Though it comes as no surprise for those of us working in the Sarasota Real Estate Market, according to just released data, April 2015 was another month of sizzling activity. As predicted after robust contract signing activity in February and March, real estate closings in April were very impressive.
We usually expect temps to start to rise in April and the real estate market begin its cooling as it enters the “shoulder season.” However, in addition to April recording some of the highest daily average temperatures on record, the Sarasota Real Estate Market remained “peak-season” HOT!
- HOT sales – Total sales in Sarasota during the month of April were the highest recorded in history!
- HOT contract signings – Pending sales grew 8% over April 2014.
- HOT price growth – Median prices for properties closed in April rose impressively for both single-family homes and condominiums.
With additional price movement upwards, but at a moderated pace, and all other Sarasota Real Estate Market indices continuing their positive growth, it appears we are on pace for a healthy summer.
For those of us whose business tends to be in the $1 million and above category, recent reports of Sarasota-Manatee recording the highest percentage of all-cash sales in the country is not unexpected. Between the international market believing that investing in luxury properties is a “safe place” to park their cash, to boomers and soon-to-be retirees making property investment a key to their long-term financial strategies, along with Sarasota’s overall health and quality of life, and expectation for continued growth, we seem to be well positioned for more strong monthly results throughout our softer “shoulder” and summer seasons ahead and more all-cash transactions.
I watch a variety of Sarasota Real Estate Market key market indicators, and some of those that are most meaningful in projecting the region’s future prognoses are below.
April Market Data
As noted previously, Sarasota real estate continued to be HOT into a month that normally sees some softening. In last month’s report I indicated that impressive pending sales recorded were likely to result in a potential for another strong month. In April 2014 we celebrated that the region recorded its 2nd highest number of sales in history…this year we surpassed even that!
- Total sales in April in the Sarasota Real Estate Market increased 2.4% from April 2014, the highest monthly sales amount ever, surpassing the previous high in April 2004 by a narrow margin of just a single sale. April sales were also 2% higher than last month.
- Nationally sales fell 3.3% from prior month but grew 6.1% from prior year.
- Florida sales were strong, recording a nearly 15% increase over last year.
- Distressed sales (short sales and bank owned) as a percentage of total sales have continued to fall. In April those sales were 15.6% of total sales in Sarasota, considerably below the 50% mark at the bottom of our housing market. Most of the sales of distressed properties are in price points below $500,000.
Last month I reported that pending sales during the month were strong, so it wasn’t a significant surprise that April property sales hit record highs. What we didn’t necessarily expect was that the April contracts would continue at such a robust pace. A strong tourist market certainly helps, as does returning equity to prospective buyer portfolios, but Sarasota also continues to be known as a great value for real estate when compared to our geographic competitors.
- Sarasota Real Estate properties that went under contract in April were 8% higher than last year, and according to Trendgraphix were the highest in the 15 years of records I reviewed.
- National pending sales in April hit a 9-year high, 14% ahead of prior year and 3.4% higher than March 2015.
One of the most important signs of stability in the Sarasota Real Estate Market is a consistent pattern of growth in median prices. Median prices have grown 33% since the low in 2009, but are still 32% below the peak values recorded in 2006.
- Prices for Sarasota Real Estate transactions closed in April rose over the prior year.
- Median price for single-family homes was $221,900, an increase of 13.1% over a year ago.
- Condominium median prices were $196,250, an increase of 4.3% over a year ago.
- The average sale price for houses In Sarasota was $320,842 in April, and they were sold at 94.3% of the list price.
- With condominiums, the average sale price was $287,026 and sold at 93.9% of list price.
- The median sale price for all sales in the US in April increased almost 9% from prior year.
- Florida’s median prices increased by 11% over April 2014.
We had been hopeful that as home equity within the Sarasota Real Estate Market improved, sellers previously hesitant to list their properties waiting for the market peak would put their properties on the market. However, the pace of demand and sales is still exceeding the number of listings coming into inventory. 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 from home builders.
- Inventory in April fell 6% from month-end March, and that is after an 11% drop in inventory month-to-month in March.
- Total inventory in the area is currently at a 4.2 month supply, well below a balanced market, which is defined by a 6-month supply of inventory.
- Properties under $500,000 have just 3.1 month’s supply.
- In the category $500,000 – $1 million, inventory is 11.2 months.
- For properties over $1 million, there is a 17-month supply.
- The distressed inventory is only 6% of the total available inventory, compared to 17% last year and 50% in 2011.
- The national distressed inventory percentage of total sales was 10% last month.
Inventory is a key catalyst within the Sarasota Real Estate Market, as is our ever-growing population. As long as prospective sellers remain on the sidelines, prices will escalate and make it even more difficult for those hesitant sellers to make their next purchase. If you are one of these, I say procrastination is not a good strategy! The typical reasons for delaying listing a property are waiting for the kids to move out (and how long might that be?), a future retirement (partial/full/when?), major repairs that might be needed (might it just not be better to let someone else make those?), not ready to sort through all the “stuff” that has collected, have had previous bad experiences with a relocation or move, expectations of a significant rise in the home’s value, and many other similar excuses. While each may be absolutely valid for any seller, the cost of housing is not going to go down anytime soon.
In fact, industry analysts believe that in the next 5 years we will see a cumulative 16-19% growth in prices in our region. And just this week experts have said that with continued tight inventory, rising prices with sales closer to list price, and shortened list to sale periods, the tide has turned and that the real estate market has moved into a – sellers’ market. Waiting for your stars to align perfectly so that the move to your next property or relocation is “perfect” is simply unrealistic, and, as I said, not a good financial strategy. Demand in the Sarasota Real Estate Market will remain strong, and if you don’t make your decision to move on soon, might you miss your ideal next new home?
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 Realtor Association of Sarasota and Manatee 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 April 2015