August property sales almost 20 percent higher than last year

Below is a press release from the Sarasota Association of Realtors

August 2009 saw an almost 20 percent increase in local property sales than reported in August 2008, most likely fueled by the $8,000 first-time homebuyer tax credit, an economy in the midst of recovery after a two-year recession, and continuing low interest rates.

Total sales nearly reached the 500 level again, with 496 properties changing hands. The total included 382 homes and 114 condos. This compares to 329 homes and 86 condos sold in August 2008, for a 19.5 percent increase from last year at this time. The total was an expected drop from the July 2009 overall sales of 595, due to the traditional slower summer season. But the fact that sales did not dip as low as last year brought a sigh of relief from most local real estate brokers.

Most of the statistics continue to point to a market in the initial stages of recovery. Inventory levels continued to decline. There were 3,949 single family homes for sale at the end of August, compared to 4,067 for sale at the end of July, and down 11.8 percent from the 4,477 at the end of June. Condos experienced a similar decline, to 2,343, from 2,447 at the end of July and 2,587 at the end of June. Inventory remains at the lowest point in more than 5 years – a good sign for a market in recovery.

In August 2008, the inventory of unsold single family homes stood at 6,461 – roughly 63 percent higher than this year. For condos, there were 2,407 properties on the market in August 2008 – nearly the same as this year’s figure of 2,343.

The number of months of inventory – the time it would theoretically take to sell all the current properties on the market – now stands at 10.34 for single family homes. This figure is slightly higher than the 9.04 for single family in July 2009, but significantly lower than the figure of 19.64 in August 2008.

For condos, the current months of inventory stands at 20.5, somewhat higher than the 16.9 months in July, but substantially lower than the 28 months in August 2008. The overall trend for the past two years, excluding some monthly aberrations, is downward toward the figure of 6 months, which indicates a market in balance (anything below 6 months indicates a return to a seller’s market). Prices are also remaining at more realistic, sustainable levels, with the median sale price for single family homes at $155,000 in August 2009, down from the $185,000 in July 2009, but very close to the figure seen in January, February, March and May this year. The median sale price for condos was $285,000, much higher than the $212,000 figure seen in July, and almost at the $295,000 level reported in August 2008.

The median price for all single family homes sold in the past 12 months stood at $165,000, compared to a median of $255,000 for the 12 months ending in September 2008. For condominiums sold in the past 12 months, the median sales price was $200,000, compared to $330,000 for last year at this time.*

Pending sales also remained high and consistent, with 830 properties going undercontract in August 2009, compared to 802 in July 2009. Pending sales have dropped off slightly from the 929 reported in May 2009 and the near record 981 pending sales reported in April 2009. But the total of 830 was still 53 percent higher than the 541 pending sales reported in August 2008. Pending sales have now exceeded the 500 level for the 20th consecutive month and the 800 level for the sixth straight month. Generally, pendings trend downward during the summer months, the slower sales season in our market.

The statistic is a strong indicator for the next two or three months of sales, when many of these pendings will become closed sales. Pending sales reflect contracts executed by buyers and sellers during the month. “We are continuing to encourage our members to educate their clients and potential clients on the $8,000 tax credit for first-time home buyers, as we are rapidly approaching the expiration time of Nov. 30, 2009, when these types of sales must be finalized,” said 2009 SAR President Bill Geller of Suncoast International Realty. “With the higher levels of short sales and foreclosures remaining in our local market, we can reasonably expect our sales statistics to be skewed. However, we may be seeing a turning point in recent months, as the numbers seem to have bottomed out for single family prices.”

Geller said that, lacking a crystal ball, it is difficult to predict what will happen during the remainder of the year. But lower inventories, sales remaining above the 500 level, and higher pending sales figures all point to a return to stability.

“We appear to have weathered the storm well, and while tomorrow’s economic weather forecast remains to be seen, I’m confident and enthusiastic about our future prospects,” explained Geller. “People who live here and our visitors know that there is no place like Sarasota, and the selling points for this area are obvious.”

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