Positive Presage For Fall Activity

Real Estate

BY MICHAEL MOULTON SRQ DAILY SATURDAY PERSPECTIVES EDITION SATURDAY OCT 31, 2015

While the summer months in the Sarasota Real Estate Market tend to produce softer activity than our traditionally higher seasons of winter and spring, the summer real estate market here clearly didn't take a break from its record setting pace.  Third quarter sales were 10 percent higher than last year and 44 percent improved over five years ago.  Pending sales increased 6 percent for the quarter over 2014 and were 36 percent higher than the same quarter five years ago.  And with tight inventories and fewer distressed properties for sale, median prices were 12 percent higher than last September and 42 percent greater than they were in 2010. 

Given the healthy pace of pending contracts signed over the last few months, it is a great presage as we enter the final quarter of 2015.  Economists and real estate experts are projecting that by year's end, Sarasota Real Estate will see a 10-year record of activity.

The following data reflects reporting through the local, state and national Realtor associations, as well as a number of other statistical providers nationwide.  In the real estate industry, there is no shortage of analysts and resources to be sure.  As one of the nation's most important economic indicators, everyone like to keep their eye the housing market.

Nationwide the real estate market is outpacing inflation by almost three times. Some economists call it the "silver lining" in the economy.  As sellers have recovered equity in their homes and real estate continues to be the No. 1 choice for building wealth, the market is expected to continue its healthy growth. While the last few years have seen remarkable increases in pace of sales and prices, looking forward I believe the Sarasota Real Estate market will likely hit the record sales pace projected for 2015, and also see continued modest growth through 2016. 

  • Total sales in September in the Sarasota Real Estate Market were consistent with the same month a year ago but have increased 8 percent year to date from 2014.
  • Sales in the U.S. were 8.8 percent more than last year, the highest number since 2007.
  • In Florida, condo sales rose 8.4 percent over the prior year and single-family home sales increased 13.4 percent.
  • September was the first month in the past six months where the closed sales activity did not surpass 1,000 closings. Though it is noteworthy that a six month run in excess of 1,000 transactions has never happened before in Sarasota.
  • Distressed sales (short sales and bank owned) as a percentage of total sales have continued to fall.  In September those sales were 12 percent of total sales in Sarasota, considerably below the 50 percent mark at the bottom of our housing market, and 20 percent of sales a year ago. Most of the sales of distressed properties are in price points below $500,000.
  • Nationally, 7 percent of all closed transactions in September were considered distressed properties. 

Pending contracts are an excellent predictor to activity in the months ahead.  The pace was nearly equal in September with previous year.  With many of these contracts set to close in October, it appears that The Sarasota Real Estate Market is primed to achieve similar sales to last year's record-setting month. 

As Sarasota finds itself at or near the top of every "best places to retire" lists, I see the Baby Boomer age group assiduously seeking their vacation and/or retirement homes here. The younger generation has seen skyrocketing rents, making home ownership a more affordable choice for them. In addition, in studies, Millennials have been found to consider home ownership one of the most desired forms of equity.  Though the majority of my business is in the Baby Boomer age group, I am seeing more young professionals coming to me looking for homes to settle their families into. 

Yes, Sarasota is definitely growing.  And to some, I understand growth is something to fear. From my perspective, all that makes Sarasota one of the finest cities in which to live, work and play can only get better as more and more passionate new neighbors join us on this great evolutionary journey our community is experiencing.

Michael Moulton is a certified residential specialist broker-associate with Michael Saunders and Company.

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