SARASOTA REAL ESTATE – MOMENTUM IN THE MARKET
Over the last two days a wave of data has been released by the Sarasota and Florida Associations of Realtors, the Census Bureau and other national organizations, and as we suspected the news continues to be very positive. The momentum that we have been experiencing in the housing industry is very promising and is showing an ability to maintain strength in the most important components that we follow. The information in this report should give you as much reason to believe, as I and my peers do, that the recovery we are observing is sustainable.
Whether evaluating local, regional or national home sales data, the housing market managed to reach remarkable heights despite an otherwise sluggish economy. Many experts believe that the housing market will retain its position as one of the most important contributors to the country’s economic recovery.
- Closed transactions in Sarasota during October were 17% higher than October 2011.
- Florida as a whole had a more than 25% increase in sales over last year.
- Nationally the number of transactions increased 10.9%.
- According to data that I monitor, Sarasota’s closed transactions for 2012 year-to-date are 13% higher than last year at this same time, more than 1,000 more closed transactions compared to 2011.
- Single-family median sale price for all Sarasota transactions last month was $176,000, which is 17% higher over last year.
- Statewide, the increase was just 9%.
- On a national level the median price rose 9.6%.
- Sarasota condo median sales price was $160,000, or 11.9% higher than last year.
Monitoring the number of sales that are in process is critical in being able to project market stability and determine what coming trends may be. Again, this important statistic grew at a robust pace leading us to believe that the peak selling season ahead will confirm our region’s real estate market recovery.
- Sarasota’s single-family properties under contract but not yet closed in October were especially impressive with an increase of almost 30% over last October.
- Pending sales throughout Florida grew a stunning 56.7% over the same month last year.
Declining inventory, especially in our region continues to be a great concern. Though homebuilder sentiment remains very positive, driven by strong demand for new homes and growing optimism in housing in general, the number of existing homes has been depleted well below the level of new homes entering the market. Even as considerable construction is underway, industry analysts are expecting the inverted number of homes available compared to buyers in the marketplace to last through the coming year. A market is considered balanced between sellers and buyers when total inventory hovers around six months of supply, though in the higher priced categories, a stable inventory is considered 12-18 months.
- Available listings in Sarasota have decreased 19% since the beginning of 2012.
- Based on sales in October, our region is sitting at approximately just four months of supply.
- The current inventory in our area has not been this low since 1998.
- There are now just 3 ¼ months of inventory for properties listed under $500,000.
- In the segment between $500,000 and $1,000,000, there is a 15-month supply.
- At the luxury level over $1,000,000, the available inventory is a 16-month supply.
- Four years ago the inventory was over 9,500 units, and properties for sale today sits at just 3,500.
- Nationally, inventory levels have dropped almost 22% since last year.
- Florida’s single-family homes supply has fallen 40% compared to 2011.
- The country’s housing starts are robust, on pace to reach 20% more than last year by the end of 2012.
- According to the Census Bureau, over the last 12 months, the U.S. housing market has increased new home starts by almost 42%.
- Homebuilder confidence, according to the National Homebuilder Association, is at its highest in 6.5 years.
The early fall activity has been even more encouraging than the real estate market analysts projected, and I and the peers that I have discussed the trends with agree, as we move into the peak selling season in Sarasota we are more confident than ever that the housing industry is in a sustainable model for recovery.
After reviewing the consistent market improvements noted in this article, the concern about inventory is the only area where uncertainty exists within the industry. Though calls from prospective homeowners considering listing have increased, the demand is still outpacing supply leading me to state again this month that we are in a period where the market is ripe for sellers. Whether a homeowner’s goal is to downsize, move up, relocate out of the area, or consider renting while the market finishes its stabilization, conditions as we enter our peak selling season are right for a sale. Industry experts are expecting continued small price growth for another year or two, however buyers are in our market and ready to make a purchase now. Why wait?
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).