, Realtors Institute (GRI) diploma from the National Association of Realtors. Correspondent Chris Angermann interviewed him in his Longboat Key office.
Q: What’s different about the real estate market than a year ago?
A: The activity we’re seeing is that the buyers are people that sold their property elsewhere — whether it it’s their main residence, because they want to retire here, or a vacation home … they don’t go to anymore. That wasn’t the case before.
Another dynamic we’ve seen in the last year or so: People who are looking around real estate here and say, “I can’t buy until I sell my current house,” perhaps seeing something they really like and may go home and take a lower price they otherwise would not have taken. They want to buy now when they think is a good value. I have done transactions with several people who are several years away from retirement but are taking advantage of the lower property values and low interest rates.
We certainly have what is considered a normal market — six months of inventory at most prices. The ratio of inventory to closed monthly sales is down from that, so you’re probably going to see a slight price increase of properties, say of under a half-million dollars.
Q: What about the luxury market?
A: For residences over $1 million, we probably have a couple of years of inventory. But the well-priced, remodeled or fairly new homes are the first ones to go, and people are finding it harder to get what they want with the bells and whistles they want, so we’re seeing the start of new construction again. The infill lots west of the Trail — Southside Village near the hospital — look at the construction that’s going on there.
Bird Key, where I live, is a perfect example — if there is so much great inventory out there, why is there so much construction going on? In several cases, it’s people moving up from an older residence to a newly built home. The prices for bayfront lots have gone down, as have construction costs, although they’re going up again.
Developers are starting to talk there again, too. There are some well-heeled people that have been sitting on land for a while, who feel that Sarasota may be right for some new high-end, high-rise condos downtown and on the islands. There are a certain number of buyers who want to live in something that never has been occupied, preferably a condominium as close as possible to their primary home — private garage, private foyer, spacious, three bedrooms — plus a home office, if they can have it.
Q: Who are these buyers?
A: Many come from Chicago and New York. But this past season there have also been a tremendous number from Canada, mainly Toronto. Their economy must be booming, because it seems like every other showing I have is to a Canadian.
The European business, while its part of our livelihood, is not big by comparison. The statistics are that the typical foreign purchases are around $300,000 — and a lot of those happen in the Orlando area. We also don’t have Far Easterners, Middle Easterners or Brazilians in the luxury market — the people that are buying art work, fancy wines and Bentleys. I don’t see them coming here. An occasional family at IMG, but that’s usually just temporary while their kids are in school there.
But if you’re a baby boomer who’s considering moving to Florida, Sarasota has to be on your radar screen as a place to check out. People are coming here now who don’t have a prior family connection — they just want to see it.
Several of my clients rented for a season before they decided to buy. There are so many baby boomers coming, we’re going to get our fair share.
Q: So the prognosis is good?
A: It all adds up to good news. I find that wherever I go, whether it’s golfing or to restaurants, everybody seems to have a sense that things are coming back. Just the fact that things are selling gives everyone a good feeling.