As reported in my recent postings, the 2012 winter/spring selling season in Sarasota continues to feed cautious optimism among leading analysts and experts. The Sarasota real estate market showed signs of continued modest improvements in its March activity.
Statistical evidence of a strengthening of the real estate market was seen in both the National and Regional results. On a National level, inventory has dropped a full 25% from last year, the number of distressed property sales fell more than 11 points, prices rose almost 6%, and existing home sales jumped more than 5% compared to last year at the same time. According to the most recent S&P/Case-Shiller Home Price Index, overall home prices are at levels not seen in almost a decade. With economic recovery news tending to be erratic and often unpredictable, these same housing trends seem to be appearing month after month, leading those of us who have been in the real estate industry for decades to believe the signs are consistent enough to predict 2012 will experience a gradual and continuing recovery.
The Sarasota area real estate market had impressive results in March. The Sarasota Association of Realtors, TrendGraphix and other reporting agencies provided confirmation through their month-end accounts of the exceptional regional activity. Some of the most impressive data was that there was a remarkable 48% increase in sales of properties above the $1 million mark and the area saw an almost 4% rise in overall sales from last year – making March sales the highest since 2005! Properties changing hands in the first quarter of 2012 rose a full 7% over prior year for the same quarter.
The median sale price for a home in Sarasota is now 11% greater than last year at this time. A note-worthy statistic released by Michael Saunders & Company is that at the end of March, company pending sales were up an incredible 36% over the same time last year and dollar volume jumped 52% over prior year.
Inventory is a critical component of our healing Sarasota real estate market, and data shows it has fallen 5% since the end of 2011 and 28% since the end of 2010. A market is considered balanced when supplies are at 6 months. With our area sitting at about 5.5 months of inventory, this would normally lead to pressure being placed on prices and, indeed we did experience prices inching up another 4.4% over February. It was reported that the last time inventory was this low was in 2004.
Based on the average monthly closed sales for the first three months of 2012, there are now just 5 months of inventory for properties listed under $500,000. In the segment between $500,000 and $1,000,000, there is a 10.7 month inventory and over $1,000,000 the available inventory is a 26 month supply. In higher priced categories, a balanced market is at a considerably higher months-of-inventory level, with experts suggesting anywhere between 10-26 months as being the norm.
When analyzing all statistical gauges such as sales, inventory and pending sales together, I feel confident that we are on pace to not only just maintain the growth we established last year but, also to continue advancement. With the recent monthly release by virtually every national market data report showing sales growth, positive consumer attitude, builder confidence, ability to absorb “shadow inventory”, narrowing margins between listing and contract price, and compressing inventory, and in light of our region’s extraordinary desirability, it is difficult not to be optimistic about the Sarasota real estate market’s recovery.
The following statistical data is provided through the Multiple Listing Service (MLS) of the Sarasota Association of Realtors by agents within our local board. These statistics do not take into account transactions of agents within Sarasota County associated with other boards. The table summarizes what happened in each price segment. The Sold (Closed), Pending Sale 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. YTD (Year to Date).