Pending sales were once again strong, hitting 857, but were slower than April 2010. The March and April pending sales figures both topped 1,000, and reflected a last minute rush to beat the federal homebuyer tax credit deadline.

The median sale price for a single family home was also trending higher at $169,000, up 8.4 percent from last May's figure of $155,000. For the last 12 months combined, the median sale price for single family homes was $165,000. For condos, the median price was $184,500, slightly higher than last May's figure of $181,000, while the median sale price for condos over the last 12 months was $192,000.

The pace of sales quickened for single family homes, with the average days on market dropping to 168, from 195 days last May. For condos, the figure stood at 213 days, slightly higher than last May's figure of 203 days.

The level of sales of distressed properties (foreclosures and short sales) rose slightly in May 2010 to 40 percent of the overall market, from 38 percent in April 2010. The distressed market topped 48 percent in late 2009, so the overall trend remains downward - a good sign for a market returning to normal.

The property inventory level remained steady in May 2010 at 6,094, which is the lowest level since late summer of 2005. The months of inventory for single family homes in May 2010 dropped to 7.2 months, the number of months it would take to sell all available homes at the current pace. This was a significant drop from May 2009 - 14.3 months - and very near equilibrium. For condos, the figure fell to 9.7 months, much lower than last May's figure of 19.0 months. Once the market reaches the 6 month level it is considered to be in equilibrium between a buyers and sellers market.

Median sale prices in Sarasota rose in February for condos, while falling slightly for single family homes. The median sale price for a single family home was $150,000, down 4% from January, but up 5.6% over last Feb. For condos, the median price rose to $169,000 up from last month's $165,000, a 2.4 percent increase. This time last year the median sale price for condos in Sarasota was $198,000. The median sale price for single family homes for the last 12 months was $160,000, while the median sale price for condos across the same period was $185,000. 
 
Short sales and foreclosures accounted for 47% of the overall market in February of this year, much the same as January's 48% mark. The high percentage of short sales and foreclosures in Sarasota continues to be the single biggest factor holding down median sale prices.
 
The property inventory level fell slightly in February to 6,329. Down only 13 units from January's total of 6,342, which remains at the lowest levels we've seen since the summer of 2005.
 
The months of inventory for single family homes was 10.6 months, a drop from last month's 11.5 months and far lower than the 24.1 months in February 2009. For condos, the inventory was 15.4 months, slightly higher than the 14.7 months reported in Jan. and far lower than the 28.4 months of a year ago.  For comparison, a 6 month inventory is considered by most analysts to be a "healthy" real estate market.
 
The first-time homebuyer tax credit and it's extension for current homeowners having been in their home for 5+ years expires at the end of April. That deadline will likely drive some activity in the Sarasota market in the coming month as potential homeowners scramble to get a contract approved before the end of the month. Those credits are essentially free money for home buyers (in most cases) totaling $8,000 and $6,500 respectively. If you're interested in taking advantage of the tax credit give me a call and I'll be happy to assist you.

-Roger Pettingell

“If the improving real-estate market on Longboat Key and Sarasota’s offshore keys the last five weeks in 2009 and the first five weeks in 2010 is any indication, the future may bode well for our “living industry.”

There were 110 transactions involving $94,985,070 in those 10 weeks. Sixty-two were transacted between Nov. 30, 2009, and the end the year for more than $50.2 million, and 48 were transacted during the first five weeks of 2010 for more than $44.7 million.

The largest sale was the $8.4 million new home sale on New Pass the last week in January to boost the week’s sales to more than $20 million. This compares to the best week of $18 million posted from Nov. 30, 2009, through Dec. 4, 2009.”
 
I’ve participate in many of these sales, including contracting on a $5.4 million Bird Key home, two Sanctuary residences with a combined value over $3 million, and the listing a selling of a $1 million Pierre residence.  Showings have been bit slower in the first two weeks of February, perhaps due to the unseasonably cool weather.  Buyers who are out looking are noticing greatly reduced inventory, particularly prime locations.  That coupled with the threat of rising interest rates will likely continue to drive the market.

Click Here To View The Latest Sarasota and Longboat Key Real Estate Trends 

I like to look at things differently.  I look around myself, and am thankful each day that I live in a real paradise.   Wonderful weather, the Gulf of Mexico, the Bay.  A culturally rich community which is generous to its citizens.  (Of course it doesn’t hurt that I have a happy, healthy family). 

Fluctuating markets have meant wonderful buying opportunities.  We are much closer to a real estate bottom than the top, and there is light at the end of this tunnel.  Though many consider the past year to have been a real estate disaster, many successful sales closed in 2009, and inventory is declining.  For example:

• Longboat Key active listings - 593       
• Bird Key active listings - 37
• Longboat key pending sales - 51        
• Bird Key pending sales - 7
• 2009 Longboat sales - 330      
• 2009 Bird Key sales - 35

I welcome 2010 and am looking forward to helping many Buyers and Sellers this year.  Times are changing, and we are changing with them.  Watch for my upcoming blogs to read about some of the new technology-based marketing concepts which we will be using in 2010!

I suspect the worst of the housing market is past us and the huge price drops we've seen in 2008 and 2009 are a thing of the past. Short sales will likely continue to rise as more homeowners are trying to save their credit by avoiding foreclosure. I wouldn't be surprised to see the government step in and pass legislation that requires banks to make drastic changes to their short sale processes which will streamline the loan modification, short sale, and perhaps even the foreclosure process for homeowners in distress. Those same banks may also begin holding on to more foreclosed properties and "flipping" them themselves to avoid the huge financial losses associated with foreclosing on a property and auctions.

Mortgage rates will most likely spike in March when the government puts an end to mortgage-backed securities. I expect that change will cause rates rates to go from the current 5% mark to around a 6% prime. The refinancing of properties will slow down en suite as the rates being offered will no longer be a substantial improvement for the majority of homeowners. Lenders will likely require significantly better credit scores to qualify for financing. My presage is that FICO scores will probably need to be around 700 for most  lending institutions.

Our local luxury markets will probably see less activity by potential sellers as more homeowners stay put waiting for the market to recover due to the higher mortgage rates compounding their losses. This will effectively cause a market stabilization because the decreased inventory in the Longboat Key and Sarasota communities will leave the buyers with less to choose from and in essence allow sellers to demand higher prices as the competition becomes more sparse.

If you have any questions about buying or selling in the 2010 real estate climate feel free to contact me and I'll be more than happy to speak with you at length about the opportunities available.

Home prices are one factor in determining your cost of ownership, but so are interest rates and financing availability. Even though interest rates have gone up in the last six months, they are still near historic lows. Since your monthly mortgage payment is a combination of paying down your principal and paying the interest owed, if home prices come down a little further but interest rates up, it could cost you even more to service a mortgage on an identical home!

While a home is a major investment, it is also the center of your personal life. It's important to live in a home that reflects your taste and values, yet is within your financial "comfort zone." To that end, it may be more important to lock in today's relatively low interest rates and low home prices, rather than to hope for a further break in prices in the future.

Please give me a call if I can be of any assistance in determining how much home you can afford in today's market.