Category Archives: Uncategorized

Pending Report for November 4, 2017

This was a big week everywhere but none looking as big as downtown Sarasota. The figures for this year are distorted from 9 listings in the VUE closing this week and being entered in MLS for the first time.  In most large new construction projects, only a few sample listings are maintained in MLS. This keeps MLS manageable and from being overrun, so to speak, by a single building. If all of the VUE listings were entered from the project start, Zillow would be a mess with every other listing being in the VUE.

click here to download as pdf

When listings that were not previously entered in MLS eventually close, the listings are often entered in MLS at closing for agent/broker credit (as was the case with these listings). The listings still have to go through the same MLS progression. The contract date, listing date and sale date are entered the day of closing giving each the same date.  Undoubtedly all 9 of the new construction listings went to contract much earlier, perhaps even in previous years. Again, there is nothing wrong with this, you just have to be aware of it as you study the results. Demand Downtown was not up 1300% last week. (Another unavoidable side result of this is that the days on market stat will be ZERO for all such listings – be leery of any broker or agent including new construction sales in their quoted days on market performance).

Get ready for many weeks like this as loads new construction starts to close.

Another interesting thing to watch with regard to new construction closings, is how much of it ends up back on the market. I will try to highlight that for you.

Top Four Reasons Why You Can’t Sell Your Home

     (Or Why Your Home Didn’t Sell)

Before reading this article, I would recommend reading my blog post: “The 3 Biggest Changes the Internet Has Had on the Real Estate Industry.”

Even in the best of times, not all listings sell. Through the end of June 2017, over 1,250 residential listings have expired across Sarasota and Manatee Counties. If you are one of these sellers, then read on for a solution next time. If you are about to put your home on the market, reading this article might help you avoid a long, drawn-out fail.

Listings end without a sale for one or more  of four reasons, more or less in order of frequency:

  1. The asking price is too high
  2. The home does not show as well as it could (in disrepair, dirty, cluttered, etc.)
  3. Inadequate marketing
  4. Limited feedback and follow up

The Asking Price is Too High

Anyone can give away a home. Why should I pay a commission to someone that is just going to give the house away? You have to leave room to negotiate. What difference does the asking price make- people can always make an offer? All of these are old axioms that need to disappear into the abyss. I doubt that they were ever accurate and certainly aren’t now.

First, let’s talk about how high too high is. For starters, in the combined market of Sarasota and Manatee County for the calendar year 2016, the median sales price was a whopping 97.6% of the asking price. That’s pretty tight. On top of that, 32% of sales occurred at or above full price. So if you are priced $1 above the market value, you are overpriced compared to about a third of the market. If you are priced more than 2.4% above the market price, you are overpriced compared to half the market. Who will notice this? Don’t worry; only the prospective buyers will know. Read on.

Market price is usually estimated before you put your home up for sale by analyzing recent sales (not asking prices for homes that haven’t sold). The idea is to compare your home to those that sold and make adjustments for differences that would have a meaningful impact on market value, things like air-conditioned space, levels of upgrades/updating, view, number of bathrooms, etc. If the comps are selected correctly, the adjustments should net to a small number (less than 10% of the price). The larger the adjustment, the more difficult time you will have with price (the more difficult it will be to make prospective buyers see that same value).


Finally, consider that today’s buyer is probably the most market educated person in the room when it comes to the market for your home. If someone has been considering an offer on your property, then you can bet they have looked at dozens of homes online, seen many in person, and made countless comparisons between homes. If there is too much fluff in your price, at best, you will make other listings look like deals (see next section in this article), or at worse, they will never consider your listing because you have it priced out of their range (even though you would gladly sell it for a price in their range).

To recap, pricing high will not work, and there is no reason for it. As demonstrated in the data, buyers will pay at or above full price. You don’t need to lard up your asking price for any reason.

The Home Does Not Show Well

You can’t just blow this off, even in a great sellers’ market.  Builders spend hundreds of thousands of dollars staging a single home. They wouldn’t do this if it didn’t add to the bottom line. The good news is that you don’t have to spend much money. But you will have to devote time and elbow grease.

The idea here is not to spend thousands updating your home with the latest fads but doing common sense things that cost little and will add thousands to your selling price. Most home improvements do pay off, including ones you make right before selling.  Your home doesn’t need to look new and modern to sell, but it should be (and look/smell) neat, clean, and well-maintained. Maintenance is different than improvement. You don’t need to replace your 20-year-old laminate cabinets and counter tops with solid wood and granite. But the cabinet doors shouldn’t be hanging from one hinge and counter top should not be delaminating. Carpet is fine if it is stain free and not threadbare.

A must-read for anyone about to sell a home is Martha Webb’s book, Dress your House for Success. You can get it on Amazon for about $5.00. I could add nothing to what Martha has created in her book. So, rather than just repeat what she says, I will send you free her 13-page guide to dressing your house for success. Just visit scottnorris.com/order-your-copy-of-dress-for-success and order your free copy of Martha’s checklist. Enter your mailing address, as the checklist is copyrighted. I can only mail you an original (no email).

Inadequate or Ineffective Marketing

Most people, agents and consumers, know the internet is a popular place to search for homes and every listing should be on the internet. That assumption is correct, but there is much more to it.

Each year, the National Association of Realtors conducts a national survey designed to track trends in the real estate industry. The results are compiled and published in an annual report, titled “Profile of Home Buyers and Sellers.”  Consider these survey results from the home BUYER section from the 2016 report:

  1. How did you first learn about the home you eventually purchased
    • 51% – Internet
    • 34% – My Real Estate Agent
    • 8% – Yard Sign
    • 5% – Friend, Relative, Neighbor, Knew the Seller
    • 2% – Homebuilder
    • <1% – Print media, direct mail, open houses, all else
  2. Value of Website Features – % very useful
    • 89% – Photos
    • 85% – Detailed info about the home
    • 55%- Floor Plans
    • 50% – Virtual Tours

The biggest and, unfortunately, most common mistake made in marketing is the photography. You would think that, with pictures being the most helpful item to consumers, photography would receive the most attention 100% of the time. Yet, countless listings treat the photos like they don’t matter. Either the quality is horrible, critical shots are missing (like the view, even in waterfront listings you see this), or only a couple of pictures are provided. All listings should have the photography professionally shot and the maximum photos allowed should be uploaded. Cell phones or cheap digital cameras can never get the lighting right and don’t have a lens wide enough to shoot small rooms (you usually end up with pictures of furniture).

The next biggest issue is often half-hearted and hurried attempts to complete the listing, which leads to only the mandatory MLS fields being entered, with a couple of meaningless phrases entered in the public remarks section. Detailed information about the home is the second most helpful item on the list above. The MLS data is used to syndicate the listing across the internet. It needs to be completed and hit all the big selling features of the property. The public remarks section is critical because it will likely be read first.

The internet has made the yard sign a huge tool for sellers. For years, real estate agents have hung sign riders with a web address, where consumers can obtain pictures and other info about the home. However, current technology is to offer a number and property code on the sign that, when sent as a text by the consumer, will instantly deliver pictures and ad copy about the home to the customer’s smart phone.  No fumbling with a long URL; just text a 6-digit code to a 5-digit number and all the data and pictures are immediately texted to you, all while you are sitting in front of the home.

Feedback and Follow up

Feedback comes in a variety of forms. The best is from a conscientious agent that has just shown the home.  However, with the internet, everything is quantifiable. Each week provides little pieces of the puzzle in online showings, emails sent, emails opened, saved as favorite, number of showings etc. Looking at all these items each week will often point to some form of action required.

As you will read in the blog post referenced at the beginning of this article, the internet has sped up the sales cycle. By the end of the first 7 days, virtually everyone looking for a home like yours will know about it. By the end of 30 days, all interested enough to visit your home will have done so. Each week after week 2, your showings, online views, and calls will drop off significantly. Depending on the time of the year and the seasonality of your area, the decline in showings could be to where you receive more showings in the first month than you do the rest of the listing period combined. That’s why follow-up is so critical. If you are getting online views but no showings, showings but no offers, something is wrong. You need to reevaluate things quickly.

Tax Appreciation Rates on Longboat Key Condos

As in the Sarasota property tax article I posted last month, this post analyzes the change in the Property Appraiser-determined Just Values (market values before any exemptions or Save Our Homes cap) between 2015 and 2016 (latest available data). The Property Appraiser equates Just Value with market value. Since the valuations are always AS OF January 1 of the tax year, the change in value discussed relates to calendar year 2015 (the change in value that occurred between January 1, 2015 and January 1, 2016).  The 2017 valuation should be finalized later this year.

Also in the Sarasota post, I characterized the Property Appraisers valuation as good as any I could have derived, at least in a reasonable amount of time.  The Florida PA offices revalue every property every year using a mass evaluation technique.  The process is to assign a value to large sections of land and then use statistical techniques to allocate that value across individual parcels with each section. At first, the methodology sounds rough, especially compared to the typical Realtor® market analysis approach, where recent sales are analyzed and adjusted based on differences between the homes being sold and the subject property. Furthermore, the big swings in appreciation rates between buildings and across years in the schedule below cast doubt on the validity of using the Property Appraiser’s valuations for anything other than coming up with a tax bill.

However, consider that many condominium communities on Longboat don’t have a sale every year. In fact, of the 92 communities listed on the schedule below, only 70 had sales in 2016.  This means, for over 23% of the buildings, anyone appraising for any purpose would have to rely exclusively on sales in the surrounding area – much like what the PA office does. So wild swings or not, the PA calculations may be the best.

Whether the tax Just Value derived from the Property Appraisers’ approach is anywhere near the real market value is anyone’s guess. The same thing also can be said about the Standard & Poors/Case-Shiller numbers, generally the basis for all media reports of appreciation and taken as fact. They both are the result an estimation process.

In summary, the County PA offices figures (Just Value) are what I summarized below. I refer to the changes in value as appreciation as though it was a certifiable fact. You can make your own decision about the validity of calling this market appreciation. All references I make about appreciation here will be the year-over-year changes in Just Value.

Summary of Property Tax Just Value changes Longboat Key

The overall level of appreciation on Longboat Key condominiums during 2015 was 4.8%, down slightly from the 5.9% in 2014. Buildings on the west side of Gulf of Mexico Drive increased 5.2%, while those on the east side increased 3.7%. The Manatee end of the Key increased 8.6%, while the Sarasota end increased only 3.8%.

Other notes on the rate of change:

  • Condominiums in Bay Isles increased 3.6% or .8% better than other bayside communities on the Sarasota end.
  • Island-side condominiums in Longboat Key Club increased 2.2%, just a little more than half the average rate of all Sarasota-end communities on the west side of GOM.
  • The 2 age restricted communities changed as follows:
    • Case del Mar 8.3% or .5% points less than the average Manatee County west-side-of-GOM average.
    • Spanish Main 11.9% or about 4% points above the average Manatee County east-side –of-GOM average.

Percentage Change in Longboat Key Taxable Values by Condominium Building

This is the schedule I was referencing in the opening paragraph, regarding the variations between buildings and years. Some of the swings are hard to believe. Look at Harbour Links as an example.  In 2014, Just Values increased 56%, on average, in that community. The next year, they dropped 11%. It is hard to believe the market works this way.

Lonboat Key Changes in Tax Values by Buidling – click image to download complete list as 3 page pdf file

But it could. The only sale in Harbour Links during 2014 was for $425k, which worked out to $241/ft. The Just Value of this property on 1/1/2014 was $335k or $140/ft. The new valuation on 1/1/2015 came in at $596k or a 78% increase in Just Value.

To recap the history of this property:

1/1/2014   – Just Value is set at $317k ($132/ft)

6/19/2014 – sells for $425k ($177/ft)

1/1/2015    – Just value is set at $596k ($249/ft)

On the surface, it looks like the PA overshot the value. I am sure the new owner thought the same.

However, the next year (2015) saw 2 residences sell in Harbour Links for $576k and $528 ($241/ft and $334/ft), a range that makes the 1/1/2015 Just Value of $596/$249/ft for the 2014-sold-home seem more reasonable (effectively saying the buyer got a great deal).

 

 

 

 

 

 

 

 

 

 

 

Top 3 Ways the Internet Has Changed Real Estate Sales

Click here to subscribe to my newsletter and never miss a post 

Many people expected the internet would dramatically change the real estate industry and significantly lower real estate commissions. So far, this has not happened, nor really shown any signs of doing so. Still, the real estate industry has experienced a revolution, just not what was predicted. Here’s what’s happened so far.

The Internet Empowered the Consumer

First, the internet took considerable power from the hands of the brokers/agents and gave it to consumers. In the old days (up to the early part the 21st Century), if you wanted to know what was for sale, you had to call a real estate agent. If you drove past a home with a “For Sale” sign in the yard, you had to call the real estate office just to find out the asking price. If you wanted to make an offer, the real estate agent provided you with recent sales. If you were a seller during this period, you faced the same wall. The real estate agent shared the active listings and recent sales with you.

In every case, you had to trust you had a capable and honest real estate agent. One hundred percent of the information you received about listing availability, pricing, recent sales, and valuations all came from the real estate professional, and virtually all of it was unverifiable. I am sure the vast majority of the time customers received fair and quality information but equally sure there were varying flavors of quality, like everything else in the world.

Those days are over. Most buyers and sellers are well-informed about the market before they even contact a real estate agent. Active listings and recent sales, with photos, video, and considerable home and neighborhood data, are available on multiple real estate websites. Today, real estate agents and their customers have access to the same information. This means both parties to a real estate transaction (buyers and sellers) are also looking at the same data. Each party (buyer, seller, and real estate agents) may evaluate the information differently, but all the data is available to everyone.

The Internet Sped Up the Sales Cycle

Prior to the internet, real estate agents depended on direct mail and print advertising to get the word out about their inventory. Print advertising often took 1-2 weeks just to get the property in the local newspaper and maybe a month or longer to get the home into a home magazine. From there, there was a lag as buyers poured over the all the ads and identified the ones that appealed to them. Further, the information available was so thin, about the only action a buyer could take was to call the real estate agent. Most print ads (then and now) just have one small photo and two lines of text.

Price changes went the same way.  It took months for the entire buyer pool to get notified about a new listing or a price change that might put an existing listing within their reach.

Now, consumers sign up for automated listing updates through their agent or on their own with third party sites. Listings matching the customer’s requirements are emailed to the customer within minutes of being posted on MLS.  The listing information includes dozens of high resolution photos, video, pages of statistics and ad copy about the property and more. The result is that, within a week of entering the listing, the entire buyer pool is notified and fully educated about the listing. To get one customer this far along in the buying process 10-15 years ago took months.

The median days on market for a home (time between listing date and contract date) was just 47 days in 2016 for Sarasota and Manatee counties combined.  46% of all homes that sold, only required 30 days or less of marketing time.

The Internet Made Obsolete All Other Forms of Mass Media Marketing

The 2016 National Association of Realtor’s 2016 report, “Profile of Home Buyers and Sellers”, states 85% of home buyers said they first learned about the home they purchased either from the internet (51%) or from their real estate agent (34%). The yard sign accounted for another 8%, with friend, relative, neighbor, or homebuilder making up another 6%. That leaves 1% for newspapers, home magazines, open houses, TV, and direct mail. A few years ago, this “1%” constituted the entire marketing plan for the typical Realtor®.

The reason for print media’s disappearance is obvious. Relative to the internet, it has the following disadvantages:

  • Print media is not searchable. You can’t ask the newspaper only to show you homes under $500,000, for example.
  • It’s not complete. The Sunday ads only show a tiny percentage of all homes on the market.
  • The images are limited and poor (usually one in a print ad compared to 25 or more online, with video).
  • Print media is stale. Newspaper deadlines are close to a week and magazines may be over a month out.
  • Your only option to find out more about the listing is to call the agent. Online listings will contain most of the information the average person needs.

Implications for Sellers

If you are trying or about to try to sell your home soon, here is how these changes will affect you:

  • The amount and level of information available online is ideal for people that like to research a major purchase (that’s just about everyone). Most buyers are students of the market and often better informed than sellers. Today’s buyer is unlikely to pay you more than your home is worth. Pricing your home at more than it is worth will fool no one.
  • Plan on going to contract in 30 days or less. This is the new normal for the typical home because by 30 days, everyone in the market for your home will have a chance to see it. Many listings will literally receive thousands of online views during this period. After the initial 30 days, however, everything slows down exponentially. Now, you are only receiving views from new people entering the market, which is usually a fraction of the existing pool of buyers (everything comes in 1’s and 2’s). If your home hasn’t received at least 1 offer in 30 days, you need to take action, most likely, a price reduction.
  • Pricing your home has always been important, but now, it’s critical. And you don’t have to price your home high to get a good price. During 2016, 32% of all residential real estate that sold through MLS in Sarasota and Manatee counties did so at a price equal to or above the listing price. This also means pricing your home above market will make you look overpriced (or a poor value) compared to one third of your competition. Pricing your home at or just a few dollars above the market makes many people believe they are potentially “leaving something on the table”, a feeling amplified when they go to contract quickly. However, selling quickly no longer means you gave away your home. It means you sold into the largest audience you would ever have. It has to mean that you received the best price. If this initial pool of buyers didn’t like the value you were offering, what are the chances the next buyer entering the market will see it?
  • Internet marketing is much more passive than print advertising. Sellers often complain their agent is “doing nothing” because they don’t see the home in a print ad every Sunday or the agent is not holding an open house twice per month. Just know that, if all it took was two print ads or an open house to move a home, there wouldn’t be enough paper to print all the ads. Real estate professionals don’t favor these methods anymore because they don’t work (not for selling homes- building real estate brands, maybe). Same for open houses.

[CLICK HERE TO DOWNLOAD “Expired Listings- Don’t Become a Statistic“]

___________________________________________________________________________________________________

About Scott

For 45 years, Scott Norris has lived in the Sarasota/Manatee area and has watched it flourish into one of Florida’s most highly sought-after residential real estate markets. Through his myriad of business experiences, including being a licensed CPA, working for a Big 4 accounting firm and a large national retailer, and selling real estate in the area for over 16 years, Scott has accrued a unique cache of knowledge and experience that enables him to serve as a dependable, invaluable resource for his clients. His understanding of business and finance, his knowledge of the local marketplace, with his professionalism and relationship building skills provide Scott with the foresight to address issues proactively before they become a problem and provide him with the ability to take a multidisciplinary approach to navigating today’s complex real estate environment.

 

Scott Norris
Broker/Associate
Coldwell Banker Residential Real Estate
201 Gulf of Mexico Dr. Ste. 1
Longboat Key, FL 34228
941-545-8706
Scott@ScottNorris.com

Downtown Sarasota Pending Sales Up 40% Last 13 Weeks

Downtown Sarasota pending condominium sales are up 40% over last year for the past 13 week period. Existing home sales accounted for most of the increase, up some 36% over last year. New constructions sales for the past 13 week period were less than 10% of total sales

Longboat Key pending condo sales were up 13% over the past 4 weeks and 26% over the past 13 weels. Pending sales were down most of the season and worked their way back to even with last year by the end of April. Most of the increase came during June.

In the Lakewood Ranch area (not all homes in the 2 zip code area are in Lakewood Ranch) pending home sales were up 14% over last year for the past 13 week period. New home sales were flat  during this period so the entire increase came from resales. New construction pending sales are a much larger component of total sales than in Downtown Sarasota. For both 2017 and 2016, the last 13 weeks had 62 pending new construction sales or about a quarter of all home sales in the area.

 

Existing Home Sales Push Downtown Sarasota Condo Sales to 10 year New High

All data is from the My Florida Regional MLS for property type 
Condominium, ZIP code 34239 and for the time period indicated

First Quarter Downtown Sarasota Condo Sales

First quarter 2017 condo sales in downtown Sarasota of 110 where the highest since 2007 when 252 closed. The closing in 2007 included sales of 105 new construction residences that were completed during that month (and contracted for over the previous 12-24 months). Even without the new construction sales, however, 2007 was a barn burner with resales totaling 147. If only we knew that this would be the end for a while. The next 4 years sales in total would barely equal the 252 total in 2007. It would take about 2 and a half years just match the 147 resales.

Downtown Sarasota 1st Quarter Condo Sales Condo 2007-2017

Downtown Sarasota 1st Quarter Condo Sales Condo 2007-2017

Back to 2017, the 110 sales did include 8 new construction sales. However even 102 existing home sales would be the most total sales since 2007. When you consider all of the competition from new construction, this becomes even more amazing. Remember, when someone goes to contract on a new construction condo, the sale isn’t recorded until the unit closes. Closing doesn’t occur until the building is completed.

Downtown Sarasota Condo Sales by Price Range

The chart below shows the progression of sales by price over the past 10 years. 2008 was the first year of the crash and sales were the lowest of any year during the period by almost 50%. This probably distorted the figures some. However, over the past 5 years, about 9% of the total sales has been pushed out of the lowest bottom, “$0-$500k” range and into the top two price ranges.

Downtown Sarasota Condominium Invnetory

The next chart show that all categories have less inventory relative to sales than last year (Lower months of supply) with the exception of the $500k-$1M range, which increased slightly. We generally refer to markets with more than 6 months of supply as being buyers markets. In this case, the overall market is a just over 9 months of supply. Again, this is somewhat distorted because new construction is syphoning off sales – sales that wont show up until the buidling is completed months from now. Or anther way of saying this is that demand is greater than sales indicate.

Downtown Sarasota 1st Quarter 2017 Condo Sales

Downtown Sarasota 1st Quarter 2017 Condo Sales by price range

The final chart shows inventory and sales plotted on the same chart. There is a healthy relationship here with sales and inventory levels both moving up meaning that the market selling the higher levels of inventory. Furthermore there are huge chunks of pending sales waiting on the completion of buildings. If those sales had closed within say 60 days as most resales do, then the sales figures for the past 3 years would have been considerably higher. As it stands, a big chunk of those sales will likely close near the end of this year making 2017 one of the biggest years ever for condo closings in Sarasota.

Downtown Sarasota First Quarter Sales and Average Inventory 2008-2017

Downtown Sarasota First Quarter Sales and Average Inventory 2008-2017

First Quarter Longboat Key Condo Sales Slide for 3rd Season in a Row

The information in this post pertains to Longboat Key Condominium market ZIP code 34228 for the periods indicated. All data is from the My Florida Regional MLS.

Longboat Key Condo Sales

Condominium sales are slumping on Longboat Key. Sales were down 3.4% in 2016 compared to 2015. Existing condominiums sales (sales excluding the 26 new construction sales) were down 10.2%. 2016 also marked the 3rd consecutive year where sales were less than the prior year. This year looks to be worse than any of the past three, with sales through March down 21% compared to the same period in 2016. From an historical standpoint, the 66 sales recorded this season were the lowest since 2010.

The odd part is that condominium sales in other parts of the area are moving in the opposite direction. Downtown Sarasota and Siesta Key condo sales were up 29% and 32%, respectively, in the first quarter of 2017 compared to 2016.  Across the entire county of Sarasota, first quarter condo sales were up 8.6% over 2016. Even single family home sales on Longboat Key are up 33% in the first quarter compared to 2016.

Longboat Key First Quarter Condo Sales 2007-2017

Longboat Key First Quarter Condo Sales 2007-2017

With a near fixed supply of condominiums (only about 130 units constructed since the year 2000), you wouldn’t expect big swings in sales. A small, single digit increase or decrease each year would seem normal. But now, we are heading into 4 years of declining sales, and this year is looking like a double digit drop.

Longboat Key Condominium Inventory is on the rise

Average inventory levels have increased over the past 2 seasons. Given the low levels of inventory in prior years, the increase was not all that unwelcome. The 2017 average seasonal inventory was about 295 listings. The 2015 and 2016 average seasonal levels were low, at just 214 and 223, respectively. However, as shown in the chart below, sales have not only continued to decline as inventory climbed, but the rate of sales decline has accelerated. Average inventory during the winter season in 2016 was slightly higher than 2015, yet existing condominium sales dropped over 10%. This year, inventory climbed by nearly a third from an average of 230 in 2016 to 302 in 2017. Yet, sales were still down 21% for the season.

This odd, inverse relationship between sales and inventory is the way things have worked over the past 15 years. During the build-up in inventory prior to the crash, sales started to slide. Sales hit the floor about the same time inventory peaked. Then as the recovery started, sales started to grow and inventory dropped.

 

 

 

 

 

 

Longboat Key Condominium Prices

The hidden piece to this puzzle is price. Prices have been rising since late 2011. This phenomenon of both prices and inventory rising is a sure sign prices have risen too fast. When prices increase too fast, sales start to slow. Also, as prices rise, more owners are encouraged to sell, so more homes come on the market. The combination of fewer sales and more listings causes inventory to rise. While painfully low levels of inventory can crimp sales, large quantities of inventory do not drive more sales, especially if the inventory is priced above the price the market will pay.

Consider the charts below. The charts compares sales and inventory by price point for the first quarter of 2012 and 2017. Note the differences across years at the 0-500k level. This bottom tier of pricing accounted for 56 of the 92 sales in the first quarter of 2012 (61% of all sales). The average inventory available for sale during those 3 months was 222 listings. For 2017, sales had dropped to just 31 and average inventory to just 117. Total inventory dropped from 375 to 304 or about 19%, but in the most popular price point on the Key, inventory was reduced almost 50% from 222 to 117. The 105 listing decrease is greater than the overall decrease in inventory.

 

 

 

 

 

 

This is more than just a shortage of lower priced units the market. Rather, it is huge chunks of inventory being priced out of the lowest range (i.e., the 2012 $475,000 condos moving to $525,000 range in 2017).  You can see from the chart below this has been a gradual process since 2011.

 

 

 

 

 

 

 

The trouble, for now, anyway, is the budget for the pool of buyers has not increased as fast as this appreciation or much of the inventory that moved up in price was not worthy of the increase. This big shift in pricing has created a big bulge in inventory at the $500-1 million price range.

Also note these price point ranges are just arbitrary. Asking price has moved up inside and at the boundaries of these ranges. Just because a home might be priced under $500k doesn’t mean it will sell at $450,000 if the fair price is $400,000. Overall asking prices seem too high and will likely have to come down, at least in the under $1 million price points.

Finally, please read my article on the first quarter single family home update for Longboat Key. In particular take a look at the first chart which shows first quarter sales and inventory chart for the SFR market and note how it differs from the condo chart. The general movement of both sales and inventory is up. Additionally sales in the SFR market set a 10 year high this year for the first quarter.

.

First Quarter 2017 Home Sales On Longboat Key Set 10 Year Record

The information in this post pertains to Longboat Key ZIP code 34228 single family home sales for the periods indicated. All data is from the My Florida Regional MLS for the time periods mentioned.

 

First quarter single family homes sales on Longboat Key in 2017 were a 10 year high of 32 homes. First quater sales have averaged about 23% of the total year.

Longboat Key Single Family Home Sales

Longboat Key First Quarter Sales and Average Inventory 2007-2017

 

 

 

 

 

 

 

If that holds up this year, then 2017 then we would push the 140 home sales mark on the year which would be a 10 year record (if not longer).  With only about 1830 single family homes on the key, that would mean that over 7.5% of all homes turned over this year.

Longboat Key Single Family Home Sales

Longboat Key Single Family Homes Sales by Year 2007-2016

Nearly half of all sales traded between $500k and $1M with the median price being $920. The median price for the first quarter last year was 962k.  While people certainly spent more per home last year than this year, I does not necessarily hold true that prices are falling. To determine that you have to look at what each group received for the money. For example, in 2016 when the median transaction price was higher, 83% of the sales were on water (canal, gulf, or bay). In 2017, when the median price was lower, only 71% of the sales were on water. Just looking at this one statistic, buyers received more home for the $ in 2016 than 2017.

Family Home Sales by Price Range 2017 and 2016

Longboat Key Single Family Home Sales by Price Range 2017 and 2016

 

 

 

 

 

 

 

 

 

Other facts from this seasons sales:

  • Almost a third of the sales were in Bay Isles (10 of the 32 sales) while Country Club Shores accounted for another quarter (8 of the 32 total)
  • Half of the homes sold this season were built before 1980, which mirrors the overall composition of homes on the Key.
  • The highest priced sale was a 6,500 sf home in the Harbor section of Bay Isles that closed for $4,625,000.
  • The lowest priced sale was an 884 sf home in the Village that closed for $300,000.
  • Canal front sales ranged from 661,000 to 2,250,000. The only gulf front property to sell was a 6 cottage motel on less than an acre of property. The sale price was $3,800,000.

For an update on the Longboat condominium market, click here.

Longboat Key Condo Inventory September 2016

New Construction Condo Sales Accounts for All Condo Sales Growth on Longboat Key

Longboat Key Condominium Sales Volume

Longboat Key condo sales were up 4% in the current period, compared to the previous year. New construction sales accounted for 26 sales, about an 8% increase over the previous year. The price points for new construction sales ranged from $2.9 M to $5.1M. Given that only 5 resales closed for more $2.9 M or more, with the highest being $4.2M, it is unlikely these sales took much away from the resale market. That means resales on the Key dropped about 4% during the year.

Click to Download Recent Longboat Key Condominium Sales Addresses/Prices

Looking at sales by price point confirms this. The decrease in sales came from the under $1 M price point (down 10%). If anything, new construction brought more lookers to the Key in the higher price points, as the resales priced over $2 M increased by 50% (from 12 last year to 18 this year).

lbkcondo-upd-92016-salesvnewlists

Longboat Key Condominium New Listings

New Longboat Key condominium listings increased to 491 during the current period, compared to 404 during the previous year, for a 21% increase. While the under $1 M price point showed the smallest increase in listings, there were still 19% more listed this period than last, implying a shortage of inventory was not to blame for the fall in sale.

Median Sales Price- Longboat Key Condominium Sales

The median sales price increased to $575,000 for the current period, compared to $510,000 for the previous period or about 12.7%. The high values of the 26 new construction sales (ranging from $2.9M to $5.1M) accounted for more than $50,000 of the increase. Without new construction sales, the median price would have come in at $525,000 or just a 2.9% increase.

Longboat Key Condo Median Sale Price

Longboat Key Condo Median Sale Price

Unsold Longboat Key Condominium Inventory at September 30th

Unsold inventory at the end of September stood at 180 listings, up 50% over the 121 available for sale at the end of September 2015. The increase is largely the result of an increase in new listing offset by a few more sales and expired/withdrawn listings.

Longboat Key Condo Inventory September 2016

While the increase looks huge, it’s only because of the unusually low inventory on-hand during the second half of 2015. The 121 listings available for sale last September was a 10-year record low for any month. If you compare 2016 to the number of unsold listing on-hand at the end of September 2013 and 2014 (190 and 172, respectively), things look more normal.

The median asking price of ending inventory dropped 11.7% to $849k at the end of September 2016 from $961 at the end of 2015.

 

 

 

 


Click box to see current Longboat Key Condominiums listed for sale by price point

Under $500k    $500k-$1,000k    $1,000k-$2,000k    over $2,000k


Other Miscellaneous Longboat Key Condominium Stats

  • During the current period, 34% of all listings that sold were on the market for 30 days or less. In the previous period, only 24% of listings were on the market for 30 days or less.
  • Median days on the market for a sold listing was 69 this year, compared to 89 last year.
  • The average listing sold for 96% of the listing price this year, compared to 95% last year.
  • There were 5 distressed sales (foreclosure or short sale) this year, compared to 12 last year.
  • Expired and withdrawn listings totaled 119 this year or about 24% of all new listings, compared to 104 last year or 25% of all new listings.

Downtown Sarasota Condos – What You Get for Under $1 Million

All of the data used in this post were obtained from the My Florida Regional MLS for condominium SALES in the downtown Sarasota Area. I used all condo sales in ZIP Code 34236 on the east side of the Ringling Bridge for calendar year 2016 through the end of August.

 

The Smaller Side of Downtown Sarasota Condominiums

If you are just looking for a nice place to enjoy Sarasota and get away for the winter, maybe a 1 BR condo is all that you need. As shown below, there have been 23 sales in the category over the past 8 months with prices ranging from $120,000 to $437,000. The limit we are discussing here is up to $1,000,000 but no 1/1 sold for any higher than the 437,500 in any event.

For a 1/1, the under $200,000 price point puts you in either an older (1957 built) building or something on the very edge of downtown, like Central Park in this case.

Downtown Sarasota Condominiums - Statistical Porifle of Sales Under $1 million

Downtown Sarasota Condominiums – Statistical Porifle of Sales Under $1 million

If your price point is in the 200’s to very low 300’s, you could end up with a large 1BR/1BA (800-1000 square feet) residence with 1-2 garage parking spots on a low floor in the Renaissance (750 TamiamiTrl). Also for a mid-200’s price, you might be able to find a 675 sf unit in one of Sarasota’s most nostalgic buildings, the Frances-Carlton. Walk through the building and you will think you are a character in Fitzgerald’s The Great Gatsby. And for a good reason, the building opened about the time the book was published.

To see all 2BR/2BA and larger condominiums currently listed for sale under $500,000 in Downtown Sarasota, click here.

The mid 300’s to mid-400’s represents the highest selling prices for anything smaller than a 2/2. For this price, you can get a nice-sized residence in the heart of downtown (like in1350 Main where the highest priced sales was located) or direct bay view in either Alinari or Renaissance (on the Trail).

To download the complete list of sales for all 1BR/1BA condominiums that sold in downtown Sarasota for the 8 months ended August 31, 2016, click here.

The Most Popular and Abundant Downtown Sarasota Condonimium- 2 Bedroom/2 Bath Models

The 2/2 floor plan is by far the most popular downtown, accounting for almost 72% of all condominium sales during the 8 month period. You could say that the majority of them sell since they comprise the bulk of the total supply downtown. This is true, but the 2/2’s suck up more than their share of sales as only about 60% of all downtown Sarasota condominium residences are 2/2’s.

To see all 2BR/2BA and larger condominiums currently listed for sale between $500,000 adn $1,000,000 in Downtown Sarasota, click here.

Your best bet under $300,000 is going to be Central Park, located on the southern edge of the ZIP code in the 800 block of South Trail. Dolphin Tower could also have a listing in this price range. In the $300,000 – $400,000 range, try looking in Broadway Promenade, CityscapeGulfstream Towers, or the Renaissance. Note that the under $400,000 listing price comprised only a third of the 2/2 sales, so don’t expect a huge selection in any one building. These listing are going to be peppered around downtown.

To download the complete list of sales for all 2BR/2BA condominiums that sold in downtown Sarasota for the 8 months ended August 31, 2016, click here.

Things open up considerably in the $400,000-$600,000 price point. You could find a nice residence in Alinari , Sunset Tower100 CentralPalm Place, or Regency House.  The over $600,000 price might be found and Alinari1350 MainBay Plaza, Lawrence Point (i , ii, and iii), One Watergate,  Condo on the Bay (888 and 988), or Essex House.

The 3 Bedroom Models – a Rare Find under $1 Million

There were only 15 sales of 3 bedroom models during the period. Six of them were in Rivo, and they were sold for between $500,000 and $550,000. At the upper end of the price range, watch Bay Plaza as it was the second largest source of 3BR sales with 3 selling at prices between 650,000 and 950,000. Other sales were scattered throughout downtown.

To download the complete list of sales for all 3BR condominiums that sold in downtown Sarasota for the 8 months ended August 31, 2016, click here.