The number of available properties in the Sarasota real estate market dropped to a six-year low in February 2011, and sales were up 24.2 percent from the previous month. Median sales prices for both single and condominiums dropped as bargain hunters continued to grab foreclosures and short sales, which represented almost 47 percent of all sales.
Compared to this time last year, sales were up 27 percent to 673 total sales, from February 2010’s total of 528 sale. There were 472 closings on single family homes and 201 closings on condos last month by members of the Sarasota MLS.
In addition to the positive sales figures, pending sales also registered above the 1,000 level in February, with 1,023 total properties going under contract last month. In January 2011, 1,013 properties went under contract. This statistic is a strong indicator for the next two or three months of sales, as pending sales reflect current buyer activity.
Last February, pending sales reached 967. But that figure was pushed upward by the approaching April 2010 deadline for the homebuyer tax credits. This year’s upward trend is being fueled by buyers of all sorts – investors, second-home buyers, and those who realize that today’s lower home prices coupled with low interest rates present buyers an opportunity not seen in years.
Lower median sales prices, which dropped slightly for single family homes (to $137,500 from $138,700) and condos (also to $137,500 from $142,500), were the only cloud. The decreases were likely associated with the continued price pressure of distressed property sales. Normal arm’s length sales still average nearly three times the price of distressed properties in the Sarasota market.
On the positive side, the drop to the lowest inventory level in six years (5,864) could mean upward pressure on sales prices moving forward, according to SAR President Michael Bruno.
“Traditionally and historically, fewer properties on the real estate market usually causes price appreciation,” explained Bruno. “It’s simply a matter of supply and demand. If there are more buyers competing for a smaller number of properties, selling prices are usually driven up. Hopefully, we’ll soon see a return to the traditional local appreciation levels of between 5 and 7 percent annually. That would represent a very healthy market.”
The higher sales totals combined with the lower inventory caused a sharp drop in the months of inventory to 8.0 months from 10.2 months in January 2011 for single family homes, and to 10.4 months from 14.1 months for condos. Only two years ago, in January 2009, there were 25.3 months of inventory for single family homes and 38.4 months of condo inventory. The market is considered to be in equilibrium between a buyers and sellers market once the figure reaches the 6 month level.
The median price for the last 12 months stands at $160,000 for both single family homes and for condominiums. The single family figure was exactly the same as a year ago, while the condo figure dropped from last year’s figure of $185,000.
Source: Sarasota Association of Realtors