Sellers face a tough time today.(By Raul Elizalde, 1/06)
November and December have been tough months for sellers. The number of listings has gone up a lot, buyers are scarce, and the media has been relentless about putting out stories suggesting that “the bubble has burst”. But how bad is the market, really? And what is a seller to do?
Hard numbers show that, indeed, Sarasota County home sales have declined in November and December to the lowest level in four years. Looking at this chart , however, one would be very hard pressed to see the decline as part of a major trend. The number of units sold tends to be very volatile, and it is also seasonally low around year end.
A more important fact is that the number of homes on the market is now the largest seen in at least four years, after the inventory crunch that went on from 6/04 through 6/05.
On the other hand, the condo story is surprising. This chart shows that sales have remained relatively steady through the end of 2005 – volatile, but within a range. Like homes, the number of condos listed has gone up a lot, but in percentage terms the increase does not seem to be as large as for listed homes. So much for all the talk about the Sarasota condo glut!
The most interesting story comes when looking deeper into the numbers. This chart shows that the number of homes on the market priced below $1 million has exploded from the 600-700 units typically offered during the 6/04 – 6/05 crunch, to more than 2200 today. This is a 3- to 4-fold increase. The number of condos below $1 million has also more than tripled, from about 400 to over 1300 today.
On the other hand, this chart shows that the number of homes listed with a price tag above $1 million has less than doubled, from the 350-unit range to around 550 today, while the number of condos in that price range went from the 200-250 unit range to just above 300.
Given the state of the market right now, I come out with the following observations:
*For all the concern about a condo glut that the media has focused on, the condo market seems to be in very good shape in comparison to the single family home market, at least at this time.
*Luxury condos appear to be in a particularly good position, with steady sales and the lowest increase in.
*Would-be condo sellers who are concerned about the future might want to put their condos on the market now, while relatively favorably conditions exist. On the other hand, there are few reasons to believe that these conditions might worsen significantly in the near future.
*Single-family homes priced below $1 million are the most affected segment. Facing fierce competition, sellers are becoming concerned and impatient.
*Now more than ever, it is crucial to price a property right, make sure that it shows impeccably well, and market it professionally and through multiple channels. Gone are the days of overpricing a property to see if “somebody bites”, and of relying on a yard sign and an MLS posting as the full extent of marketing a property. Competition is just too strong.
When it comes to knowing the Sarasota real estate market, Alison and Raul Elizalde have the expertise to understand the value of a property and how to market it right. Our track record, added to the unsurpassed reputation of Michael Saunders & Company as the premier real estate company in Florida’s Gulf Coast, give you the peace of mind you deserve, whether you are looking to buy or sell a property.
Call us today at 941-350-7904 for a friendly and professional consultation, and visit our website, www.SarasotaProperty.info, for monthly updates on the Sarasota real estate market.
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