Local Home Sales Hit New Heights

Local Home Sales
Homes sales in Southwest Florida hit a second-straight record in 2015, again outpacing the historic boom of the mid-2000s.
The frenzied pace, driven by a stronger economy and pent-up demand from current and future retirees, came in a market teeming with double-digit price hikes and a dwindling supply of homes for sale.
Buyers closed on 20,691 existing homes and condominiums in Sarasota and Manatee counties last year, an increase of 6.7 percent, or 1,302 deals, over 2014, when sales topped the previous record set in 2004, according to the Realtor Association of Sarasota and Manatee.
Michael Saunders, founder/CEO of the region’s largest locally based real estate brokerage, credits the return of strong economic fundamentals here and in the northern feeder markets. Her company posted $2.73 billion in sales last year, a $500 million increase from 2014.
“The revived economy unleashed torrents of pent-up housing demand, which had lain dormant for several years,” Saunders said. “These high levels of demand are still playing out, and have kept our housing inventories well below normal for the past 18 months and counting.”
Sales volume jumped 23 percent over the year to hit an all-time high at Berkshire Hathaway HomeServices Florida Realty in Venice, said agent Charryl Youman.
“I was dancing as fast as I can, since the market sped up as the year advanced,” Youman said. “I think most Realtors would agree that our numbers would have been amazing if we had the resales inventory, as many buyers are still standing there with their catcher’s mitts on, waiting for the right pitch.”
Meeting the Demand
At year end, the supply of existing single-family homes for sale stood at 3.8 months in Sarasota and 3.9 months in Manatee, both down nearly 9 percent from 2014. A six-month supply is considered a balanced market.
New construction projects have filled some of that void. Saunders said 2015 might have reached a firm record if sales at under-construction projects, such as Vue Sarasota Bay, could have counted. Those sales aren’t official until the buildings are completed and owners have closed.
Market Overview
Buyers paid a median $253,650 for a single-family home in Sarasota-Manatee last month, a 16.4 percent increase over the year. Condo prices rose 15.5 percent to a median $200,000.
While the roiling stock market may have spooked some potential buyers early in the new year, real estate agents expect the improved economy and still-low interest rates will keep sales strong this year.
“Our industry has been steadily and soundly rebuilding,” said Linda Formella, the 2016 president of the Realtor Association. “I am looking forward to a healthy year of steady growth in 2016.”
Cash buyers continue to account for about half of all home sales in the region.
“And they still rule in multiple-offer situations,” Youman said.
Sales of luxury properties improved in tandem with the recovery of investment portfolios. Saunders said transactions over $1 million rose 16 percent at her firm last year.
But lower-priced homes remain in demand as well.
“Hot price points continue to be anything decent under the $200,000 mark,” Youman said.
December sales were actually down slightly in Sarasota-Manatee. Buyers closed on 1,199 homes, off by 1.1 percent over the year, and condo sales slipped 2.3 percent to 472 units.
In Charlotte County, where full-year sales were not available, buyers in December closed on 400 homes, which was 2.8 percent ahead of last year, and 91 condos, down 6.2 percent.
Homes traded there for a median $180,000, up 21.6 percent, while condos were down 0.7 percent to $135,000.
Homes also are selling more quickly, and buyers are getting closer to their asking prices. In Sarasota, for example, homes were snapped up in a median 33 days last month, 11 days faster than last year. Sellers pocketed 95.4 percent of their original list price, up from 93.1 percent.
“Low interest rates — which remained relatively low in spite of the Fed’s modest year-end increase — still have consumers who need financing stepping up to buy,” Saunders said.
Statewide, single-family sales totaled 23,056 last month, up 2.9 percent over the year. Condo sales fell 1.2 percent to 9,357, according to the Florida Realtors trade group.
Homes sold for a median of $206,500, which was 11.6 percent more than last year. Condos traded for $156,500, up 5.0 percent.
“Florida’s real estate markets remained quite healthy in December,” said Brad O’Connor, chief economist at Florida Realtors. “Closed sales remain strong, and prices continue to rise.
“Inventory levels of single-family homes dropped to an annual low for 2015 at the end of December, to just under 100,000 active listings,” he added.
Nationwide, total home sales in 2015 were the most in nine years, as closings rebounded in December after new regulations had delayed the completion of purchases in November.
The National Association of Realtors said sales of existing homes climbed 14.7 percent last month to a seasonally adjusted annual rate of 5.46 million. Sales had previously plummeted as the industry adapted to new mortgage disclosure rules — a temporary downturn before delayed sales were finalized in December.
“This is a great way to cap off 2015,” said Jennifer Lee, a senior economist at BMO Capital Markets.
Last month’s rebound concluded a year that produced the highest annual sales total since 2006. Steady job growth and low mortgages drew more buyers into the market, causing both sales and prices to climb.
Americans bought roughly 5.26 million homes in 2015, a 6.5 percent increase over 2014. The median sales price rose 6.8 percent to $222,400.
The Realtors forecast that sales will stay flat in 2016 and that the median price will rise more than 4 percent. A price increase that big would compound a problem for many would-be buyers: A rising proportion of homes are unaffordable. Home values rose last year at more than twice the pace of pay.
Herald Tribune January 22, 2016