Real Estate Matters

November 2011 property transactions in the Sarasota real estate market totaled 602, up 12.7 percent over last November. The total also exceeded the October 2011 sales figure of 577. The market has remained strong and stable as the winter season gets into full swing, reflecting continued confidence in Sarasota as a destination location, according to the Sarasota Association of Realtors.

In fact, the Today Show's real estate report from Barbara Corcoran in late November noted that Sarasota was one of the top recovering markets in the nation. Corcoran said Sarasota is a "beautiful beachfront community" that offers residents and visitors "a sophisticated, urban cultural experience" that is propelling sales and prices in 2011.

Overall, sales in 2011 continued on pace to exceed last year by a wide margin, and should put the Sarasota market at the highest level since 2005. In fact, at the end of November, overall sales were within 186 sales of exceeding all of last year. This sales resurgence has paralleled the drop in the available inventory, and put the remaining months of inventory in the range of a seller's market.

The inventory of available properties for sale in Sarasota was at 4,672 in November, up slightly from October's level of 4,525. The inventory sunk to a 10-year low of 4,408 in August 2011.

The November 2011 median sale price for single family homes rose to $162,000 from the October 2011 median of $149,838, a rise of 8 percent. This month's figure was also higher than last November, when the median was $160,100. The condo figure has been fluctuating for several months, and again dropped in November to $127,000 - lower than last month's figure of $143,000 and last November's figure of $159,000. The year-to-date median sale price was $155,000 for single family homes and $157,250 for condos. These figures have remained remarkably steady for the past year, indicating a stabilizing market.

"The Sarasota real estate market has retained traction, and we hope the brightening national economic picture will help maintain and even push this market higher," said SAR President Michael Bruno. "There is an encouraging sense of stability and strength in our market."

Pending sales were up in November 2011 to 782 compared to last month's figure of 772 and last November's total of 764. Last month, 552 single family homes and 230 condos went under contract.

The distressed property market was relatively unchanged, but did drop slightly from 43 percent of the total market to 41.3 percent. At the height of the foreclosure crisis, that figure topped 51 percent in the second quarter of 2010.

"We were certainly happy to see that Sarasota was in the national spotlight on the Today Show, and in a positive way," said Bruno. "Very few communities in the nation can compete with Sarasota in terms of affordable home values, climate, culture, amenities and the wealth of properties offered here."

Information courtesy of Sarasota Association of Realtors

According to the National Association of Realtors latest annual report on international home buying activity, the U.S. remains a top destination for foreign buyers.  International purchases surged by $16 billion this year, one the the highest increases in recent years.

According to the survey, total residential international sales in the U.S. (for the year ending March 2011) equaled $82 billion, up from $66 billion in 2010.  Total international sales were split evenly between nonresident foreigners and recent immigrants, while combined total domestic and international existing sales in the U.S. were $1.07 trillion

Immigrant buyers (those in the U.S. less than 2 years or with visas) now account for half of U.S. foreign buyers, or $41 billion (this group grew by $16 billion).

Chinese buyers overtook Mexico and U.K. as the second largest buyer group, after Canada.

Buyers from over 70 countries purchased property in the U.S.

The top 10 countries (in order):  Canada, China, Mexico, U.K., India, Argentina/Brazil, France, Germany, Japan and Russia.

The noted reasons for investment include:  secure investment, rental and long-term appreciation, purchase residence for college students, foreign executives temporarily working in the U.S.

Cheers,

Bill

Due to the fact that the Sarasota real estate market continues to be heavy with short sales and bank-owned home and condominium sales, bargains remain plentiful for buyers. According the the Sarasota Association of Realtors (SAR), distressed condo sales have lowered the overall median price down substantially, with normal arm's length sales garnering three-times as much as bank-owned properties and twice as much as short sales on average. The median sale price for distressed properties continues to be less than half as much as for normal arm's length sales, and in many cases approaching only a third as much.  Once the distressed property inventory drops, we should see a return to clear property price appreciation.

In effect, the real estate market has essentially remained the same for the last 12 months, with minor fluctuations in prices month to month.  There was an expected spike in sales experienced during the three months of the federal $8,000 homebuyer tax credit period.

The level of sales of distressed properties (foreclosures and short sales) rose in September to 54.6 percent, from last month's figure of 47 percent.  According to SAR, this was the highest percentage since the distressed market began to show dominance locally.  Distressed market sales previously reached a high just below 50 percent in late 2009, and have hovered in the range between 44 and 48 percent since that time. 

The months of inventory for single family homes in September rose to 9.9 months from 9.5 months in August.  The figure was 9.8 months in September 2009.  This figure represents the number of months it would take to sell all available homes at the current pace.  For condos, the figure rose to 15.1 months from 13.5 months in August.  Once the market reaches the 6 month level it is considered to be in equilibrium between a buyers and sellers market. 

So, if you are considering purchasing a primary or second home in sunny Sarasota (better known as paradise), the time is right now.  With low prices and historic low interest rates, the time could not be better.

Cheers,

Bill Geller