Sarasota, FL Real Estate Market was Jumpin’ in January 2018
The Moulton Sarasota Real Estate Report – January 2018
Sarasota Real Estate Market was Jumpin’ in January!
While the rest of the country saw fewer sales in January, moderate price escalation and not much movement in inventory, The Sarasota Real Estate Market was jumping with activity. A very active December that had strong pending contracts ready in the hopper, resulted in another positive month for our region with total sales rising more than 18% from last January. The U.S. on the other hand saw the largest dip in sales, 4.8% compared to prior year, in more than three years according to the National Association of Realtors.
The Sarasota Real Estate Market once again also recorded a more than 12% increase in pending contracts signed in January compared to prior year, compared to a statewide increase of only 2%. Nationally, pending sales experienced a considerable drop of 3.8% compared to January 2017. Market experts believe the decline may have been related to severe cold in northern markets last month.
As my subscribers know, monitoring pending contracts is one of the best ways to forecast sales in the month or two ahead. There has been a great deal of product under construction, especially in the Sarasota city core, so I believe the upward trend will continue for several more months before tapering off. And based on my own buyer activity, I am confident these new offerings in the Sarasota Real Estate Market will have plenty of qualified purchasers to absorb the new inventory.
Home builder confidence remains very high in the Sarasota Real Estate Market and nationally. With substantial new building activity, it is expected that sales nationally will begin to return to a growth pattern. In fact, 2017’s new home permits in the U.S. increased 9.7% over 2016, Florida’s new single-family home permits grew 12.9%, and the Sarasota County Economic Report indicated that in 2017 building permits increased 23%.
Inventory in the Sarasota Real Estate Market and across the U.S. remains tight in the lower price points, which is affecting overall growth in sales. However, in the upper and luxury price ranges – above $600,000 – inventory is stable with new listings in premier locations and in excellent condition coming to market at a steady pace this season. With active buyers in the marketplace seeking luxury and ultra-luxury properties (above $1 million), where most of my transactions occur, business is strong and we are beginning to see shortening of list to sale periods, narrower negotiations on price and more showing activity on prime properties.
The Sarasota Real Estate Market continues to have a large number of transactions closed without a mortgage. Compared to national all-cash sales of 22% of total, our region hit 50% in January. Most of this is at the luxury end of the market where buyers have seen considerable growth in personal wealth in both home equity and stock and bond market gains, providing them the advantage of being able to move to closing on their prized property more quickly.
Following are local, regional and national statistics for January 2018:
- Total Sarasota Real Estate Market dollar volume of $347.6 million in January increased $71.5 million from prior year and increased $48.9 million over the prior month of December 2017. This Increase is mainly attributable to significant new condominium construction completions and closings in January.
- Broken down, single-family dollar volume increased 13% compared to prior year and condo sales dollar volume was up 64% mainly due to the closings of sales of the new condominium projects.
- The number of properties sold in January including both single family and condominiums was 855 which was 121 less than December and 133 more than a year ago, representing a 18% overall growth in number of closings in the month over last January.
- Florida’s single-family sales decreased 1.3% and condo sales grew 5.9% over prior year.
- U.S. single-family sales decreased 4.8% and condo sales fell 4.6%.
- The 2017 monthly average of total sales was 978 and in 2016 the monthly average was 952.
- The majority of my sales occur in the $1 million and above category, so I watch this tier closely. Of the total closed sales in Sarasota last month 57 were for over $1,000,000 or 9%, 22 were houses and 35 were condominiums.
- Florida’s $1 million sales were 3.5% of total sales.
- Sales of over $1 million nationally represented only 2.5% of the market.
- All cash sales in Sarasota continue to be strong with 43% of single-family and 60% of condo sales closed without a mortgage. By comparison, national all cash transactions were 22% of total sales.
- Total pending sales of 1,243 properties that went under contract during January increased by 135 from the same month last year, a 12% increase, with homes showing a 4.7% increase and condominiums up a remarkable 27% from prior year.
- U.S. pended sales for all housing types fell by 3.8% compared to prior year.
- Florida’s total pending sales grew just 2% higher over last year.
- The monthly average of new pending sales in the Sarasota Real Estate Market in 2017 was 1,043 vs. 1,005 in 2016.
- In January, Sarasota’s single-family homes were sold at a median price of $275,900 vs. $250,000 a year ago, 10.6% higher.
- The 2017 monthly median price average for houses sold in Sarasota was $267,043 and $249,943 in 2016.
- Florida median price for single-family homes was $240,000, a 9% increase over last year.
- The national median price for existing homes grew by 5.7% to $241,700.
- Condominium median sale price was $238,000 in January vs. $239,900 in January 2017.
- The 2017 monthly condominium median average is $225,585 vs. $208,539 in 2016.
- Median price for a Florida condo last month was $179,900 an 11.7% increase over January 2016.
- U.S. median condo price grew 7.1% in January to $231,600.
- The average sale price for houses in Sarasota was $365,593 in January vs. $352,507 a year ago.
- The past year’s monthly average price for houses sold was $370,708 vs. $346,232 in 2016.
- Sarasota’s condominiums sold for an average price in January of $484,342 vs. $321,329 a year ago.
- The 2017 monthly average price for sold condominiums is $362,378 vs. $325,802 in 2016.
- Single-family homes sold at 95% of list price, and condominiums sold at 96.3% of the list price. The 2017 average for all properties sold was 95.6% of list price at the time of contract vs. the original list price.
- Total available inventory in the Sarasota Real Estate Market has increased by 401 listed properties from December, but has 246 less properties than in January 2017.
- Currently there is available inventory of 4,802 properties for sale, there were 4,401 at the end of 2017, 4,595 at the end of 2016 and 3,598 at the end of 2015.
- The Realtor Association of Sarasota-Manatee reports that there are 4.5 months of single-family homes inventory and 5.5 month’s supply of condominiums, both under the 6-month level considered a balanced market.
- Florida currently has 3.9 months of single-family inventory and 5.9 months of condominiums.
- U.S. inventory of all housing types is reported to be at 3.4 months.
- Sarasota County had 1,790 new listed properties in January and averaged 1,147 new listings per month in 2017 and in 2016 it was 1,005.
- Of the total new listings the past month 144 properties or 8% were listed over $1,000,000.
- 456 or 25% of the new listings the past month were listed for between $400,000 and $600,000.
- 1,190 or 67% of the month’s new listings were listed for under $400,000.
A recent report from The Conference Board stated that consumer confidence in February was the highest that it has been since February 2000. Despite the recent fluctuations in the stock market, Americans believe the strong jobs market and encouraging business climate will allow their personal wealth to grow this year.
With January’s 30-year conventional fixed rate mortgage rate of 4.03%, mortgage rates are still at historically low levels and many buyers continue to take advantage of the favorable conditions. Though rate increases are expected in 2018, economists are projecting only a modest increase of up to 5% by year-end. For comparison’s sake, mortgage rates have been above 5% for 38 of the last 46 years.
The Sarasota Real Estate Market has a nearly balanced market favoring neither a buyers or sellers, high-quality new homes and condominiums are being completed and available for occupancy, attractive and well located existing inventory is coming to market, there is strong household equity growth and moderate increases in interest rates, there is room to increase sales and median prices and inventory to continue the sustained growth that our market has seen these last few years.
Based on my reading of the Sarasota Real Estate Market conditions, as well as the general confidence of U.S. consumers, I continue to believe that the region will maintain its positive momentum and activity will be “jumpin’” for the months ahead.
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