Real Estate Matters

Home sales in the Sarasota real estate market rose above the 600 level for only the second time in 26 months in June 2009, while the median sale price rose for both single family and condos, once again demonstrating a market in the initial stages of recovery.

Inventory levels once again dropped markedly, and the months of home supply on the market (a key indicator) – the number of months it would theoretically take to sell all the current properties for sale – now stands at 9.97 months for single family homes and 16.1 months for condos. The figures were 14.3 months for single family homes and 19.0 months for condominiums in May 2009, and 15.2 months and 22.9 months in April 2009. The clear trend is toward the figure o 6 months, which indicates a market in balance (anything below 6 months indicates a return to a seller’s market).

The overall sales level of 610 included 449 single family homes and 161 condos, which increased over last month’s total figure of 506 sales by 20.4 percent. June 2009 was also better than June 2008, which saw only 541 overall sales. The last time sales topped the 600 level was in May 2008, when sales hit 627. Prior to that, there were 653 sales in March 2007.

Pending sales also remained at very high levels, with 866 properties going under contract in June 2009. The figure was down slightly from 929 in May 2009 but near 981 pending sales reported in April 2009. The total of 866 is 50 percent higher than the 579 pending sales reported in June 2008. Pending sales have now exceeded the 500 level for the 18^th consecutive month and the 800 level for the fourth straight month.

The statistic is a strong indicator for the next two or three months of sales, when many of these pending sales will become closed sales. Pending sales reflect contracts executed by buyers and sellers during the month.

There has been very high interest in the federal $8,000 first-time home buyer credit, and this has helped spur the market. The credit expires on November 30, 2009, so local Realtors should strongly urge their clients to get started in the process in order to close the sales before that date.

In addition to the positive factor of the tax credit, the national recession and job market woes have held down what could have been a major surge in home sales. But despite the negatives in the national economy, the local real estate market continues to show signs of recovery.

Our market was one of the national hot spots for the real estate boom in 2008-2005, so naturally we experienced a rough couple of years as the market moved toward more normal, realistic pricing. But now, the community’s incredible amenities and attractive real estate prices are taking center stage, and we’re seeing the recovery taking root here.

The median sales price for single family homes stood at $190,000 in June 2009, up 22.6 percent from $155,000 in May 2009. The median sales price for condominiums stood at $250,000 in June 2009, a whopping 38 percent higher than $181,000 in May 2009. While prices have started to climb, they are still lower than June 2008, primarily due to the high number of short sales and foreclosures. Last June, the median sales prices were $250,000 for single family and $275,000 for condominiums.

The median price for all single family homes sold in the last 12 months was $180,000, compared to a median of $269,000 for the 12 months ending in July 2008. For condominiums sold in the last 12 months, the median sales price was $212,000, compared to last year’s figure of $340,000.

The inventory levels in the Sarasota real estate market in June 2009 continue to decline for both single family homes and condominiums. There were 4,477 single family homes and 2,587 condos on the market in June 2009, compared to 4,380 single family homes and 2,488 condos the previous month. The overall decline was from7, 868 to 7,064 properties, a 10 percent drop.

So there is good reason to suggest that we may be entering into the initial stages of recovery in our local real estate market.

Cheers, Bill Geller