The Moulton Sarasota Real Estate Report – September 2018
Summer Sales Maintain Momentum
The Sarasota Real Estate Market turned in another month of increased sales and prices, inventory expansion and considerable growth over prior year in pending sales in the month of September. Remembering that September 2017 had a major disruption with Hurricane Irma tracking through the state, we expected improvement over prior year. What we saw was not an extreme expansion, but rather a modest lift in sales and prices, yet again setting our regional market on a steady and sustainable course as we move into our busier selling season.
Last year’s hurricane event caused a double-digit drop in contract signings, so not surprisingly that statistic in September 2018 grew to a pace that, as you’ll see in the statistics below, was substantial.
New construction remains robust and is helping to meet demand in that segment, however existing homes and condominiums are still showing slim inventory for buyers in the market for established neighborhoods and buildings. A six-month supply of properties for sale is considered a “normal” market, in which home prices would be expected to rise at the same pace as GDP. With our inventories well below that standard, the Sarasota Real Estate Market has and will continue to have prices grow at a greater pace in the months ahead.
National economists are confident that sales and price growth will continue through 2019, though at a slower rate than we experienced in 2018. The Sarasota Real Estate Market is expected to maintain its rate of growth that typically beats data reported across the rest of the country.
Buyers who are planning to use a mortgage have seen an increase in rates this year, as has been well reported. In the luxury market where most of my transactions take place, the majority are paid in cash. However, in the last few years with historically low interest rates many couldn’t help but take advantage of the cost of money.
Buyers in other price tiers may feel that borrowing below or near 5% is objectionable, but if you take a look at the chart here (provided by Keeping Current Matters using data from Freddie Mac,) you’ll see that though you may have missed the lowest mortgage rates in modern history, you’re still experiencing very favorable borrowing conditions. Add to the attractive rates the easing of banking regulations for borrowing, conditions are still good for buyers wanting to use a mortgage for their purchase.
The stream of international buyers, demand coming from states facing harsh tax environments, and the large number of baby-boomers beginning their search for retirement properties, all lead to confidence in the Sarasota Real Estate Market’s potential to keep expanding. Based on my own buyer traffic and recent number of clients looking to list their properties, I am convinced that our peak selling season ahead will maintain the momentum that we have seen throughout 2018.
Many of my subscribers are outside the Sarasota area. With decades of experience assisting clients from across North America, I have developed a great network of some of the best realtors. Let me know if you’re contemplating selling and I’ll help you find a professional to work with in your community.
And now for my report on September Sarasota Real Estate Market activity:
- Total Sarasota Real Estate Market dollar volume of $275.3 million in September increased by $12.7 million from the prior year.
- Broken down, single-family sales were $194.8 million and condominium sales were $80.5 million.
- The effects of Hurricane Irma on sales last year are remarkable when you see the year-over-year data for the entire state of Florida – single family sales volume grew 23.5% and condo volume was up 23.3%.
- The number of properties sold in September was 806 which was 37 more than a year ago. The sales total included 548 houses and 258 condos.
- Florida’s single-family sales increased 17% and condo sales were up 14.6% compared to prior year.
- U.S. single-family sales declined 4.0% and condo sales fell 5%.
- The 2018 monthly year-to-date average for sold properties in Sarasota County is 1,055 whereas the 2017 monthly average was 966, a nice average monthly increase.
- Of the closed sales in Sarasota last month 19 were for over $1,000,000, 4% of the total sales, 11 were houses and 8 were condominiums.
- All cash sales in Sarasota continue to be strong with 36% of single-family and 54% of condo sales closed without a mortgage. By comparison, national all cash transactions were about 20% of total sales.
- Listings that went pending the past month were 842 and increased by 205 transactions from the same month last year, with single-family growing 28.8% and condominiums up 17.8%.
- Florida’s single-family pending sales also showed an incredible increase over Hurricane Irma affected September 2017 with 37.9% more single-family homes and 44.1% more condo contracts written compared to last year.
- U.S. pending sales fell 1% compared to prior year.
- For the first nine months of 2018 Sarasota has averaged 1,108 pending sales. The monthly average of pending sales in 2017 was 1,043 and in 2016 it was 1,005. This trend is important to watch as it tends to forecast sales activity in the 30-90 days ahead.
- In September, Sarasota’s single-family homes were sold at a median price of $280,000. The 2017 monthly median price average for houses sold in Sarasota was $267,043, about a 5% increase.
- In September, Florida median price for single-family homes was $251,610, a 4.9% increase over last year.
- The national median price for existing homes grew by 4.6% to $266,500.
- The condominium median sale price was $236,248 in September vs. $220,000 a year ago. The 2017 monthly median average was $225,585.
- Median price for a Florida condo last month was $182,500, a 5.5% increase over September 2017.
- U.S. median condo price grew 1.5% in September to $239,200.
- The average sale price for houses sold was $355,485 vs. the past year’s monthly average price for houses sold of $370,708.
- Sarasota’s condominiums sold for an average price in September of $311,829 vs. the 2017 monthly average price for sold condominiums was $362,378.
- Overall properties sold for 95.3% of the list price, a consistent ratio on a regular basis. The 2017 average for all properties sold was 95.6% of list price at the time of contract vs. the original list price.
- Currently there is available inventory of 4,046 properties for sale in Sarasota County, there were 4,401 at the end of 2017, 4,595 at the end of 2016 and 3,598 at the end of 2015.
- Of the available inventory for sale, 508 properties are listed for over $1 million or only 12%. 379 of the active $1m+ listings are houses and 129 are condominiums.
- Sarasota County had 1,083 new listed properties in September. The local market averaged 1,147 new listings per month in 2017. Of the total new listings the past month, 63 properties were listed over $1,000,000, a small amount of the overall available inventory for sale.
- As mentioned, inventories in The Sarasota Real Estate Market have fallen this year and are now just 3.8 months of single-family homes and 4.2 month’s supply of condominiums, both under the 6-month level considered a balanced market. The single-family months of inventory has been consistent all year while the condominiums months of inventory continues to have a slight decrease each month.
- Florida currently has 3.9 months of single-family inventory, up 6.5% compared to last year, and 5.3 month’s supply of condominiums, up about 3% over last year and also close to a balanced market.
- U.S. inventory of all housing types is sitting at 4.4 months of supply, up 4% from this time last year.
As always, I look forward to serving you, your family and friends with their real estate needs. It would be my pleasure to assist in reviewing your buying or selling needs and help to guide you to the best plan to achieve your goals.
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