Home Prices Remain Surprisingly Stable During This Time of Crisis
We have been actively reporting on the monthly real estate markets in Manatee and Sarasota Counties for some time now. But the COVID-19 pandemic has had a major impact on markets across the state and indeed across the country. So this month, we thought it appropriate to share the following video by Dr. Brad O'Connor, Chief Economist for the Florida Association of Realtors (FAR). In it, Dr. O'Connor provides insights into the results for February and March and suggests that forecasts for the market during the coming months remains murky.
We remind you that our team remains committed to assisting buyers and sellers during this challenging period. Should you wish to discuss specifically how the current environment may impact your real estate plans, don't hesitate to give us a call at (941) 840-2265. We are here to help.
Sales of existing Single Family Homes and Condo/Townhouse Properties saw dramatic growth in both Manatee and Sarasota County during the first month of 2020. But the sales of Condos and Townhouses more than doubled those of Single Family Homes in both counties during this time period. Prices continued to climb across both counties and property types.
A Virtual Tie Between Manatee and Sarasota Counties in the Sales of Single Family Homes
Closed Sales of Single Family Homes in Manatee County during January saw 410 units closed. That's a 22.4% increase over January of 2019. Sarasota County saw similar growth with 565 units closed for an increase of 22.8% over the same period last year. But the Median Sale Price of Single Family Homes in Manatee County - $329,500 an increase of 6.6% - doubled that statistic in Sarasota County where the Median Sale Price was recorded as $296,000, an increase of 3.3% over January 2019.
Despite the increase in prices, sales velocity was markedly up. The Median Time to Contract in Manatee was just 41 days, a drop of 19.6% over last January. But sales velocity accelerated even more in Sarasota County during the month as Median Time to Contract fell to 34 days, a drop of 24.4%.
On the supply side, New Listings fell in both counties. Manatee County experienced a decrease of 3.7% while Sarasota County reported a drop of 13.7% - a result of the rapid acceleration in sales velocity for Single Family Homes during January.
But the effect of strong demand is most evident in the Inventory of Active Listings. During January, the number of Active Listings fell by 16.3% to 1,973 listings in Manatee County. The results in Sarasota County were even more dramatic with Active Listings recorded as 2,704 units, a drop of 23.8%. Translating these results into Months Supply of Inventory, we find that Manatee County reports only a 3.4 months supply of existing Single Family Homes for Sale a whopping 22.7% decrease over last year. And in Sarasota County the the Months Supply Inventory fell by 33.3% to a 3.6 months supply. These results put the markets for Single Family Homes in both Manatee and Sarasota Counties as strong sellers markets.
You can view the full reports by clicking on the accompanying graphics.
Sales Of Condo/Townhouse Properties Grew By Close to 50%
The big story in January surrounds the sale of Condos and Townhouses. Manatee County saw an increase of 47.7% in sales of these property types during the month. But these results pale in comparison to the 57.8% increase over January 2019 seen in Sarasota County during January of 2020.
Prices increased moderately during January for Condo/Townhouse Properties in Manatee County. The Median Sale Price was reported as $210,000, up 7.7% over last year. But the increase in prices in Sarasota County doubled that. Sarasota County saw the Median Sale Price jump by15.4% over January 2019 to $277,000. Sales velocity increased in both counties with the Median Time to Contract dropping to 50 days (a decrease of 12.3%) in Manatee County and 44 days ( a decease of 13.7%) in Sarasota County.
Inventory also continued to decrease in both counties during January. The number of Active Listings in Manatee County fell slightly by 2.8% to 1,052 listings during January. The decrease was more dramatic in Sarasota County with only 1,674 Condo and Townhouse Property listings, decrease of 18.9%. But Sarasota County had a higher number of Months Supply of Inventory (4.9 months) than Manatee County (4.7%) during this period. But Sarasota County saw a greater decrease in Months Supply of Inventory (19.7%) than in Manatee County (flat at 0.0%).
Once again, you may review the full report by clicking on the appropriate graphic.
Three Important Words for the current Real Estate market - Supply, Supply, Supply
With the number of Active Listings falling across the board, there is a real possibility of buyers having a hard time finding a home. Inventory constraints drive prices higher (remember the rules of Supply and Demand). And in a market with increasing demand and shorter sales cycles, buyers would do well to aggressively search for properties now. The good news is that the website you are viewing contains powerful tools to aid buyers in their search. Best of all they are entirely free of charge! So have a look and if your are interested in viewing any properties, give us a ring at (941) 840-2265. We would be glad to help.
Registration Now Open for the Spring 2020 Bill Mergens Memorial Car and Truck Show at Gamble Plantation.
Mark your calendars!
The Bill Mergens Memorial Car and Truck Show returns to Gamble Plantation on Sunday, March 22, 2020 at Gamble Plantation Historic State Park. The event is open to all years, makes and models of cars, trucks and motorcycles. Last Fall's event attracted over 350 enthusiasts from across the state and our Spring event promises to be bigger and better than ever!
Food will be provided by TK Grill and others while Music will be in the capable hands of the team from Lance's Cruizin' To The Hop. The park opens for entrants at 8:00am and the registration desk opens at 9:00am. The gates will be open to the general public starting at 10:00am.
Proceeds from this year's event will again go to the Gamble Plantation Preservation Alliance and S.O.L.V.E. Maternity Homes.
Two Ways to Register
Participants can register their vehicles in two ways:
Online Registration - the show has been published on EventBrite where tickets may be purchased by clicking this link. Each vehicle entered must be registered and paid for separately and a ticket must be produced for each. The cost of online registration is $15 and is open until March 18.
Mail-In Registration - you can also mail-in registration before March 18, 2020. To download and print the registration form, simply click on the following graphic:Remember, registering before March 18 costs $15 per vehicle. After March 18, registration must be purchased at the gate for $20 per vehicle. As we anticipate a terrific turnout, we urge you to register as soon as possible.
Once again, all registrants will be provided with a picture of each vehicle taken in front of the iconic mansion. Each photo will be professionally printed and mailed in a special commemorative folder courtesy of your friends at SW Florida Homes Group.
So get those registrations as soon as possible. We look forward to seeing you and your ride at the 'Plantation on March 22.
Results Underscore Strong Markets Across the State
We have recently reported the December 2019 results for Sales and Inventory of Single Family and Condo/Townhouse properties in Manatee and Sarasota Counties. This week we thought you might enjoy hearing what Dr. Brad O'Connor of the Florida Association of Realtors (FAR) has to say about the real estate market across this state:
This underscores the strength of our local markets and should provide a stimulus for those looking to participate in the real estate market during 2020.
Expect Fla.’s Economy to Grow, Continue Strong in 2020
ORLANDO, Fla. – The U.S. economy continues to grow – and Florida’s economy is doing even better, outpacing the nation’s growth, according to economic experts who spoke to a crowd of more than 400 Realtors® at the 2020 Florida Real Estate Trends summit on Thursday during Florida Realtors Mid-Winter Business Meetings.
“We’re in the 11th year of the U.S. economic recovery – the longest economic recovery in U.S. history – and there are no indications that’s going to end any time soon,” said Dr. Sean Snaith, director of the University of Central Florida’s Institute for Economic Forecasting. “The national unemployment rate is 3.5%. The labor market is strong by virtually any measure: The number of available jobs exceeds the number of people seeking them and jobs growth is strong.”
Florida’s economy is doing “even better than the national economy as a whole and it has been since 2012,” he said. “Our unemployment rate is down to 3.3%. Florida’s GDP (Gross Domestic Product) continues to grow faster than the U.S.’s GDP, and our job growth rate is almost twice the national rate. Florida’s population growth is solid – the birth rates are better than the death rates, so we’re making new residents faster than we’re losing them.”
While the factors that fueled fears of a possible recession in 2020 have mostly faded, Snaith pointed out one area to keep an eye on: the U.S. debt, which now exceeds $23 trillion. Despite the high deficit, however, the U.S. continues to get the highest possible ratings on American bonds. He said that while he’s concerned with the amount of the debt, it’s the government’s ability to service that debt that really matters.
Snaith cited the economic crisis in Greece (which began in 2008) as an example, noting the cause was the country’s inability to service its sovereign debt owed to the European Union (EU). To avoid default on the debt, the EU loaned Greece enough money to continue its payments; now the repayments for that bailout will take decades.
He added that another factor that may be weighing on the economy and slowing expansion is the rapid growth of regulations. “Some regulations make sense,” Snaith explained, “but you have to weigh the benefit of the regulations against the cost. I think revisiting Dodd-Frank and other regulations make sense. To me, that is the secret sauce of economic growth.”
Providing an update on Florida’s residential real estate market, Florida Realtors Chief Economist Dr. Brad O’Connor agreed, and he anticipates a robust outlook for the state’s housing market. He noted that in-migration to Florida from other states remains strong, with the five top origin states being New York, Georgia, Virginia, Pennsylvania and New Jersey, respectively. In fact, that in-migration to the Sunshine State helped to drive increased home sales in 2018, picking up the pace from a 9% drop in home purchases in the state by international buyers.
“It was exciting to see the almost 6% growth (5.9%) in closed single-family sales in 2019 from 2018,” O’Connor said. “Florida topped over $100 billion (total of “$101.9 billion) in volume in home sales last year, up 8.3% from 2018; for condo-townhouses, we reached $31.6 billion in volume, up 1.8% over the 2018 figure.”
Unfortunately, he added, new listings for single-family homes and condo-townhouse units remained tight in 2019, with single-family homes down 11.4% and condo-townhouse properties down 9.7% compared to 2018.
“My final point: The median sales price still continues to rise, but looking at what the monthly mortgage payment is, that’s still a lot lower due to current historically low mortgage rates,” O’Connor said. “And that continues to drive sales and makes it a good time to buy.
“Overall, I think we can expect to see a similar amount of price appreciation over the coming year, at about 4%, and I think we’ll see a similar amount of growth in closed sales for 2020 at about 4%.”
The event concluded with experts addressing supply-side dynamics for new construction and development. Moderated by Jennifer Quinn, economist and director of economic development for Florida Realtors, the panel included Kristine Smale, senior vice president, Meyers Research; Matt Orosz, president and owner, Hanover Family Builders; and Brad Fess, founder of NuDesign Builders.
According to Smale, the three main factors constraining the supply side of new house are: higher construction costs, which moderated slightly in 2019 but are expected to rise again in 2020; a shortage of labor – 2019 had the largest amount of construction job postings since the Great Recession; and a lack of available, affordable land supply.
“Far and away, for us, it’s land – land availability and all the intricacies involved with that,” Orosz said. “From our perspective, especially in Central Florida, what is holding back growth and the market is local land supply, impact fees and land costs.”
As a remodeler, Fess said they face a slightly different problem, and that’s finding in-fill lots in very developed areas or homes to remodel for clients who want a smaller “jewel-box” home that still has all the amenities and custom, high-end finishes.
The title sponsor for the 2020 Florida Real Estate Trends was the Realtors of Broward, Palm Beaches and St. Lucie; co-sponsors included the Orlando Regional Realtor Association; the Realtor Association of Sarasota and Manatee; the Royal Palm Coast Realtor Association; the Realtors Association of Citrus County Inc.; and the Naples Area Board of Realtors®.
December saw significant increases in sales of Single Family and Condo/Townhouse Properties across both Manatee and Sarasota Counties. But sales of both property types in Sarasota County far exceeded those in Manatee County.
Single Family Homes sales saw double-digit growth.
During December, sales of Single Family Homes in Manatee County grew by 24.9% over the same period last year, accounting for 628 closed transactions. But this strong result paled in comparison to the 853 transactions closed during December in Sarasota County. That's a whopping 61.9% increase over December 2018 and more than a third over comparable sales in Manatee County. In all probability, price had a significant part to play in these results as the Median Sale Price of Single Family Homes sold in Manatee County during December rose by 5.2% over last year, while the Median Sale Price of similar properties in Sarasota County fell by .7%. The Median Sale Price of Single Family Homes in Manatee County stood at $325,000 while the price Sarasota County was $283,000, a difference of $42,000 lower.
Sales velocity continued to increase in both counties as well. In Sarasota County, the Median Time to Contract decreased to 33 days from 41 days last year, a decrease of 19.5%. While not as dramatic as Sarasota County, the Median Time to Contract in Manatee County fell by 4.1% to 47 days.
Declines in inventory was also seen in both counties during December. There were 1,996 Active Listings of Single Family Homes in Manatee down from 2,204 in the previous for a decrease of 9.4%. Sarasota County saw a similar decrease with only 2,790 Active Listings, down 11.4% from December 2018. These decreases are even more pronounced when converting Active Listings into Months Supply of Inventory. Here, Sarasota's supply of Single Family Homes Active Listings translated into a mere 3.7 Months Supply of Inventory, a whopping 22.9% decrease over the same period last year. Over in Manatee County the Months Supply of Inventory fell to 3.5 months resulting in a 14.6% decrease over last December. With the Months Supply of Inventory between 3.5 and 3.7 months, we can say that both counties are currently in a Strong Sellers' Market.
You may download the full reports by clicking on the appropriate graphic.
Sales of Condos and Townhouses mirrored Single Family Home Sales in both counties.
December was a good month for Condo and Townhouse Sellers, particularly in Sarasota County. Sales increased to 192 units in Manatee County registering a healthy 4.9% increase over last December. However, sales of these properties in Sarasota County continued to astonish with 310 units sold, a very strong increase of 29.2%. And while the Median Sale Price marginally increased in Manatee County (2.9%), Sarasota County saw the Median Sale Price climb to $271,945, a dramatic increase of 23.6% over December 2018.
Sales velocity for these properties continued to quicken in both counties during December. The Median Time to Contract in Manatee County was 47 days, down just 2.1% from the previous year. However, in spite of the dramatic increase in the Median Sale Price, the Median Time to Contract for these property types in Sarasota County plummeted to just 42 days, a decrease of 12.5% over December 2018.
There is a similar story to be told on the inventory front. The number of Active Listings for Condo/Townhouses in Manatee County fell by 16.5% in December to just 776 listings. Sarasota County saw a much more dramatic drop in inventory with 1,296 Active Listings, down from 1,893 listings a year ago. That's a 31.5% decrease in inventory.
These same dynamics are evident when translating these results into Months Supply of Inventory. During December, the Months Supply of Inventory in Manatee County fell by 10.0% to arrive at a 3.6 month supply. But this same statistic in Sarasota County fell by 29.1% over December 2018 to arrive at just a 3.9 month supply. These are remarkable results when you consider this time last year the Condo/Townhouse market in Sarasota County was in a weak Buyers Market, yet today finds itself in a moderately strong Sellers Market!
Like we said before: "The Time Is Now".
The market is rapidly increasing in strength. Inventory is becoming tighter and prices are increasing. Sellers should be prepared to list their properties now while demand is high. And Buyers should jump into the market in order to avoid future price increases and constrained choices. We have been saying for some time that the time to act is now. So give us a call today at (941) 840-2265 so that we may discuss your real estate plans further.
4th Quarter Survey Confirms Trends Seen in Manatee and Sarasota Counties
The National Association of Realtors (NAR) recently reported the results of a nationwide survey conducted during the 4th quarter of 2019. In it they found some results which are validated by the dynamics we have regularly reported on the current real estate market in Manatee and Sarasota Counties.
The key findings were:
Almost 2 in 3 Americans (63%) think it's a good time to buy a home. And one-third of the those surveyed strongly hold that belief.
But on the selling side, 3 out of 4 (74%) think it's a good time to sell.
NAR's chief economist, Lawrence Yun, attributes these strong positive sentiments to a strong job market combined with favorable economic conditions.
Until recently the mobility rate of homeowners has been relatively low as more people were opting to stay in their homes. So this recent survey suggests a change in attitude fueled by lower mortgage rates and a positive outlook for the US economy. Dr. Yun added that with the current conditions "..the timing is indeed ideal for those who want to enter into homeownership and for those looking to move on to their next home".
Survey Results by Age Group
Sentiments on whether it is a good time to buy varied only slightly between age groups. Respondents born between 1925 and 1945 were most likely to state now is a good time to buy (73%) while baby boomers (born between 1945 and 1964) overwhelmingly viewed the market favorably in terms of being a good time to buy (70%).
Most Respondents Expect Home Prices to Rise
Respondents were also asked to share their expectation over the next six months. The were results were as follows:
41% predict that prices will remain the same
48% said that they expect prices will rise
Only 11% felt home prices would fall
Millennials were most likely (47% of respondents) to believe prices will rise in their communities. And perhaps more importantly, people living in the South had the highest number of residents who said home prices would rise in the near term.
The Time To Act is Now!
The overall message found in this survey should be clear: in a market buoyed by strong consumer confidence, prices are set to rise. So if you are considering buying a home this year, you should have a plan to start looking now! We can certainly assist you with your search as this website contains a number of advanced tools for finding the best resale and new construction homes. Give us a ring today at (941) 840-2265 and we would be happy to walk through these tools with you.
Good News from the Florida Association of Realtors
The New Year rang in with two pieces of good news that should help keep Manatee and Sarasota County Buyers and Sellers in a festive mood.
Consumer Sentiment Increased in December
The Florida Association of Realtors (FAR) reported last week that the December Consumer Sentiment index rose to 100.1 from the 99.4 reading in November. The index, developed and maintained by the University of Florida at Gainesville, consists of 5 components to measure opinions of current economic conditions as well as the outlook for future conditions. Three of these components were up in December and two decreased.
Florida Consumer Sentiment has been increasing throughout 2019 with April 2019 reporting the highest level in the last 17 years. And the UF Bureau of Economic and Business Research suggested that economic indicators have remained very favorable throughout 2019 and the prospects for 2020 are encouraging. This is being driven by a strong labor market that continued to strengthen through 2019. In November for instance, 271,400 jobs were added statewide compared with a year ago, an increase of 2.5%.
Long-Term Mortgage Rates Continue to Ease
Last week, the US long-term mortgage rates fell slightly. Freddie Mac reported that the average rate for a 30-year Fixed Rate mortgage decreased to 3.72%, down from 4.51% a year ago. These rates continue to hover near historic lows.
It's a Good Time to Consider a Move
Optimistic consumer sentiment buoyed by a strong economy increases the likelihood of accelerating real estate decisions. Buyers, confident in a positive outlook for the economy and attracted by lower mortgage rates are prone to enter the market rather than deferring a purchase. Sellers will benefit by an increase in home prices and demand. So if buying or selling real estate is on your radar for 2020, give us a call and we would be happy to assist you in developing a plan. Call us today at (941) 840-2265.
Manatee and Sarasota Counties Single Family Home Sales Post Strong Results for November
Summary of the Market
Sales of Single Family Homes in Manatee and Sarasota Counties posted healthy gains during November. Sales of Condo and Townhouse properties during this period continued to languish. Inventory for both property types and counties declined dramatically pushing all markets into strong Sellers' Market territory.
Growth in Sales of Single Family Homes in Sarasota County doubles comparable performance in Manatee County
Continuing a trend we have observed during the past quarter, the percentage growth in sales of Single Family Homes in Sarasota County far exceeded that experienced in Manatee County. Single Family Homes sales in Sarasota County increased 23.6% over November of 2018, while Manatee County reported an increase of 10.9% over the same period last year. However, in absolute terms, more units were sold in Manatee County (550 units) than in Sarasota County (267) during this period. Prices for Single family homes were firmer in Manatee County as the Median Sale Price increased by 2.1%. This is in contrast to Sarasota County where the Median Sale Price actually fell 6.7% over November of last year. Discounting was slightly higher in Sarasota County as well with the Median Percentage of Original List Price Received was 95.8% an increase of 0.1% over November of 2018. This same statistic in Manatee County during the month was slightly higher coming in at 96.0% also up from last year by 0.6%.
Sales velocity for Single Homes Homes was stronger in Sarasota County as well with the Time To Contract reported as 37 days (down 2.6%) versus 43 days in Manatee County, a decrease of 14.0% over November 2018.
Inventory of existing Single Family Homes fell in both counties during November by virtually the same percentage. Manatee County reported 10% Active Listings during November of 2019 with Sarasota County reporting a decrease of 10.2% over the same period. When translating these inventory numbers into Months Supply of Inventory, we see Sarasota County reporting just 3.9 months supply on hand, a dramatic decrease of 17.0% over last year. Manatee County reported a steep decrease as well with only 3.5 months supply on hand, a decrease of 14.6%. With less than 4 months supply of inventory available, the market for Single Family Homes in both counties is now considered to be in the midst of a strong Sellers' Market.
As always, you can download the full reports for each county by clicking on the appropriate graphic.
Condo/Townhouse sales during November continued their decline
A combined total of just 398 Condo/Townhouse properties sold across Manatee and Sarasota Counties last month. The decrease was more pronounced in Sarasota County with 26.9% fewer units sold during November of 2019 than in November of 2018. Manatee County posted similarly dismal results with a decease of 19% over last year. But there was good news on the pricing front. The Median Sale Price of these properties increased 11.9% in Manatee County to $207,750. There was similar good news in Sarasota County with Median Sale Price increasing to $244,745, a jump of 6.9%.
But there was a stark divergence in sales velocity during this period. The Median Time to Contract for these properties was 46 days in Sarasota County, a decrease 6.1% over last year. This is in sharp contrast Manatee County where the Median Time to Contract was just 31 days, a huge decrease of 32.6% over November of 2018.
Inventory of Condo and Townhouse properties dropped in both counties during November. The number of Active Listings in Manatee County was 196 units, a decrease of 14.5% over the same period last year. While reporting higher units - 1,362 Active Listings - Inventory of Condo and Townhouse properties in Sarasota County fell in November by 24.8%. The Months Supply of Inventory of these properties decreased in both counties during November with Manatee County reporting a 7.5% decrease in the number of months supply and Sarasota County posted a massive 17.6% decrease over November 2018. These results place the market for Condos/Townhouses in a strong Sellers' Market.
Remember, you can download the entire report for each property type and county by clicking on the appropriate graphic.
Enjoy The Holiday Season!
The demand for Single Family Homes in both counties continues to be propelled by mortgage rates holding steady at around 3.75%. Inventory for all property types in both counties fell in November portending a tighter market in the near term. We will continue to monitor the markets and diligently provide insights for you.
With the holidays upon us, we'd like to take this opportunity to thank you for following our blog and wish you, your family and friends a Merry Christmas, a Happy Holiday and a prosperous, healthy New Year.
Outlook for Continued Growth, Moderating Price Increases and No Recession
Last Wednesday, the National Association of Realtors (NAR) convened a first ever Real Estate Forecast Summit. Held in Washington, DC, this meeting included top economists from around the nation including Florida Realtors Chief Economist Dr. Brad O'Connor.
The general consensus was that the economy will continue to grow and that real estate prices will continue to rise although at a slower pace. The following are several of the Macro Economic Forecasts for the US economy held by the attendees:
29% probability of a recession in 2020.
Gross Domestic Product growth of 2.0% in 2020 and 1.9% in 2021.
Annual unemployment rate of 3.7% next year with a small rise to 3.9% in 2021.
Outlook on interest rates
When asked about the forecast for interest rates 69% of the economists predicted that rates would not change in 2020.
Sales Growth Beats 2019 Predictions
Dr. O'Connor pointed out that his 2019 forecast for growth in homes sales of 1-2% was far exceeded by the actual sales. O'Conor reported a 4.3% growth in Single Family homes growth during 2019 with sales of Condo and Townhouse properties decreasing by about 2%. Overall the actual growth rate came in an aggregated 2.4% across both property types. NAR's Chief Economist Lawrence Yun stated that "Real estate is on firm ground with little chance of price declines."
The time to plan is now
In summary, 2020 is shaping up to be an exceptional year for real estate. So if you're thinking of buying, selling or investing in real estate next year, give us a ring to discuss your plans. We would be happy to lay out a strategy that will help you make the most of the market. We can be reached at (941) 840-2265.