Sales Volumes UP

 Inventory STILL SHRINKING

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Home sales once again top 500 in Sarasota Market

Overall home sales in the Sarasota real estate market exceeded 500 for the second time since June 2008, inventory levels dropped, and the median sale price for both single family and condominiums stabilized in May 2009. These statistics all point toward a normalization and moderation of the market following a more volatile period during thepast two years.

The overall sales level of 506 included 375 single family homes and 131condominiums,nearly identical to the April 2009 numbers - 367 homes and 138 condos, respectively.Pending sales also remained at highly elevated levels, with 719 pending sales for singlefamily homes and 210 pending sales of condominiums in May. The overall total of 929 was very near the 981 pending sales reported in April 2009. The trend for pending sales has been upward for several months, with 817 reported in March 2009, when the figure topped 800 for the first time in three years. The total of 917 was 34 percent higher than the 692 pending sales reported in May 2008. Pending sales have now exceeded the 500 level for the 17th consecutive month.

The statistic is a strong indicator for the next two or three months of sales, when many of these pendings will become closed sales. Pending sales reflect contracts executed by buyers and sellers during the month. “We are all encouraged by the recent strength of the local real estate market, and we are hopeful that this upward trend will continue as we enter the traditionally slower summer season,” said 2009 SAR President Bill Geller. “We’ve had many reports of high activity at open houses, and we’re starting to see more multiple offers on homes. Of course, until we get through this period of elevated foreclosures and short sales, the median sales price will remain artificially low. But we can expect those figures to return to a more historic average, with moderate property appreciation once this inventory of distressed properties clears.”

Geller noted the continuation of historically low interest rates, the first-time homebuyers’ tax credit of $8,000, and the influence of government programs designed to ease the deep national recession have all been factors in the local real estate market recovery. Those who meet eligibility requirements and purchase a home this year prior to Dec. 1, 2009 are eligible for a tax credit of up to $8,000, and unlike the 2008 tax credit, this one does not have to be repaid. Across the nation, this has led to a surge in first-time buyers, and Sarasota has mirrored the national trend.

The median sale price for single family homes stood at $155,000 in May 2009, down slightly from the figure of $160,000 in April 2009. The median sales price for condominiums stood at $181,000 in May 2009, also slightly lower than last month’s figure of $182,750. While prices have leveled off, they are still much lower than May 2008, primarily due to the higher number of short sales and foreclosures, which have pulled down the median prices from last year’s level of $274,500 for single family and $367,250 for condominiums.

The median price of all single family homes sold in the last 12 months was $205,000, compared to a median of $289,000 for the 12 months ending in May 2008. For condominiums sold in the last 12 months, the median sales price was $230,000, compared to last year’s figure of $385,000.

The health of the Sarasota real estate market in May 2009 continues to improve for both single family homes and condominiums as inventories continue to decline. The months of home supply on the market – the number of months it would theoretically take to sell all the current properties for sale – now stands at 14.3 months for single family homes and 19.0 months for condominiums. This compares to 15.2 months for single family in April 2009 and 22.9 months in May 2008; and 19.2 months for condos in April 2009, and 24.3 months for condos in May 2008.

Any number above 6 months indicates a buyer’s market, while under 6 months is a seller’s market, and near or at 6 months would be a market in equilibrium, with an equal number of buyers and sellers.