For the third consecutive month, sales of homes and condominiums in The Sarasota Real Estate Market has grown considerably over the prior year. In the luxury tier, properties selling for more than $1 million were 53% higher in the last 90-days than the same period in 2022.

While there have been several months in 2023 where luxury property transactions had much more modest growth and even declined, the region appears to be on track to exceed 2022’s annual high-end sales by more than 10%. Recently Michael Saunders released the company’s 3rd quarter market update, and I thought my readers would find it informative. Click here to read this comprehensive report.

The chart above shows how the improving inventory levels are affecting sales and pending sales in the price points over $1 million.

Before the end of the year, 149 condos in the new Bayso project in the Quay Commons district are being released for occupancy. The units are averaging around $1.5 million. 35 units closed in November, and many more will be reflected in December’s sales data. It shows what an extraordinary difference a single project can have on the Sarasota Real Estate Market. Additional projects underway in the Downtown Sarasota core, as well as The St. Regis Residences on Longboat Key, will have further impact in the year to come.

The inventory of existing homes and condos remains well below the recognized point of equilibrium for available properties to meet buyer demand. The recent increase in the pace of new listings is a welcome event and I expect the growth as shown in the Trendgraphix data will continue, leading to the prospect of a strong spring season.

Buyers and sellers in most other price points are highly motivated by movement in mortgage interest rates, which will also likely lead to increased activity in both the existing and new homes markets. The vast majority of mortgage holders have rates at 5% or below, and experts believe that with an anticipated reduction of 1-2% over this next year, it is expected the housing markets across the country will see more growth.

The homebuilder sentiment, as surveyed by the National Home Builders Association each month, continues to grow. Builders, especially in highly desirable areas such as ours, are taking advantage of the lack of supply in the existing homes market. Further encouragement for homebuilders is seen in last month’s sales volume. 31% of the nation’s homes sold were new construction – this is a significant contrast to the historical average of 12%.

Recently, Fannie Mae in partnership with Pulsenomics, performed the Home Price Expectations Survey. The poll of more than 100 housing experts is used for forecasting national home price changes over the upcoming five years.

The Q4 2023 report noted that the mean expectations are for an annual growth of 3.8% over the next five years. The most optimistic quartile of the surveyed panelists is projecting an average of 5.7% annual growth. There have been many prospective buyers who have been waiting for a measurable drop in prices. If you are in that group, 2024 appears to be your time to take action, as the pace of appreciation is expected to increase in 2025 and beyond.

As we near the busy winter and spring selling seasons, those considering bringing their property to market need to begin the process of finding a seasoned real estate professional, have them give you an assessment of potential pricing and improvements to consider prior to listing, as this can take some time to accomplish.

Buying and selling homes this season will take some strategy, since inventory of existing homes and condos is still tight compared to historical levels. As new listings come on the market there are many eager buyers waiting to jump at a property that can meet most of their wish list. Buyers need to be prepared to communicate their “must haves”, “nice to have”, and “bonus haves” to their Realtor so that they can alert you as soon as something lists that checks most of your boxes.

Michael Moulton is a Realtor with Michael Saunders and Company.