Home Buying Season in Full Swing

Southwest Florida’s home buying season is in full swing — and it’s shaping up to be one of the busiest ever. Despite rapidly rising home prices and lingering inventory woes, homes from Parrish to Punta Gorda continue to change hands at the fastest clip on record, and most industry watchers don’t foresee it slowing any time soon. The surging activity in February comes during the busiest time of the year for real estate in Florida, with snowbirds and vacationers in town, some scouting for homes. Coupled with pent-up demand from the Great Recession, and restored stock wealth for many retirement buyers, the market is poised for another robust spring, according to area Realtors. “People are able to sell their homes up north and plan retirement,” said Gloria Weed, branch manager of Michael Saunders & Co.’s office in Lakewood Ranch. “I have lived here for 30 years, and I have just never seen so many people here during season. Just look at the traffic.” “The more people who’re here, the more who like, the more who decide they want to live here and buy homes here,” Weed said.

• Agents sold 1,875 existing homes and condominiums during February in Sarasota, Manatee and Charlotte counties, according to figures released Monday from the industry trade group Florida Realtors.

That was up 12.8 percent from a steady January and 8.8 percent ahead of the same time in 2014, which finished as the best year for real estate activity in history. Because housing contracts typically take 30 to 60 days to close, these figures represent deals that were likely first inked in December or early January, the start of the region’s season. Those existing sales also do not count new homes, which also are selling at post-recession bests. “It’s the continued growth and exposure in other areas,” said Peter Crowley, broker and co-owner of Re/Max Alliance Group. “You couple that with miserable winters up North, and I just believe we’re the beneficiary. The buyer demand continues to be very strong.” Rising prices That swelling demand has pushed the median price for a single-family home in the North Port-Bradenton-Sarasota area up 12.5 percent over the year to $225,000 in February. The median is the midpoint: half the homes sold for more, half for less. Of the Florida metropolitan areas where home data is tracked, only Port St. Lucie, Jacksonville and Lakeland saw their single-family housing prices climb faster.

• Condominium prices in this region similarly rose by 6.8 percent of the year to a $175,000 February median.

The recent price gains have sparked fears of housing affordability for working- class families, with average rents similarly growing at historic levels, while worker wages generally have remained stagnant. The Federal Reserve also is expected to ease its bond buying strategy this year and raise interest rates, which could begin to impact the cost of mortgages, which have remained a key selling point. The average fixed interest rate for a 30-year, conventional mortgage in February rose slightly to 3.71 percent, but still remains historically low, according to Freddie Mac. Some analysts remain skeptical on the industry’s future. They point to lingering foreclosures, investor impacts, tight financing availability and poor wages. Some also question whether there is enough full-time owner occupiers to support the market’s sustained recovery. “There’s a tremendous amount of hype in the marketplace,” said Jack Mc-Cabe, a Florida real estate consultant. “We all know what happened the last time we saw this. I think we’re in a transition stage, and I really believe we will be back to a buyer’s market by the end of the year.” The bigger picture The sales trend was similar across the Sunshine State, where Realtors sold 26,961 existing homes in February, up 15.3 percent from January and a 15.2 percent increase from the same time last year.

• The statewide price for a single-family home reached a February median of $179,995, up about 9 percent over the year, according to Florida Realtors.

Across the country, home sales improved as inventory shortages pushed price growth to its fastest pace in a year. Existing home sales rose 1.2 percent from January to a seasonally adjusted annual rate of 4.88 million in February, which was also 4.7 percent higher than a year ago — the fifth consecutive month of annual gains, according to data released Monday by the National Association of Realtors. The median home price last month also jumped nearly 8 percent to $202,600, the largest national increase since February 2013. Those improvements were driven largely by a stock of existing homes for sales that remains below a year ago at a 4.6-month supply, which measures the time it would take to deplete the inventory at the current sales pace if no new homes were added to the market. “Insufficient supply appears to be hampering prospective buyers in several areas of the country and is hiking prices to near unsuitable levels,” NAR Chief Economist Lawrence Yun said in a statement. “Stronger price growth is a boon for homeowners looking to build additional equity, but it continues to be an obstacle for current buyers looking to close before rates rise.” “With all indications pointing to a rate increase from the Federal Reserve this year — perhaps as early as this summer — affordability concerns could heighten as home prices and rents both continue to exceed wages.” “It’s the continued growth and exposure in other areas. You couple that with miserable winters up North, and I just believe we’re the beneficiary. The buyer demand continues to be very strong.” – Peter Crowley, broker and co-owner of Re/Max Alliance Group Herald Tribune 3/24/2015