2020 Real Estate Outlook: Expert Predictions for Mortgage Rates, Home Prices, Tech and More

December 17, 2019 by

Real Estate Outlook2020 Real Estate Outlook

The 2019 housing market has been one of low rates, high demand and limited supply—particularly on the lower-priced end of the real estate market.

Will 2020 be more of the same? According to experts, yes and no.

We spoke to six mortgage, real estate, and housing professionals. Here’s what they say is in store for the year to come:

Mortgage rates will stay low—or maybe go lower.

Mortgage rates currently sit at 3.75%, according to Freddie Mac’s most recent numbers—nearly a 1% difference from the monthly average a year ago. The drop in rates caused a surge in refinancing over the last few months, and purchase activity ticked up as well.

According to Odeta Kushi, deputy chief economist at title insurance and settlement services provider First American, there’s “emerging consensus” that rates will remain low next year—likely somewhere between 3.7% and 3.9%, she says.

Forecasts from Freddie Mac and the Mortgage Bankers Association back this up, both predicting 2020 rates within this range. Fannie Mae actually predicts rates will clock in even lower, vacillating between 3.5% and 3.6% throughout the year.

Sean Hundtofte, chief economist for online mortgage lender Better.com, says that thanks to these continued low rates, refinancing should remain a popular choice in the new year. And for homebuyers, he says, they’ll “be able to afford more house than they would have otherwise.”

Prices will keep on rising.

Home prices will continue their climb upward, according to experts, largely thanks to tight inventory and high demand.

According to the latest home price forecast from property data firm CoreLogic, home prices should tick up by 5.6% by next September—up from the just 3.5% jump we saw this year.

As Daryl Fairweather, chief economist for real estate brokerage Redfin, explains, “Right now we aren’t seeing a ton of new listings. Without more listings coming on the market, there will be more competition starting off in early 2020 and that will lead to more price pressure.”

The problem will be worse on the lower end of the price spectrum. According to Ralph DeFranco, chief economist for mortgage insurer Arch MI, entry-level home prices will rise higher than incomes next year—and disappointing construction numbers will only compound the issue.

“Low interest rates and a shortage of starter homes will continue to push up prices,” DeFranco said. “This is especially the case for lower price points, since builders have tended to focus on more expensive, higher-profit houses and less on replenishing low inventories of entry-level homes.”

It seems the price growth may continue beyond 2020, too. Data from Arch MI shows the chance of home price declines at a mere 11% for the next two years. There are currently no states or metro markets projected to see prices declines in that period.

Inventory will be tight.

Housing inventory is going to remain limited for much of 2020, experts say. And interest rates and record-high homeownership tenures are a big part of the problem.

According to recent data from Redfin, the average homeowner is staying in their home 13 years—up from just eight years in 2010. In some cities, homeownership tenures are as high as 23 years.

As Kushi explains, “You can’t buy what’s not for sale.”

“While historically low rates increase buying power and make it more likely for potential buyers to attain their homeownership dream, they also increase the risk of a long-run housing supply shortage, which we predict will continue through 2020 and possibly intensify,” Kushi says. “As first-time buyers lock-in these historically amazing rates and existing owners refinance—in droves in recent months, everyone will stay put and not sell. Where’s the incentive?”

There’s a chance that increasing construction may offer some relief in the inventory department. Last month’s residential construction report from the Census Bureau saw building permits and housing starts both increase over the year. At the same time. builder confidence was at a 20-month high, according to the National Association of Home Builders.

Still, it may not be enough to meet the needs of today’s buyers, Kushi says.

“As for building new homes, builders have a reason to be cautiously optimistic, given pent up demand stemming from a strong economy, lower mortgage rates and continued wage growth,” she says. “However, building pace still lags behind historical standards, and it will likely take months before we can begin building at a pace that will support the demand.”

Millennials will keep up their homebuying streak, while Boomers hold up inventory.

Data from Realtor.com shows Millennials made up a whopping 46% of all mortgage originations in September—up from 43% one year prior. Meanwhile, shares of Baby Boomer and Gen X mortgage activity declined.

It’s no wonder, either. Millennials rank homeownership as one of their top goals in life—higher than even marrying or having kids—and with interest rates low and incomes up, it’s the right time to buy a home for many.

Unfortunately, they face an uphill battle. As Kushi explains, “Looking ahead, Millennials may be entering a tougher housing market in 2020. A limited supply environment, combined with growing demand and increased competition for homes, is accelerating home price growth once again.”

The Baby Boomer generation is part of the challenge for this younger cohort, as many are choosing to age in place—keeping more homes off the market than ever before.

In fact, a recent study from Freddie Mac shows that if today’s older adults—those born between 1931 and 1959—behaved like earlier generations, then an additional 1.6 million homes would have hit the market by the end of the last year.

As Kushi puts it, “The fate of Millennial homebuying to close out 2019 and into 2020 will depend on two factors: if there is anything for them to buy, and whether rising purchasing power stemming from increasing income and historically low mortgage rates can continue to outpace house price appreciation.”

The suburbs will be a big draw thanks to Millennial demand.

As home prices skyrocket, cash-strapped Millennials are looking toward more affordable places to put down roots—namely smaller, suburban towns on the outskirts of major metros.

The trend has led to an uptick in “Hipsturbia” communities—live-work-play neighborhoods that blend the safety and affordability of the suburbs with the transit, walkability and 24-hour amenities of big cities.

Melissa Gomez, an agent with ERA Top Service Realty in New York, has seen the trend in action.

“Being based in the boroughs of NYC, I see Hipsturbia happening every day,” she said. “As cities like New York become increasingly expensive, younger people and families are looking for more bang for their buck with real estate, schooling and everything in between. And slowly but surely, it is breathing new life into small towns outside of major urban hubs.”

The Urban Land Institute recently named Histurbia as one of its top real estate trends to watch in 2020.

As the report explains, “If the live-work-play formula could revive inner cities a quarter-century ago, there is no reason to think that it will not work in suburbs with the right bones and the will to succeed.”

The industry will continue to digitize. 

The mortgage and real estate spheres have been moving away from their manual, paper-laden processes in recent years, and 2020 will only see that trend expand further—especially as more tech-savvy Millennials enter the market.

As Hundtofte explains, “In 2020, we’ll continue to see Millennials growing their share of the mortgage market, which in turn, will serve as a catalyst to lenders to continue to rapidly innovate their technology offerings to meet the expectations of an audience more accustomed to an Amazon, Venmo-like experience.”

Though plenty of tech offerings already exist—from e-signing and e-notary software to fully-digital mortgage applications, automated income verification and more—Hundtofte says we’ll probably see these solutions start teaming up in the new year.

“Rather than compete with each other, we’ll see companies combining technologies across the board, from startups partnering with startups to startups partnering with legacy institutions,” he says.

Aaron Block, the co-founder of MetaProp—a venture capital fund focusing solely on real estate technology—says to keep an eye on the Airbnb and WeWork brands specifically in this regard.

On WeWork’s recent IPO blunder, Block says, “One major positive outcome of this year’s ‘DiePO’ is the plethora of ‘proptech’ innovation talent hitting the street. Some exciting new companies are being formed as we speak.”

Forbes.com Nov. 15, 2019

 

Filed Under: Downtown Sarasota Real Estate, Florida Real Estate Market Tagged With: , ,

Sarasota Ranked No. 2 on Florida List of Places to Buy

June 13, 2018 by

places to buyIn a market seemingly awash in million-dollar sales, a national consulting company lists Sarasota-Bradenton the second metro area in Florida in terms of best places to buy a home versus renting.

Smart Asset, a financial technology company, ranks Sarasota 24th nationally on a list of break-even points for renting vs. buying. Cape Coral-Fort Myers came out on top in Florida.

Smart Asset looked at an average rent of about $1,500 for the area and an average mortgage payment on a typical home (4.5% interest, 20% down) of about $1,110 and determined it would take about two years, three months for renting to become more costly than buying.

Gary, Indiana was the nation’s top market, with break-even point at 1 year, four months. Washington, Nevada and California were the only states in whole deemed better for renters than buyers by the study.

Sarasota is in the midst of an upswing in sales and price appreciation, according to Michael Molton, a certified resident specialist broker-associate with Michael Saunders & Company, who writes a monthly report on the local market.

According to his most recent report:

  • The 2018 monthly year to date average for sold properties is 1,040 whereas the 2017 monthly average was 978 for the year and in 2016 the monthly average was 952.
  • The number of properties sold in April including both single family and condominiums in the Sarasota area was 1,200, which was 20 less than March and 26 more than a year ago.
  • In April, Sarasota’s single-family homes were sold at a median price of $285,000 vs. $272,500 a year ago, a 5% increase.
  • Condominium median sale price was $235,000 in April vs. $215,000 in April 2017.
  • Overall properties sold for 95% of the list price, a consistent ratio on a regular basis. The 2017 average for all properties sold was 95.6% of list price at the time of contract vs. the original list price.

Sarasota Observer June 13, 2018

Filed Under: Florida Real Estate Market, Sarasota Real Estate Market News Tagged With: , ,

Sales of $4 Million-Plus Homes Surging in Sarasota-Manatee

April 18, 2018 by

Sales of big homes for big bucks continue to be brisk in the Sarasota-Manatee real estate market. Latest sales trends show buyers’ search for value, waterfront and newer homes in current market.

Over the past six months, 28 homes and condominiums in the two counties sold for more than $4 million. Over the same six months in 2016-2017, only 10 properties were sold at that high price point.

 “These are impressive numbers,” Roger Pettingell of Coldwell Banker Real Estate said. He specializes in luxury waterfront properties in Sarasota and Longboat Key. Luxury homes are “moving really good,” he said. “It’s exciting, actually.”

 Others echo those views, citing the Sarasota-Manatee market’s value and attractiveness.

“It’s a really positive trend,” said Joel Schemmel of Premier Sotheby’s International Realty. “Hopefully, the market will continue to accelerate.”

 “These are starting to make us look like a real luxury market,” Pettingell said. And the market is still not overpriced, he said, unlike Naples and Palm Beach.

Brian Loebker, a Realtor with Michael Saunders & Co., called the high-end buyer interest “extremely strong right now.”

Amenities and Value

 “Our customers cite Sarasota as a location filled with amenities and value — you would pay double, or maybe triple, for the same home in other locations like Miami or Naples,” Loebker said. “The Sarasota luxury real estate market is commanding the highest level of interest and attraction in its history at this moment.”

Schemmel calls Sarasota a “destination market.”

Buyers continue to be discriminating in the properties they view, Loebker said. “There is zero tolerance for over-paying or even viewing properties which seem over-priced. The buyers are active, paying with cash, and willing to strike a deal immediately provided it is fair and just for both buyer and seller,” he said. “Any signs of greed or over-self-confidence, and the buyers will never view the property.”

The sheer number of $4 million-plus homes currently awaiting buyers may appear to be just as mind-boggling as the sales figures.

As of April 13, 103 homes were listed for $4 million or more in Sarasota and 19 in Manatee, including single-family homes, condos and townhomes, figures from My Florida Regional MLS indicate.

“The amount of inventory currently on the market over $4 million is not unusual,” Loebker said. “Actually, the overall inventory has been down from October through February, so to see about 100 luxury homes over $4 million on the market right now is on trend with previous years. The key is getting these homes priced right for the buyer pool.”

At the end of April 2017, big listings totaled 79 in Sarasota and nine in Manatee. Listings for April 2016 stood at 70 and 12 respectively, Trendgraphix shows.

Pending sales through the end of this April will likely drop the number of listings, said Jennifer Horvat, chief marketing officer at Michael Saunders & Co.

On water but not on grade

The Realtors pointed out two other trends in the luxury market. The cost of waterfront land “has risen substantially,” Pettingell said, but buyers are less interested in older homes at grade level on water. Properties listed for $1 million to $2 million that are not on the water are the slowest to move, Schemmel said.

A lot of the luxury buyers live in Sarasota but are upgrading their homes while older residents who want to live closer to relatives and community amenities are selling and moving off the islands, thus increasing the luxury-market inventory.

Schemmel added another element to the high-end sales surge: value as an investment. “For the first time in a long time, real estate in the portfolio is a good thing,” he said, and “a great hedge against inflation.”

That is somewhat apparent in one segment of the luxury market. “Sarasota has proven itself as an exceptional location to have a second, third or fourth home,” Loebker said.

Luxury homebuilder Ryan Perrone, president of Nautilus Homes, which specializes in projects that start at about $4 million, agreed that the local market is strong. “We have seen an uptick in interest in our product. It is hard for me to say whether that is just due to a gain in market share or whether it is a trend.”

A wider pool of buyers

The interest is coming from different parts of the country, too, broadening the pool of house shoppers.

“We have taken notice that while our city has been traditionally made up of Midwest transplants, there is a shift of people coming from California and the Northeast,” Perrone said. “I believe that this is because people from these markets are used to looking at those sorts of price points. In fact, those prices look like a deal when coming from L.A.”

Steve Murray, president of Murray Homes, is also seeing an increase in clients from California. Murray Homes is building six homes in the $4 million-plus price bracket, an increase over last year.

“We believe that this is in part due to the state income tax in those states, as well as the new tax regulations,” Murray said in an email. “In addition, our area is seeing an increase in nationwide appeal due to awards, marketing and high-end hotels bringing new visitors to our region.”

Murray echoed the view that Sarasota-Manatee homes represent value. “These clients are used to higher residential prices and so we are seen as a relative bargain when compared with Naples, Miami and their home towns.”

Sarasota Herald-Tribune, April 17, 2018

Filed Under: Downtown Sarasota Real Estate, Sarasota Buyers, Sarasota New Construction, Sarasota Real Estate Market News Tagged With: , , ,

Florida Report: 2017 Profile of Home Buyers and Sellers

January 22, 2018 by

Florida ProfileWhat does the typical Florida buyer or seller look like? Only 1 in 5 (22 percent) of buyers are first-timers compared to 34 percent in U.S., and they’re typically 45 years old.  On the other hand, the average seller is 60 years old, makes about $96,500 annually and owns a home that they think is too small.

The insights stem from the 2017 Profile of Home Buyers and Sellers Florida Report issued by Florida Realtors®with data compiled by the National Association of Realtors® (NAR) research department.

Report highlights

Florida Home Buyer Characteristics

  • In Florida, 22 percent of all buyers were first-timers. (Nationally, it was 34 percent.)
  • The typical Florida buyer was 54 years old and had a median income of $83,000.
  • 68 percent were married couples, 14 percent were single females, nine percent single males, and eight percent unmarried couples.
  • 15 percent of homebuyers purchased a multi-generational home.
  • 88 percent of recent Florida homebuyers identified as heterosexual, four percent as gay or lesbian and less than one percent as bisexual. The rest preferred not to answer.
  • 25 percent of buyers are veterans and three percent are active-duty service members in Florida. Nationally, only 18 percent of recent homebuyers were veterans.
  • At 26 percent, the primary reason for purchasing a home was the desire to own a home of their own.

Characteristics of Florida Homes Purchased

  • In Florida, 18 percent of first-time buyers purchased a new home and 82 percent bought a previously owned home.
  • Why wait for a new home to be built? In Florida, 34 percent wanted to avoid renovations and problems with plumbing or electricity.
  • Why buy a previously owned home? 34 percent were looking for a better overall value.
  • 79 percent of buyers opted for a detached single-family home.
  • 21 percent bought a senior-related home.
  • The median home price was $215,000 and 97 percent of the asking price.
  • The typical Florida home purchased was 1,800 square feet and built in 1996.
  • Overall, buyers expect to live in their homes for a median of 15 years.

The Home Search Process

  • In Florida, 42 percent of buyers looked online first and 22 percent contacted a real estate agent.
  • 81 percent found real estate agents very useful, and 83 percent said the same for websites.
  • Florida buyers typically searched for 10 weeks and looked at 10 homes. However, those who did not search the internet looked at six homes over three weeks.
  • Among buyers who used the internet, 86 percent found photos useful.
  • In Florida, 64 percent were satisfied with the buying process – a better report card for the state than the 61 percent satisfied nationally.

Home Buying and Florida’s Real Estate Professionals

  • 83 percent of Floridians (86 percent nationally) purchased their home through a real estate agent or broker.
  • Why work with a Realtor? In Florida, 56 percent said it was to find the right home.
  • 36 percent of Florida buyers (42 percent nationally) used an agent referred by a friend, neighbor or relative, and 12 percent used an agent that they had worked with in the past.
  • Seven in 10 buyers interviewed only one real estate agent during their home search.
  • Eighty-nine percent of buyers would use their agent again or recommend their agent to others.

Florida Sellers and the Selling Experience

  • The typical Florida home seller was 60 years old, with a median household income of $96,500.
  • In Florida, the top reasons for moving were retirement (15 percent), the desire to move closer to friends and family (12 percent) and a job relocation (11 percent).
  • Florida sellers typically lived in their home for 11 years before selling.
  • 90 percent of home sellers worked with a Florida real estate agent to sell their home.
  • For recently sold homes, the final sales price was a median 98 percent of the final listing price.
  • 33 percent of all sellers offered incentives to attract buyers.
  • 66 percent of Florida sellers were very satisfied with the selling process.

Sellers and Florida’s Real Estate Professionals

  • 63 percent of Florida home sellers found their agent through a referral from a friend, neighbor, or relative, or they used an agent they had worked with before.
  • 74 percent of recent Florida sellers contacted only one agent before finding the one they worked with to sell their home.
  • 93 percent of sellers listed their homes on the Multiple Listing Service (MLS).
  • 81 percent of sellers reported that they provided the agent’s compensation.
  • 34 percent of Florida’s sellers have recommended their agent to others at least three or more times since selling their home.
  • In Florida, 67 percent said they would definitely recommend their agent for future services, and 16 percent said probably.

Florida Association of Realtors January 2018

Filed Under: Florida Real Estate Market Tagged With: , , ,

Looking for a Strong 2018 Real Estate Market

January 19, 2018 by

2018 MarketSouthwest Florida’s residential real estate world is riding a winning streak, and current market conditions indicate continuing prosperity and growth. That’s the consensus evaluation of the robust home market in 2017 and the strong forecast for 2018 among industry insiders in Sarasota and Manatee counties.

Our informal survey panel represents the home-building and selling sides of the business. Their letter grades for this year’s residential market mostly fit into a tight and bright range — from B++ to A+.

“Residential real estate in Manatee, Sarasota and Charlotte counties, in all price points, all home types, continued its consistent momentum through 2017,” reports Michael Saunders, founder and CEO of Michael Saunders & Company, and Drayton Saunders, president. “Buyer demand has been consistently high and rising, inventory was strong and is expected to rise, and prices are seeing an appropriately steady increase.

“In general, it is a neutral market — neither favoring buyers or sellers in any significant capacity, therefore garnering an A-grade.”

Roger Pettingell, a perennial leader in luxury sales and listings and an associate with Coldwell Banker Residential Real Estate, agrees on a neutral market. “The stock market gains of 2017 are translating into strong cash buyers coming into the market. That said, sellers are also feeling quite confident, making for neither a seller nor buyer’s market (which makes a Realtor’s job more difficult!).”

Pettingell, based on Longboat Key, broke the $100 million sales mark for 2017 with a total of $104.6 million, leading the region.

“Using my business as a microcosm of the overall Sarasota market, I’d give this season an A+,” he said. “Not only was it a record breaking year for me, it was a record by 25 percent over last year. If that doesn’t deserve an A, I don’t know what does.”

Lynn Robbins, a Realtor with some four decades selling Sarasota homes and an associate with Coldwell Banker Residential Real Estate, views 2017 as “a strong sellers market.”

“My rating would be a B++ to A- … In my opinion, Sarasota has really been discovered, and the buyers are coming in larger numbers and we are seeing more of them in slower months,” she said.

Xena Vallone, broker/owner of Xena Vallone Realty Inc. and the outgoing president of the Realtors Association of Sarasota Manatee, broke the market in two. “I would rate 2017 residential as an A for sellers because of low inventory, which benefited them by higher prices, but most likely a C for buyers for the same reasons — low inventory and higher prices. I didn’t give it a D because I believe buyers are still getting some great interest rates.”

Lakewood Ranch-based homebuilder and developer Pat Neal of Neal Communities also enjoyed a stellar year. “Certainly 2017 would be an A or an A+. For our target customer (about 55 percent of whom do not have Florida as their address at the time of their first purchase), this has been a great year,” he said.

With 47 years in home construction and sales, Neal Communities has created some 70 successful communities throughout southwest Florida. To date, Neal has built more than 13,000 homes in the region. In 2017, the company built, sold and closed on about 1,168 new homes — topping the previous record year. Sales of new homes totaled $400 million, Neal noted.

Most of those homes — 80 percent — sold in the $250,000 to $500,000 range, the “Marvelous Middle,” as Neal describes the price spread, a range that Realtors find most appealing among buyers.

Across the Sarasota-Manatee-Charlotte market, moderately priced home sales — between $200,000 and $400,000 — “continue to be very strong,” Saunders said, with a 9 percent increase in pending and sold listings year-over-year and an 11 percent increase in the number of new listings over last year.

“Homes in this price range make up the largest segment of our market at 44 percent of total sales,” Saunders said. “With high demand and an average supply, this will force buyers to move quickly and possibly deal with multiple offer situations.”

In the midprice market — from $400,000 to $900,000, which comprises 15 percent of the market — new listings fell in 2017, sales dropped at the lower end and were flat at the higher prices. Sarasota proved to be the exception, Saunders said, with a 30 percent increase in pending sales in November.

Across the three counties, the residential luxury market — $1 million and higher, with sales representing 3 percent of the total market — went from fairly calm waters to a tsunami over the course of 2017. Closed sales were up only 4 percent in the first six months year-over-year, but surged a “staggering 61 percent from July to November,” Saunders said. Pending sales rose 18 percent in the first half of 2017, but soared a “staggering 59 percent” from July to November.

Despite the market hiccup brought about by Hurricane Irma in September, home sales rebounded quickly. Robbins certainly enjoyed autumn. “I was pleasantly surprised in October and November, which have been slower in the past, to find out that they were very busy months for me,” she said.

Multiple Listing Service data for the Sarasota-Manatee-Charlotte market confirm that point. In November, closed sales reached 546, an 8.8 percent increase from the same month a year ago. Plus, there were 677 new pending contracts, up year-over-year by 16.5 percent.

The Realtor Association of Sarasota and Manatee describes the current housing sector as a “healthy market” with combined numbers showing an increase in sales, new listings and prices.

The housing market across Florida also continued its positive streak in November, with more closed sales, more new listings, more pending sales and rising median prices, Florida Realtors data shows.

“In November, Florida’s housing market reflected the trends we’ve grown accustomed to seeing throughout this year,” said Florida Realtors President Maria Wells, broker-owner with Lifestyle Realty Group in Stuart.

The year ahead

The final months of 2017 created enthusiasm for 2018.

“I think the momentum which we are seeing, particularly in the last quarter of 2017, will move us forward with a strong 2018,” Pettingell said. “We do know that the real estate market has been in a recovery mode since 2011, and that no market goes up forever, but it looks like there is still plenty of room for further growth in 2018.”

Out-of-state buyers are key players in a strong market.

“Demand is rising, and we feel that it is going to be a busy season with more buyers here than ever before,” Robbins said. “We are seeing more buyers from California and New York than in past years.”

Neal concurs in regards to the market for new homes. He cites the Sunshine State’s broad appeal to out-of-state buyers as one reason the market is flourishing.

“People from Illinois, Michigan, Pennsylvania, New York and Connecticut are finding their way to Florida because of our good quality of life, beautiful environment, good economy and low taxes,” he said. “There has been much more awareness as to the economic advantages of living in Florida. That is, our good and growing economy and also the absence of a state income tax … or estate tax.”

Saunders, too, sees prospective buyers focusing on new construction. “Builders are still answering the pent-up buyer demand for ‘new.’ … Home buyers are electing to purchase a new home over an existing home because of upgrade options, new layout trends and hurricane-resistant materials and construction codes.”

Jon Mast, the chief executive officer of the Manatee-Sarasota Building Industry Association, spotted another current trend — “for new product in Lakewood Ranch becoming more desirable than resales of the same product, thereby lowering prices for same existing product in the Ranch. This will eventually level out over time.”

Saunders links the popularity of new neighborhoods to lifestyle options. “New construction will continue to push forward, especially in areas like West Villages in Venice and Waterside in Lakewood Ranch. The allure of new construction and communities with a plethora of amenities will be in high demand.”

The political climate could be a boon for Florida. With passage of the Tax Cuts and Jobs Act of 2017, the limit on deductible mortgage debt was dropped to $750,000 for loans taken out after Dec. 14. But the implication for Florida real estate lies elsewhere: The measure eliminates deductions of more than $10,000 in state and local taxes from federal tax returns. That could result in a major increase in the tax liabilities for people who itemize deductions and who reside in high-tax states — most probably upper-middle or upper class taxpayers. This, Saunders could bring “a surge of sales in Florida.”

Neal is more emphatic, anticipating a “positive impact” of the federal tax measure on Florida. A key reason is because Neal Communities’ “customers are typically not dependent on mortgage financing, they will not be affected by the mortgage limitations nor some of the limitations on deductibility,” he said.

“We seem to have a strength in the economy. The federal tax reform act will provide further stimulus.”

Neal cautioned against thinking another housing bubble is in the works. “We do not have the building we had in 2003-2006 … but only about one half of the housing production that we had in 2004 (in 2017).”

Another barrier to an overheated real estate market comes as a reaction to that financial crisis — stronger consumer protections. “As credit is so regulated,” Neal said, “I do not see a repeat of the 2003-2006 credit bubble.”

Hot spots

There is broad agreement that downtown Sarasota “is very hot,” as Robbins said, and “with all the charm of our downtown, great restaurants, things to do and close to the arts and Van Wezel, people want to live there and be able to walk to many of these attractions.”

Saunders echoes that sentiment: “Downtown’s residential construction explosion will be a great positive to the downtown commercial and retail sub-market. The growing live-work-play environment in downtown will remain a draw for people from all over the region.”

Besides Lakewood Ranch, the West Villages and the University Parkway corridor, other desirable neighborhoods “will be west of the Trail as buyers want to be close to the water,” Robbins said.

All the barrier islands will continue to be popular, especially Siesta Key with one of the best known beaches in the world. “There are numerous wonderful choices of condos in all price ranges there and one can walk to the beach,” Robbins said.

Herald Tribune December 2017

Filed Under: Downtown Sarasota Construction, Downtown Sarasota Real Estate, Florida Real Estate Market, Sarasota Real Estate Market News Tagged With: , , , ,

Sarasota April Real Estate – Both Ups and Downs

May 24, 2017 by

The overall reporting for April Real Estate indicates a lot of Ups.

Downtown Sarasota Real Estate

 

 

 

 

Closed Sales are Up. Median Single Family Pricing is Up. Days to Contract are Up. Inventory is Up.

So where’s the down? Median Condo Prices are Down, along with Average Sale Prices for Condos.

According to the recent numbers compiled by Florida REALTORS® from My Florida Regional MLS, April 2017 reflects an increase in single family closed sales, median sales prices and inventory in Sarasota and Manatee County as compared to April of 2016.

Closed sales in Sarasota County increased by 8.3 percent for single family homes, while Manatee County experienced a 1.5 percent increase. Condos, however, decreased in sales in the month of April. Sarasota condo sales decreased by 0.3 percent this month and Manatee decreased by 22 percent.

Median Prices

Median prices of Sarasota County single family homes increased by 9 percent to $272,500, while condos decreased by 1.4 percent to $215,000. Single family homes in Manatee County increased in median price by 5.4 percent to $295,000, while condos in Manatee increased by 2.1 percent to $170,500.

The number of properties that were put on the market during April decreased in both counties from last month, a good indication of the end of the season.

“This year’s season started slow in January, but picked up steam in February and March, leveling out again in April,” said Xena Vallone, 2017 RASM President.

Inventory of Homes for Sale

When looking at the total inventory in the two-county area, there is a 9.3 percent increase of active listings from this time in 2016, but inventory continues to be very tight, especially in lower price ranges.

In Sarasota County, the inventory of single family homes increased 12.3 percent and condos by 12 percent. Single family homes in Manatee County increased by 3.6 percent, while condos increased by 9.7 percent.

Days on the Market

In April 2017, we saw an increase in time to contract over last year in both counties. Sarasota single family homes increased to 45 days on market, up from 35 last year, and the time for condos increased to 46 days, also up from 35 days a year ago.

In Manatee County, time on market for single family homes increased to 46 days from 38 last year, while condos rose from 33 days last year to 50 days on market this year.

“Higher inventory levels typically increase the time it takes to sell a property,” said Vallone. “However, that is not the case for more affordable price points. Single family homes priced under $300,000 are going  to contract more quickly than those priced higher, but we aren’t seeing the same thing in the condo market.”

Months of Inventory

The month’s supply of inventory in the two-county area is in the range of 4.4 to 5.5 months’ inventory, continuing to improve year-over-year.

This statistic reflects the time it would take to sell all the active listings on the market at the current rate of sales.

The current supply favors the seller over the buyer overall, but not in all price ranges, as indicated above.

According to the National Association of REALTOR’s Midyear Forecast, supply, affordability and modest economic growth are holding back sales and threatening the nation’s low homeownership.  However, chief economist Lawrence Yun believes existing-home sales are poised to climb 3.5 percent in 2017.

“The housing market has exceeded expectations ever since the election, despite depressed inventory and higher mortgage rates,” said Yun. “The combination of the stock market being at record highs, 16 million new jobs created since 2010, pent-up household formation and rising consumer confidence are giving more households the assurance and ability to purchase a home.”

April Real Estate

Realtor Association of Sarasota and Manatee –  May 24, 2017

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