Indeed, the Sarasota Real Estate Market frenzy of activity has cooled. However, a significant volume of new listings has given the market a chance to re-set a bit and offer more options for the abundant motivated buyers in our marketplace. With our customary peak tourist and buyer season nearing, I am delighted to see more product available to show, somewhat relieved for a slowing of the feverish bidding wars, and a return to a more balanced housing market.
Summer months in Sarasota typically see a softening of contracts signed and closed. So, comparing 2022 activity to 2021 is impractical due to the unique market abnormalities that stemmed from the pandemic. The effect of the panicked “great reshuffling”, as some economists called the migration seen over the last two years, was simply unsustainable with the resulting deficiency in available properties for sale.
In 2022 we are amid a heated political environment, rising interest rates, volatility on the financial markets, and global concerns which have given some buyers pause, even those normally unfazed when it comes to luxury buying.
In addition, a pent-up desire for extended travel, family gatherings, delayed weddings and events, and an earlier start to the school year in some parts of the nation have also been disruptive to buyer focus. Buyers are also reportedly waiting for more new properties to come on the market, and willing to slow their search.
As you will see in the attached chart with data from the first seven months of 2022, conditions are definitely changing. The number of available properties at the end of July was nearly double the same month in 2021, and nearly triple the number of properties for sale at end of 2021.
Despite this great growth in available homes and condos for sale in the Sarasota Real Estate Market, inventory of single-family homes remains at just 2.0 months of supply, and condos have only 1.6 months – leaving us in a solid seller’s market. We have a long way yet to go to reach the theoretical balanced market in which there would be six months of inventory.
A heightened supply of properties for sale would be expected to temper the pace of price appreciation. Though when comparing to prior year as the data later in my report shows, home and condo median prices are up about 30% compared to 2021.
However, as is evidenced in the chart here, prices for both median and average sold prices seem to have stabilized when looking at our year-to-date sales.
Economists are pointing to a solid foundation in the housing market, especially in areas such as ours. Yes, there are some parts of the country where prices escalated so much that there is potential for declining values – i.e. San Francisco, Phoenix, Austin and others. Sarasota may have seen double digit growth for the last two years, but experts are saying this region was somewhat undervalued prior to the pandemic and continues to remain moderate when compared to other high-demand regions.
There has been media attention on home builder confidence waning. And while that may be the case on a nationwide basis, our local builders remain optimistic as is evidenced by regional builders announcing new developments, and new national builders entering our market.
Builders are experiencing conditions that are creating headwinds and forcing restructuring of pricing – including inflation, supply chain issues, curtailed production during the pandemic, shipping costs, and labor caused by competition and fewer young workers entering the industry. Analysts are projecting a 14% increase in year-over-year construction costs this year. And because much of the new home building is in the mid-price tier, many buyers are reliant on mortgages, and interest rates are affecting demand.
Though the entire housing market is in a state of flux right now, I do believe the underpinnings to establish sustainable stability and continued growth exists for Sarasota. It is not unusual to have softer seasons. So, while some media attempts to report “the sky is falling” and we may enter a housing recession, I do not see potential for that in our region. Sarasota endured a ravenous appetite during the pandemic to be sure, but certain of our market conditions, such as days-on market and inventory remain below historical averages.
I feel optimistic that the stabilizing prices, growing inventory, and continued high demand for purchasing land, homes and condominiums in our region will result in a return to a more normalized pace of activity in the fall and winter season ahead.
To buy or sell in today’s fluid real estate market, you need to engage a realtor who has rich experience in the local market. While we have not seen conditions quite like this before, engaging 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 negotiating the purchase or sale of a home or condo, especially during unique times, is what I love to do!
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 a perfect opportunity comes along to buy your dream home, you will be first to know!
And now for my statistical report on the July Sarasota Real Estate Market activity:
- Total market dollar volume in July was $641.6 million, which decreased by $65.8 million from a year ago.
- Broken down, single-family sales were $486.4 million and condo sales were $155.2 million for the month.
- The number of properties sold in July was 967, which is 298 less than a year ago. The sales total includes 678 houses and 289 condos. The monthly average of sold properties this year is 1,173. The monthly average was 1,369 last year and 1,179 in 2020.
- Florida’s single-family sales decreased by 22.9% from last year, and condo sales were 24.5% below last year.
- U.S. sales of single-family sales fell 19% and condos were down 29.6%.
- Of the closed sales in July, 107 were for over $1,000,000; of which 78 were houses and 29 were condominiums. In 2021 Sarasota averaged 128 sales per month over a $1 million.
- Homes sold for over $1 million in Sarasota were off 7.1% from July 2021 and condos closed at over $1 million fell 9.4%.
- Across Florida, $1 million homes fell 8.2% and condos were down 27.2% from prior year.
- In July 921 listings went to a pending contract, a decrease of 154 transactions from a year ago. Year to date there have been an average of 1,154 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 decreased 19.2% and condos fell 24% compared to last year.
- U.S. pending sales in July were nearly 20% below a year ago.
- Single-family homes were sold at a median price of $525,000, a more than 30% increase over prior year. The 2021 monthly median price for houses sold was $394,000.
- In July, Florida median price for single-family homes was $412,303, a 16% increase over last year.
- The national median price for existing homes grew 10.6% to $410,600.
- The condo median sale price was $390,990, more than 20% over the 2021 monthly median price of $317,000.
- Median price for a Florida condo last month was $305,000, a 20.6% increase over July 2021.
- U.S. median condo price grew 9.9% to $345,000.
- Sarasota houses sold on average for $717,398. The monthly average sale price this year is $686,789, where the 2021 monthly average was $573,000 and in 2020 it was $321,000.
- Condos sold for an average price of $537,132 last month. The condo monthly average sale price this year is $568,143 and in 2021 it was $527,000 and in 2020 it was $382,000.
- Currently there are 2,176 properties for sale in Sarasota. This is an increase of 222 listings from the month before. 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, 472 properties are listed for over $1 million. Of the active listings over $1,000,000, 344 are houses and 128 are condos.
- The Sarasota market had 1,336 new listings the past month. The market averaged 1,321 new listings monthly in 2021 and this year the average is 1,462.
- Current inventory results in 2 months of single-family homes for sale in Sarasota and 1.6 month’s supply of condominiums. This is the first month since October 2020 to have two months or more of single-family homes listed for sale.
- Florida currently has 2.2 months of single-family inventory and 2.1 month’s supply of condominiums.
- Inventory of single-family properties selling for over $1 million in Florida increased by 42.2% and condo supply has grown 13.8% over last year.
- U.S. inventory of existing homes and condos for sale is nearly equal to last year, currently reflecting a 3.3-month supply.