With sales pace evening out month-to-month, inventory leveling off closer to two-months of supply compared to .6 months at the start of 2022, more properties are available which is softening the trajectory of price escalation, and days on market is increasing – it’s definitely not the go-go-go days of 2021 in the Sarasota Real Estate Market!
The good news is that our market’s shifting conditions are creating healthier and more resilient long-term sustainability. What is causing the shift? Here are just a few of the elements:
- Homeowners locked into 2-3% mortgage rates are resisting putting properties on the market if they would have to double their interest rates. (Note: in late September interest rates reached 6.7%, compared to an average of 2.96% through all of 2021.)
- Fewer feel a need to rush into relocation or new property purchases as seen in 2020-21, which was a result of the pandemic panic.
- Today’s buyers are seeking “move-in” ready properties, and sellers are still living in the 2020-21 world of expecting anxious buyers to overlook much-needed repairs.
- Would-be sellers enjoyed a few years of exceptional equity gains and prefer to park those profits during the current economic volatility.
- Some who have experienced significant dips in their stock-market portfolios are waiting to determine what their needs are in a selling price, or how their purchase budget may change as the market adjusts in the months ahead.
- Home builders report easing the pace of construction as sales in that segment have also quieted some.
In the luxury market, which is where most of my transactions occur, many, if not most of my clients are seeking or selling second homes. The buyers I am working with are laser-focused on their requisites and willing to wait for what they want. I also expect to see buyers in our market in the months ahead who will be seeking prime properties to park their money in during an anticipated fluid economy.
For luxury second-home sellers, most purchased their homes with cash and have more discretion on when to sell and at what price – it’s an appreciating asset and they can usually hold on to it indefinitely. In a recent AP article, data revealed that there was a 25% increase in second-home transactions in Q2 2022, and an astounding 200+% increase since Q1 2020! Those buyers are not likely to rush to sell. Inventory of luxury properties has remained essentially unchanged for the last three months, and I don’t see that shifting much through the end of year.
Real estate markets are clearly not immune to economic and geopolitical pressures, as we have learned from decades of peaks and valleys. I am not at all concerned that the Sarasota Real Estate Market is at risk of seeing measurable price declines or a rush of inventory coming online. It is important to note that the available properties for sale were under 1-month supply for 14 consecutive months, which put us dangerously out of balance. Moving towards 2-months now, and hopefully growing closer to 4 months of supply is a healthy position for our region as we enter our peak selling season in early 2023.
Despite still rising median and average sale prices year-over-year, prices are no longer climbing at a rapid pace month-to-month. In fact, in August prices declined slightly from the previous month. Among the most desirable markets, Sarasota is still considered a “value pocket”. Our region offers an enviable lifestyle at a good price, and luxury tier buyers are drawn with the expectation they are making a good investment.
To buy or sell in today’s fluid real estate market, you need to engage a realtor who has critical knowledge and rich experience in the local market. While we have not seen conditions quite like this before, working with a professional like me with more than 40 years of effectively guiding buyers and sellers through several uncharacteristic markets will be key to meeting your unique transaction desires.
This market may be different, but with my analytical approach, understanding of the realities, ability to evaluate client expectations, and expert management in negotiating the purchase or sale of a home or condo, I ensure that your goals are achieved.
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 so that when it’s the right time to list your property, or if a perfect opportunity comes along to buy your dream home, you will be first to know!
And now for my statistical report on the August Sarasota Real Estate Market activity:
- Total market dollar volume in August was $604.7 million which decreased by $5.2 million from a year ago.
- Broken down, single-family sales were $458.2 million and condo sales were $146.5 million for the month.
- The number of properties sold in August was 974, 182 less than a year ago. The sales total includes 678 houses and 296 condos. The monthly average of sold properties this year is 1,148. The monthly average was 1,369 last year and 1,179 in 2020.
- Florida’s single-family sales decreased 15.8% from last year, and condo sales were down 20.3% from last year.
- U.S. sales of single-family homes declined 19.2% and condos were down 24.6%.
- Of the closed sales in August, 91 were for over $1,000,000, 71 were houses and 20 were condominiums (virtually equal to last year). In 2021 Sarasota averaged 128 sales per month over a $1 million.
- In August, Florida’s homes sold for more than $1 million were up 2.4% and condos were down by 21.9% compared to last year.
- In August, 983 listings went to a pending contract, a decrease of 143 transactions from a year ago, but up almost 7% compared to prior month. Year to date there have been 1,132 pending sales per month. For 2021 the monthly average for pending sales was 1,122 and in 2020 it was 1,264.
- Florida’s single-family pending sales declined 20.2% and condos fell 20.3% compared to last year.
- U.S. pending sales in August were 24.2% behind a year ago.
- In Sarasota, single-family homes were sold at a median price of $475,250. The 2021 monthly median price for houses sold was $394,000.
- In August, Florida median price for single-family homes was $407,000, a 15% increase over last year.
- The national median price for existing homes grew 7.5% to $396,300.
- The condo median sale price was $375,000. The 2021 monthly median price was $317,000.
- Median price for a Florida condo was $305,000, a 20.8% increase over August 2021.
- U.S. median condo price grew 7.8% to $333,700.
- Sarasota houses sold on average for $675,808 for the month compared to August 2021 at $555,508. The year-to-date monthly average is $685,417 where the 2021 monthly average was $573,000 and in 2020 it was $321,000.
- Condos sold for an average price of $494,796 last month, compared to last year’s $461,046. The year-to-date monthly average is $558,975 and condo monthly average sale price in 2021 was $527,000 and in 2020 it was $382,000.
- Currently there are 2,165 properties for sale in Sarasota. There were 829 listings at the end of 2021, 2,272 at the end of 2020, 4,086 at the end of 2019 and 5,401 at the end of 2018.
- Of the available inventory for sale, 441 properties are listed for over $1 million. Of the active listings over $1,000,000, 325 are houses and 116 are condos.
- Inventory of properties in this price tier are nearly double what they were last year at this same time.
- Single-family homes had 22.6% more new listings, and condos trading for more than $1 million saw a 58.6% increase.
- The Sarasota market had 1,180 new listings in August. The market averaged 1,321 new listings monthly in 2021.
- In August, most new home listings were in the $600-999,999 price point.
- Most new condo listings were in the $400-599,999 price tier.
- Current inventory results in 2 months of single-family homes for sale in Sarasota and 1.6 month’s supply of condominiums.
- Florida currently has 2.4 months of single-family inventory and 2.2 month’s supply of condominiums. Inventory of properties selling for over $1 million have increased more than 50% over last year.
- U.S. inventory of existing single-family homes and condos has grown to 3.2 months of supply.