Blog

Aug
01
Sarasota Real Estate - Little Supply, Big Demand

The title of this topic should come as no surprise to those of us who have been following the trends in the real estate market. In any big industry we always hear this phrase, “Supply and Demand,” and that is surely the case with the housing market, especially with the way business has been progressing. The buyers have just been coming out of the woodworks to take advantage of these low prices and great interest rates. Everyone seems to be trying to get a piece of the short sale and foreclosure action while it is still prevalent. With all of the demand, we are seeing a dwindling supply of houses, taking inventory rates to an all-time low. The inventory of available homes in the Sarasota market fell to only 3,114 in June 2013 which is the lowest it has been in over 10 years, and an 18 percent drop from last year around this time. Declining inventory generally results in greater competition for available homes and condos, and subsequent price escalation.

Sarasota Home Sales Continue to Rise

Members of the Sarasota Association of Realtors sold 883 properties in June 2013, a drop from May 2013’s figure of 1,020. Sold were 642 single family homes and 241 condominiums in June 2013, compared to June 2012 totals of 603 single family homes and 261 condos sold in June 2012. In the first half of 2013, sales were up 13.8 percent over last year at this time. If the current trend continues, 2013 will go down as the second highest sales year in the 90-year history of SAR. This is only surpassed by 2004’s record figure of 11,267 closed transactions. Of course we all know how competitive our Sarasota members are, and I don’t see them being satisfied with being only a part of the second highest year, but ultimately excel beyond expectations to be a part of the number one sales year in SARs 90 year history.

Pending sales for June 2013 stood at 1,024 and this is the sixth consecutive month that they have topped 1,000; a historic first for SAR. The previous record stood at five consecutive months for pending sales which was also acquired during this year. In May 2013 there were 1,157 pending sales reported, and last June there were 911. Pending sales have now topped 1,000 every month during this year, 2013. This important statistic represents properties that went under contract during the month, and indicates sales in July and beyond could also be at near record high levels. These pending sales allow us to give more accurate prediction of how our market is performing currently and also for the future months ahead. I will have to say, for an unlucky number the year of 2013 has been darn good to the members of Sarasota Association of Realtors!

Median sales prices have been quite interesting to follow in the recent market. The figure for single family homes was $200,000 in June 2013, down from the May figure of $220,000, but still 12 percent higher than last June’s figure of $178,500. For condos, the median was $192,500, slightly below May’s figure of $194,250 and below last June’s figure of $195,000.

Home vs Condo Ownership

We are noticing that more buyers are looking to own their own piece of land without the fees of a condominium association. The factors that normally are involved in making the decision of a condo versus a single family home are normally the financial stability to be able to afford and maintain the bills of owning a home and also the maintenance for your home as well. Most of your condo associations will take care of the insurance for the building, roof, and exterior maintenance. They will also cover necessities such as the water bill, cable, sewer, insurance, and also a concierge service depending on the type of condo.

No Summer Lull

“For the past two summers, we have not experienced the typical lull in sales we had been seeing for several years,” said SAR President Roger Piro. “We are still seeing a strong surge in the spring, but there seems to be a second season for the buyers that typically relocate in the summer and prepare for school in the fall. These buyers tend to be more families, rather than retirees or investors.”

The available inventory hit yet another new decade low in June, dropping to 3,114 from May’s figure of 3,297. The inventory is down almost 18 percent since June 2012, when it stood at 3,816. The June 2013 months of inventory stood at 3.2 months for single family and 4.3 months for condos, with both property categories very near the lowest level in the past decade which was achieved last month with 3.0 and 3.9, respectively. Months of inventory represents the time it would take to deplete the current inventory at the current sales rate. Last June there were 4.1 months of inventory for single family homes and 5.2 months of inventory for condos. At the worst point of our market in November 2008, there were 24 months of inventory for single family homes and 41.7 months for condos.

Currently, 379 properties listed for sale in the MLS are short sales or foreclosures, up from last month’s figure of 333. This represents 12.2 percent of available properties, up from last month’s figure of 10.2 percent. Sales of distressed properties represented about 23 percent of the overall sales in June 2013, almost identical to the May figure, but much lower than the 51 percent figure experienced in the fourth quarter of 2010.

“The Sarasota area is blessed with incredible natural beauty, great cultural assets and tremendous amenities that families enjoy year round,” said Roger Piro. “We have a tremendous real estate market, and more and more people are finding out about this area, across the nation and around the world.” It’s no wonder why people flock here for vacation and also to move here permanently or even seasonally for our tropical like weather, sunny beaches, cultural atmosphere, and the fact that this is truly paradise for any age group.

If you would like to learn more about homes for sale in Sarasota or the surrounding communities, please don't hesitate to contact us at (941) 284-4474 or Toll free (941) 404-4737. One of our qualified agents will gladly get back to you.


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