Sarasota Real Estate Market activity continued its growth in May, with sales, prices and pending sales increasing at a consistent pace. Existing single-family and condominium inventory for sale remains slight and demand does not appear to be easing, contrary to the traditionally late spring slowing seen in previous cycles.
While all price tiers are seeing similar activity, this month I narrowed my focus on the Sarasota Luxury Real Estate Market – the million-dollar and above category, where most of my transactions occur. Past years have shown that this segment of the market has much greater list-to-sale periods and wider gaps in list-to-sale prices, though trends have altered as is shown in the attached charts.
Over this last year, the number of days on market for properties listed over $1 million has fallen more than 40%. And because the number of days a property is listed has narrowed so much, most listings don’t experience periodic price reductions, resulting in a measurably improved sold to original list price ratio.
This tier of the market typically sees sale prices hovering in the range of 85% of original list price, however over these last few months this has grown to 97% at its highest in March, and 96% in April and May.
New listings of luxury properties have grown over prior year, however the pace is nearly equal to new pending sales and also closings each month, so as long as the demand remains stable, the seller’s market conditions will persist.
Also contributing to the supply and demand issue is the slowdown of construction of new luxury homes and condominiums in 2020. Add with current rising costs and delays in delivery of materials, it does not appear that new product will help to ease the inventory concerns in the near future.
What seems to be driving this supply decline? The data that I analyze reveals that it is not just the affluent buying additional properties, it appears more likely that seniors, baby-boomers and empty nesters decided to stay in place this last year rather than executing plans to relocate, upsize or downsize during the pandemic.
Also contributing to the soaring demand is the rise in wealth of the affluent buyers. The strength of the stock market, increased values of primary residences, and reduction in personal spending on indulgences such as travel and luxury goods are enabling buyers to purchase higher priced properties.
Sarasota’s median sale price for properties over $1 million was $1,600,000 in May. By comparison, our nearest geographic competitor for affluent buyers is Naples, which had a median sale price of $3,725,000, and on the east coast the Palm Beach area saw median sales hit $4,699,000.
Cash transactions are key in today’s market. Sellers are less interested in mortgage contingencies when offers are coming in. To be competitive in the luxury market, buyers for the most part are extremely savvy and prepared to move their resources swiftly. All cash transactions in the $1 million+ tier were 50% of those closed in May. In May 2020, all cash sales were 35%.
As you consider your real estate goals for the year ahead, whether buying or selling, having a professional with a critical and analytical approach, an understanding of the realities, and able to set expectations based on pragmatic and practiced conclusions will ensure your goals are achieved.
With decades of experience managing hundreds of transactions, and experiencing the Sarasota Real Estate Market’s variability, my knowledge throughout the region can help. Whether looking to relocate to a new neighborhood, considering upsizing or downsizing, or adding to your real estate portfolio, I would be happy to discuss your next steps with you.
And now for my statistical report on the May 2021 Sarasota Real Estate Market activity:
Sales
- Total market dollar volume in May was $900.3 million which increased by $446.7 million or approximately 50% from a year ago.
- Broken down, single-family sales were $584.9 million and condo sales were $315.4 million for the month.
- The volume in single-family was up $247.2 million from last year while condo volume was up $199.5 million.
- The number of properties sold in May was 1,526, 424 more than a year ago. The sales total includes 985 houses and 541 condos. The monthly sold properties average was 1,179 in 2020 and 1,074 in 2019.
- Florida’s single-family sales increased 57.9% from last year, and condo sales were more than 155% higher than last year.
- U.S. existing single-family sales rose 39.2% and condos were up 100%.
- Of the closed sales in May 161 were for over $1,000,000, 105 were houses and 56 were condominiums.
- In 2020 Sarasota averaged 50 house sales and 23 condo sales per month over a $1 million, which was a small portion of our overall sales.
- Last month 1,448 listings went pending, 18.5% higher than transactions in May 2020. For 2020 the monthly average for pending sales was 1,264, compared to 2021 monthly average of 1,668.
- Florida’s single-family pending sales just .1% and condos rose 56.7% compared to last year.
- At the time of publishing this report, U.S. pending sales for May had not been released.
Prices
- Single-family homes were sold at a median price of $407,00. This is the first time in local history that the median price crossed $400,000. The 2020 monthly median price for houses sold was $321,000.
- In May, Florida median price for single-family homes was $344,900, a 27.7% increase over last year.
- The national median price for existing homes grew 24.4% to $356,600. The U.S. housing market has now recorded 111 consecutive months of price gains.
- The Sarasota condo median sale price was $312,500 in May. The 2020 monthly median price was $255,000.
- Median price for a Florida condo in May was $250,000, a 24.1% increase over May 2020.
- U.S. median condo price grew 21.5% to $306,000.
- Sarasota houses sold on average for $593,764 where the 2020 monthly average was $455,000.
- Condos sold for an average price of $582,924 last month. The condo monthly average sale price in 2020 was $382,000.
Inventory
- Currently there are 944 properties for sale in Sarasota. This is a decrease of 131 listings from the month before. There were 2,272 at the end of 2020, 4,086 listings at the end of 2019 and 5,401 listings at the end of 2018. This explains the market heavily favoring sellers.
- Of the available inventory for sale, 248 properties are listed for over $1 million. Of the active listings over $1,000,000, 165 are houses and 83 are condos.
- The Sarasota market had 1,384 new listings in May. The market averaged 1,040 new listings in 2019. Of the new listings the past month 144 properties were listed over $1,000,000.
- Current inventory results in 0.7 months of single-family homes for sale in Sarasota and 0.7 month’s supply of condominiums.
- Florida currently has 1.1 months of single-family inventory and 2 month’s supply of condominiums. Inventory of properties selling for over $1 million has decreased more than 40% compared last year.
- Total U.S. listings of existing single-family homes and condos has decreased more than 20% since last year leaving just 2.5 months of inventory available for sale.
