In tune with the general nationwide trend, prices for Sarasota real estate also reached a new record in May. The median price also broke the US$400,000 barrier but showed no sign of putting buyers off as demand remains strong. However, supply continues to fall short and many would-be homebuyers are disappointed.
Record median sales price in Sarasota
Data for May from the Realtor’s Association of Sarasota and Manatee (RASM) found that the median sales price in Sarasota County stood at US$407,000. The figure represents a new record and is the first to exceed US$400,000. In addition, it’s 36.6% higher than May 2020.
Sarasota County in Southwest Florida is currently experiencing the same boom as other areas in the Sunshine State. The May figures reflect the robust state of the Florida real estate market generally and mirror the trends seen in April.
No signs of fewer buyers of Sarasota real estate
Despite the recent price hikes, real estate in Sarasota County continues to attract buyers from across the country. “Regardless of the recent price surge, Florida real estate remains on par or less expensive than other markets,” said Alex Krumm, President of RASM.
Krumm pointed out that property prices in Southwest Florida give buyers from outside the state the “flexibility to pay more for a home while remaining relatively inexpensive compared to their previous place of residence”.
Record low inventory in Sarasota
Supply for Sarasota real estate also mirrors the general national trend, lagging well behind demand. Specifically, in May, inventory levels dropped by 74.6% in Sarasota County and Manatee County.
This translates to rock-bottom listings. There were just 620 single-family homes in Sarasota and a mere 462 in Manatee on the market last month.
In terms of month’s supply, inventory levels have plummeted in the year. In May this year, the single-family home supply dropped by 78.1% to just 0.6 months compared to 12 months ago. Condo property inventory fell even further (84.4%), leaving the market with a mere 0.7 month’s supply.
Faster selling time
As well as driving prices ever higher, demand is also reducing the time properties in Sarasota and Manatee spend on the market. According to RASM, the median number of days it takes for a property to go under contract is now less than a week for single-family homes. Figures for May show that six days were all it took for this property type to find a new owner.
Condo and townhouse properties took slightly longer. However, the nine-day average is still well below what the market is generally used to.
The contrast with 2020 is extraordinary. In May last year, single-family homes in Sarasota were on the market for around 35 days. Condos and townhouses took an average of 43 days.
Sarasota market moving forward
The continued increase in prices on the back of ever-stronger demand and shortage of inventory has been driving the US property market since summer last year. However, analysts believe that this trend will not carry on indefinitely.
Krumm points out that the current scenario is “a strong seller’s market” but cautions over expectations of similar patterns for the rest of the year. More properties are gradually coming onto the market – newly-listed single-family homes in both Sarasota and Manatee grew by 27.1% in the year to May.
“Owners waiting for top dollar may be disappointed when the number of properties available for sale eventually starts to rise,” he said. “With more options available, buyers will be less willing to meet sellers’ terms.”
Build-to-let in Southwest Florida
However, even when supply does start to rise, the shortfall in housing across the US will remain. New construction has historically failed to keep pace with demand as the number of households grows.
One solution favoured by many families while they wait for the right moment to buy is to rent a property. This option opens up the market potential for build-to-let properties, particularly in sought-after areas such as the Gulf Coast in Southwest Florida.
(Source: RASM)
