The Moulton Sarasota Real Estate Report – March 2015
Strong Performance Generates Confidence
As the Sarasota Real Estate Market nears the end of its peak selling season, it is hard not to be confident in our region’s vitality. Our area has been buoyed by a record tourist season, equity recovery by households that held onto assets during the market downturn, consumer confidence in our driver markets, and pent-up demand.
Market fundamentals such as sales growth, median price increases, tight inventories, and competitive real estate lending are all fueling a sense of strength and stability. With many of the markets that are feeding buyers into Sarasota experiencing median prices 3-4 times as high, and average square foot costs in excess of twice that of Sarasota, we continue to considered “reasonable” value. One of our closest competitors for out-of-state buyers is Naples, where price per square foot costs are reported to be 25% higher than Sarasota.
The peak selling season in regions of the country that the Sarasota Real Estate Market appeals to is just now starting. It is my opinion that as those property sales heat up, we will see demand in this area as sellers are freed up to search for second homes or relocations, creating potential for an extended selling season in Sarasota. In fact, early data reported by Trengraphix indicates that closed and pended properties reported so far for April are trending ahead of last year, further supporting the notion of a continued rise of sales ahead of last year’s record season.
Recent surveys of potential real estate buyers in the U.S. revealed that Americans believe residential real estate is considered the “safest” investment. Homebuilder sentiment this last month continued to indicate confidence in the continued strong demand for new homes, but that cost and availability of labor, and potential rising building supply costs may force constrained growth for months to come.
Inventories of properties available in the Sarasota Real Estate Market took another dip in March, leaving a deficit of 1.5-2.5 months of supply (depending on which statistical analysis you review) between the theoretical balanced market of six-months and current availability of units for sale.
Below is Sarasota Real Estate Market data that I believe supports why I have confidence that the strong performance that we have been experiencing will continue:
March Market Data
First quarter 2015 sales are pacing 7% ahead of the same quarter 2014. At the bottom of the market in 2008, sales were 50% less than this quarter. At the height of the market run-up in 2005, 1st quarter sales were 13% less than our current results. Adding the Trendgraphix data showing an increase in April’s closed and pended contracts, it is clear that this year is off to a strong start.
- Total sales in March in the Sarasota Real Estate Market increased 14.3% from March 2014.
- Single-family homes rose 13% over last year and condos rose 17%.
- March sales were an impressive 43% greater than last month’s total transactions.
- The closed sales the past month is very close to the all-time high of 1,228 sales in April 2004.
- The pace of sales nationally was also strong, reported to be 10.4% ahead of previous year and 6% above last month, and the highest rate of sales in 18 months.
- Florida sales increased 17.4% over previous year.
- The Sarasota Real Estate Market’s all-cash transactions consistently exceed average around the country.
- In Sarasota, March’s cash sales were 56% of all transactions.
- By comparison, the national percentage of all cash sales was just 24%.
- Distressed sales (short sales and bank owned) as a percentage of total sales have continued to fall. In March those sales were 17% of total sales in Sarasota, considerably below the 50% mark at the bottom of our housing market.
- Nationally, the percentage of distressed sales was 10%, compared to 14% in March 2014.
According to Trendgraphix, pending contracts signed in March were strong, far exceeding last year. The Sarasota Association of Realtors has adjusted their data tracking and reported in their month-end release that pending sales in March were close to even with previous year. Whichever report is used, because year-to-date sales are already ahead of last year’s, I am optimistic that the trend will continue.
One of the most important signs of stability in the Sarasota Real Estate Market is a consistent pattern of growth in median prices.
- Prices for Sarasota Real Estate transactions closed in March rose 8% over prior year.
- The median price for single family homes is $207,500, an increase of 9.5% over a year ago.
- Condominiums median price was $180,745, an increase of 5.8% over a year ago.
- The average sale price for houses In Sarasota was $303,270 in March, and they were sold at 94% of the list price.
- With condominiums, the average sale price was $258,921 and sold at 93.5% of list price.
- The median sale price for properties across the US in March was $212,000, which was 7.8% higher than last year.
- In the case of national sales, median prices for single family homes were 8.7% higher than previous year, and condominiums increased by 1.6%.
- The state of Florida is also seeing consistently increasing median prices. In fact, the state recorded its 40th month in a row of year-over-year price increases.
- Florida’s median single family home prices were $190,000 last month, and condominiums were $152,000, both increasing approximately 9% from previous year.
As home equity within the Sarasota Real Estate Market improves, and sellers previously hesitant to list their properties waiting for the market peak, we have been hopeful that those home sellers who had been sitting on the sidelines would put their properties on the market. However, strong sales are consuming far more properties than the pace of new listings. In fact, inventory in March fell 11% from month-end February. Sarasota continues to suffer from too few properties to meet demand, and despite the sense of booming construction activity in the region, the new homes market is not yet great enough to offset the many years of inactivity and deficiency of existing homes coming on the market.
- Total inventory in the area is currently at a 4.6 month supply
- Properties under $500,000 have just 3.7 month’s supply.
- In the category $500,000 – $1 million, inventory is 11 months.
- For properties over $1 million, there is a 20-month supply.
- Statewide inventory is reported to be about 5.5 months, and the national inventory level is 4.6 months of supply.
- New listings in the Sarasota Real Estate Market have increased over the past few months, though the inventory has still decreased 8% from a year ago, and as previously mentioned, is 11% below last month.
Though our traditional spring break visitors from around the U.S. have returned to their home states, the next few months are some of our strongest for international visitors. These global buyers bring the advantage of their typically shorter timespan to make a buying decision and more all cash transactions allowing for swifter closing periods. Being an associate of Michael Saunders & Co. provides one of the largest distribution networks to qualified real estate professionals and consumers around the world through our various affiliations, including Christies International, Leading Real Estate Companies of the World, Mayfair International Realty and Luxury Portfolio.
If you have been pondering over when the right time to list your property is, there has not been a stable cycle like we are experiencing now in many years. In the last year more than 12,100 properties sold…that’s more than 33 sales per day! With sales volume continuing to climb, inventory remaining limited and demand for our region hot, I believe that now is an extraordinary time to get into the game. I would be happy to review your potential listing and offer an analysis of the market conditions along with your individual needs, to help you determine with confidence what your best outcome can be if you choose to sell.
On the other hand, if you are a buyer, I ask…why wait? Prices are expected to continue to climb, list to sale price ratios as well as number of days on market have narrowed considerably, proving that sellers are “right-pricing” their properties. Let me know what your needs and vision are and we can work together to find your ideal property before someone else acquires it!
Whether a buyer or seller, my more than 30 years in the Sarasota Real Estate Market brings an advantage of a depth of knowledge of the many special communities in and around Sarasota, market trends, and even planned transformations that could affect housing. As a seasoned real estate professional, I will work with you to identify your short- and long-term interests, and will help you to achieve your individual objectives. Please call if now is your time to buy or sell a property! It would be my distinct honor to assist you, family, friends or acquaintances with their next Sarasota Real Estate transaction!
The following statistical data is provided through the Sarasota Association of Realtors for properties throughout Sarasota County. The table summarizes what happened in each price segment. The Sold, Pending 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 at the report’s month end.
SARASOTA COUNTY MARKET REVIEW MARCH 2015