Demand and supply conditions for Longboat Key Condos seem better than for Siesta Key Condos, especially for Bayside units. (By Raul Elizalde, 10/06)
Building up on last week’s newsletter, this month I take a look at condos in Siesta and Longboat Key.
Readers might recall that last month I showed how different price brackets of real estate in Sarasota show very different supply/demand conditions. In the aggregate, single-family Sarasota homes priced well below $1mm sell more often and have less competition than higher-priced homes. The interesting fact, however, was that at higher prices the relationship breaks down: more homes sell in the $2-2.25mm category relative to supply than in the $1.75-2mm bracket, for example. This finding reflects the much-larger supply of Sarasota homes at the lower range, while the volume of past sales is roughly comparable.
I also warned that these findings are applicable to all Sarasota County homes as a whole, but every area is different and hs to be analyzed on its own. Siesta Key and Longboat Key condos illustrate this point well.
Gulfside condos in Siesta Key and Longboat Key have a roughly similar pattern of inventory accumulation for prices below $1mm. On the basis of the last 12-month sales volume, both Keys have around 20 months of inventory. In the lower price ranges, both have a bit of a glut in the lower range (below $600,000). In the above-$1mm category, however, Longboat Key condos seem to be in a much healthier position than Siesta Key condos. Inventory at the higher price levels reaches the phenomenal 10-year worth of supply (around $1.1mm) on Siesta Key (see graph).
The situation for Bayside condos is much more dramatic, especially at the lower-price ranges. For the least expensive condos, Siesta Key exhibits a 13-year inventory load. In almost all categories, Longboat Key seems to be at a better position than Siesta Key.
What does this mean? I do not believe that condos currently for sale in Siesta Key, or for that matter anywhere in Sarasota, will take anywhere close to 13 years to sell. What this means is that, relative to the current inventory, little has sold in the last 12 months. The issue is now centered on lackluster demand more than oversupply.
I continue to believe that supply is no longer increasing at neck-breaking pace and that demand will slowly return in the next few months. How quickly demand returns, though, depends on many factors. Stable interest rates, a rising stock market and a general improvement of economic conditions may well set the stage for a more normal market in the months ahead. Siesta Key condo owners may want to watch the supply/demand conditions closely; buyers, on the other hand, may seriously consider making a move soon as these favorable conditions exist.
When it comes to knowing the Sarasota real estate market, Alison and Raul Elizalde have the expertise and knowledge to help you see where you stand when negotiating your real estate transaction, whether you are buying or selling a property. 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. Alison and Raul have been named Best in Customer Satisfaction by an independent research company.
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