Spring Sales Swell

Real Estate

BY MICHAEL MOULTON SRQ DAILY SATURDAY PERSPECTIVES EDITION SATURDAY JUL 29, 2017

Looking back at the Spring Selling Season in the Sarasota Real Estate Market, total sales in the months March-May grew more than 7 percent over 2016, with condominium transactions seeing the largest growth over prior year. At the same time, inventory has also grown generally keeping up with demand, and has been pretty evenly split between new listings of single-family and condominiums.

The result of this steady sales and inventory growth has been a shift, bringing the market closer to neither favoring sellers nor buyers. However, in the less than $250,000 tier there continues to be a scarcity of product, especially in the most desirable locations where our workforce and young families are looking to buy.

In the greater than $1 million tier, inventory has grown quite substantially in the single-family home segment, taking available properties to a nearly 15-month supply. This is forcing sellers to reassess their pricing strategy, potentially creating an advantage for buyers seeking a home in this category. In the luxury market of condominiums, inventory is closer to a 6-month supply, which is considered a position of market equilibrium.

In May, pending sales once again improved over prior year, indicating that June sales may again show growth in the Sarasota Real Estate Market. Recent surveys of consumer confidence have shown that it continues to rise, further fueling the all-important economic engine of real estate. Analyses of the homebuilder market also reflects their confidence in the market’s demand and ability to absorb new homes and multi-family development.

In addition, economists have released their projections after the first quarter of 2017 indicating that, barring any major geopolitical disruption, the U.S. economy is on track to grow GDP at a rate of 2.5-3 percent over the next few years, after a flat 2-percent rate for the last eight years. This is expected to translate into more jobs and wage growth, increased household wealth, and will most likely trigger more investment in real estate.

Looking at the whole of The Sarasota Real Estate Market and comparing to national and state data, the following are some of the key points that I assimilated from the many resources I review on a monthly basis:

  • Total sales in The Sarasota Real Estate Market in May improved by 10 percent over prior year and increased slightly from April, with total dollar volume rising by $6 million over April and approximately $8 million over May 2016.
  • Single-family home sales in May of 822 were 61 more than a year ago or 8.7 percent higher, and increased slightly compared to April. Florida single-family sales grew 7.6 percent compared to last year, recording the most ever homes sold in a month. U.S. sales were up 2.7 percent from prior year.
  • Total number of condominium units sold of 425 in Sarasota in May was nearly 13 percent higher than a year ago, and increased by 44 sold properties from the prior month. Florida condo sales were 8 percent higher than May 2016, also setting an all-time record. Condo sales nationally grew 3.2 percent over May 2016.
  • The 2016 monthly average of single-family sales was 653, and for this year the monthly average is 678. For condos the average monthly sales in 2016 were 301, and this year it is 349.
  • All cash sales in Sarasota continue to be strong with 36 percent of single-family and 62 percent of condos sales were closed without a mortgage. By comparison, all cash transactions in all of the U.S. were 22 percent of sales.
  • Pending sales of 753 homes that went under contract during May, increased by 12 sales over the same month last year, a 1.6-percent increase. Condominium pending sales of 425 increased by 48 sales from a year ago, a 4.2-percent increase. This statistic is helpful in projecting sales growth in the 30-60 days ahead. U.S. pending sales fell 1.7 percent compared to prior year. Florida's pending sales saw approximately 7.5 percent increase in homes going under contract in May.
  • The monthly average of pending sales this year is 795 for houses and 401 for condos.

Despite being in what many consider to be our quieter summer selling season, I have seen only a slight dip in demand from new and repeat clients looking to purchase. I am convinced that the Sarasota Real Estate Market is a year-round pursuit for eager buyers and sellers. 

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

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