The Moulton Sarasota Real Estate Report – June 2016
Summer Activity – Steady as She Goes!
As I was reading through some of the data being reported from June’s Real Estate Market activity, I was sitting on my condominium terrace and happened to glance out at the sparkling Sarasota Bay, just as a beautiful sailboat was passing under the stunning Ringling Causeway lit brightly with the morning sun. The sight of the smooth sailing yacht struck me as the perfect metaphor for the Sarasota Real Estate Market.
June 2016 felt very much like May 2016…and April 2016. The number of sales of single-family homes rose slightly from last month, but were below the same months last year. June condominium sales increased over last year and last month. Once again, the region saw increased listings, and median prices continue to rise. Yes, Steady as She Goes! It is said that this maritime instruction from a captain to a helmsman is to stay on course, no matter the gusts of wind or cross-currents.
Despite so many global disturbances, economic troubles in some of our key international feeder markets, and many Americans sense of uncertainty regarding the future political direction our country may go, the Real Estate activity in our area remains stable.
It’s not to say that there aren’t some effects of the external forces. However, our strong local economy, constant inflow of newly retired or nearly retired, as well as growth of existing and new businesses in the region that are attracting young professionals, and incomparable quality of life including the cultural offerings, fine dining and recreation all seem to be keeping our Sarasota Real Estate Market on a steady course.
Sales
Numbers of sales in the Sarasota Real Estate Market once again showed a modest decline in single-family transactions compared to prior year, and condominiums sold at a slightly higher pace. If you remove the diminishing effects of distressed properties on the market and only look at “traditional” sales, single-family homes improved 4.7% and condominiums 8% over prior year. With the number of new home sales ever-increasing, which are not tracked in the statistics available for review, it is my opinion that the robust number of new properties entering the marketplace is contributing to the appearance of an easing sales pace. While data to track our regional new homes market is not available, a recent report from the US Census Bureau and HUD indicated that new home sales across the country rose 25.4% last month compared to June 2015, likely a good indication of our own area’s activity.
- Sarasota is averaging monthly sales $351.7 million for the first half of 2016. June saw nearly $400,000 in transactions, 5% more than June 2015.
- Single-family sales last month were down 4.7% from prior year, but 5.2% more than May 2016.
- Condominium sales were just under 1% higher than last year and about 5% less than May.
- U.S. real estate sales increased 3% in June.
- Florida’s housing transactions saw single-family home sales almost equal to last year and condo sales fell 2.6% compared to last year
- All cash sales in Sarasota continue to be strong with 37% of single-family and 62% of condos sales closed without a mortgage. These numbers represent one of the highest rates of cash transactions in the country in our sized region. By comparison, the national average of cash transactions was 22% of all sales.
- Distressed sales were only 6.3% of total sales, compared to 13.4% last year.
Prices
If you missed the recent blog post from Michael Saunders & Company, “3 Ways Price Can Make or Break Your Property Sale”, I urge you to give it a read. One the most discussed items when preparing a property for sale is, no surprise, what price to list it for. Setting the selling price is not magic or impulse – it is a science. Only an experienced realtor knows how to establish appropriate comparables, studies the surrounding neighborhoods, and knows which of your unique selling points – as well as the potential shortcomings – will affect a buyer’s perception of the price-to-value. I have a saying that I share with my listing clients – “Are you listing your property to sell, or are you pricing it to live in it?”
- In June, Sarasota’s single-family homes were sold at a median price of $248,000 vs. $230,000 a year ago, an increase of nearly 8%.
- Condominium median sale price grew to $219,000, an increase of 4.3% over June 2015.
- Florida median price for a single-family home is reported to be up 10.8% over last year, to $225,000, and condo median prices increased 8.6% to $164,000.
- Nationally, median prices for all homes rose 4.8%.
- The average sale price for houses in Sarasota was $334,061 in June vs. $326,134 a year ago, a 2.5% increase.
- Sarasota homes sold at 95% of the list price.
- Sarasota’s condominiums sold for an average price of $377,746 vs. $306,589 a year ago, a 23% increase.
Inventory
While additional inventory within the Sarasota Real Estate Market continues to flow online, we still find ourselves below the traditional “balanced” market, which is considered 6-months of inventory. This would indicate that we are still in a seller’s market, but we are continuing to inch toward that 6-month marker, which generally results in a slow-down of price escalation and longer list-to-sale periods for sellers.
- Total available inventory in the Sarasota Real Estate Market has increased by 510 properties or 13% since the beginning of this year.
- For single-family homes inventory has grown 20% and condos 36% over the past 12 months.
- Compared to June 2015, in the price range of $250,000 to $600,000, where the majority of sales occur in our market, single-family home the inventory increased 75% and condo inventory rose 64%.
- In the luxury market (over $1 million) where most of my transactions take place, there are 51% more condos available for sale and 10% more single-family homes to choose from.
- The Realtor Association of Sarasota-Manatee Total reports that there are just 3.7 months of supply of condos and 3.5 months of single-family homes in inventory, well shy of a balanced market, which is defined by a 6-month supply of inventory, indicating the Sarasota Real Estate Market is still considered a “seller’s market.”
- Sarasota is averaging 1,372 new listings per month this year and currently shows available inventory of 4,407 properties for sale.
It is hard to believe that it was almost exactly 10 years ago that we hit the peak of our market. We weathered the many years of the downturn and have experienced consistent recovery and growth over the last four years. The home buyer pool will increase exponentially over the next 18 months as the “rebound buyers” – those that lost their homes during the recession – complete the mandatory waiting periods and rebuild their credit eligibility. Interest rates are expected to remain low, new home building is brisk, and the many market trends that I watch are showing no evidence of irregularity or frenetic activity. As I see it, The Sarasota Real Estate Market is positioned well to stay the course.
Now that we have passed the half-way mark for 2016, is it time to revisit your home buying or home selling goals for this year? As inventory continues to rise, there is more selection to choose from –during these next few months before the next tourist season arrives, buyers have a chance to seize on the wider options. And with 30-year conventional fixed rate mortgages priced at the lowest rate in three years, why wait?
At the same time, if you are a would-be seller, rising inventories may create competition, which could create a longer selling time, as well as result in slower escalation of prices – waiting may not allow you to move on to your next purchase as quickly as you might like.
Whether a buyer or a seller, the Sarasota Real Estate Market is emanating data that reflects a very steady market – this is a moment that is ripe for both sides of the table.
