Q1 2016: Sarasota’s Real Estate Market Shows Promise Despite Global Volatility

While the number of sales dipped a mere 1% over the prior year, the dollar volume of real estate that changed hands increased this past quarter.

Dueling factors affected Sarasota’s real estate market during January, February and March of 2016:

• The stock market went from some of the lowest levels in the past two years to some of the highest levels condensed into just 90 days. The high points create more buyer confidence.
• The presidential primaries have been the source of much debate, and also potentially create the perception of uncertainty. This can detract from buyer confidence.
• The price of gas has risen 23% during this time period. Lower prices at the pump kept money in people’s pockets that could be used elsewhere. That can potentially impact savings and spending.

The Luxury, Affordable and Distressed … Oh My!

In the Sarasota luxury market, those properties listed for $1M and above, sales increased by 35% over the same period a year ago. I continue to believe as Sarasota’s natural and cultural amenities gain more and more recognition, our city is able to compete at the national and global level against other popular Florida brands.

The distressed market tumbled to ½ of what it was during the first quarter of 2015. It is now only 10 % of the total market. The good news is that there are many more properties that have positive equity. There are also neighborhoods where the current values are still significantly below the sales prices at the peak. There can be major price differences even within many of Sarasota’s more desirable neighborhoods.

The affordable market (properties selling for $200k and less) is shrinking, although it still accounts for 42% of unit sales in our market. It contracted by 22% from a year earlier. This is a sign that prices are going up

I look at the real estate market on a quarterly, rather than monthly, basis as I think it provides a more balanced look at the local economic dynamics. This tends to even out the effects of weather events, currency fluctuation, global crisis, etc.

The real estate market here in Sarasota is healthy if your metrics are increasing prices and units sold. But we must not be complacent, new residents to Sarasota and long-time property owners need to advocate for their community to aim higher for an even quality better life here. I will discuss this more in next month’s newsletter: “Dr. Seuss’s Advice on Sarasota’s Real Estate Market and Schools.”

Any questions? Call me at 941.587.0740. 🙂

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