Real Estate in Sarasota: Spring 2008 Market Update
Wow!? … that about sums up my initial feelings / thoughts when considering the state of our spring 2008 real estate market in Sarasota.
It is hard to imagine how rapidly the landscape is changing.
Real Estate activity, mood and trends used to be discussed in terms of years. Today these factors, describing what is happening, change quarterly …. and sometimes, I’m afraid, monthly. This instability leaves both, those working within the industry, and those observing from the sidelines, shaking their heads with their mouths hanging open.
Kind of saying “wow, is this really happening?”
It is most definitely happening, however, the question that remains unanswered is “how long until we hit bottom?”. Depending on who you talk to, we have hit bottom or we won’t hit it until mid year. I guess the answer might depend on how you define bottom.
I’m thinking bottom might be defined as the point where:
So our inventory may never be larger … I believe a real sign of hitting bottom.
And, I think sellers, across the board, now, for the first time in the last 18 months, understand the gravity of the situation we’re in, and are willing to sell at a price they formerly would never have considered.
I think this screams “bottom”.
What does this mean?
Well, it means that those who don’t need to sell right now, shouldn’t. If someone does place their home on the market, its list price should be substantiated with recent sales comps …. no more emotional pricing.
It means buyers who buy now will have their choice of the largest inventory in memory, and at truly motivated prices. As I said in my winter report, there will never be a better “buyer’s market”. This would normally be a good thing, but with so many other economic concerns, not to mention a media that thrives on the doom and gloom message, people with money are afraid to part with it.
Unfortunately, for sellers and those working in the industry, it may take some time to rise from this bottom. Buyers are going to have to be willing to “jump in” and take advantage of this opportunity.
Since so much of Sarasota’s real estate activity in recent years, has been speculative or investment, and there is little chance of that buyer coming back soon, we are going to have to rely on those who move here, or decide this is the perfect reprieve from northern or European winters.
These buyers will continue to come, and I don’t know the exact stats, but I would guess at almost the same numbers as before, but with this large an inventory, it will take years to go through it. So, it will seem that we are selling less and people won’t be making quick and easy money; but what we will be left with in five years is a much more solid foundation to build a thriving community.
And then, hopefully, we will do everything we can to discourage such a thing happening in our town again. No more reporting “that a large condo project sells out in 90 minutes” without reporting that the majority of the buyers were speculators / investors. No more allowing the City leaders to approve a dozen condo projects all set to be completed within 12 months of each other. No more glorifying the person who buys a home today and sells it next month at a substantial profit, without any improvement to it. You get the idea.
Well, time will tell … and in the meantime, if you are considering a home in paradise, now is truly the time to buy. Good Luck!
It is hard to imagine how rapidly the landscape is changing.
Real Estate activity, mood and trends used to be discussed in terms of years. Today these factors, describing what is happening, change quarterly …. and sometimes, I’m afraid, monthly. This instability leaves both, those working within the industry, and those observing from the sidelines, shaking their heads with their mouths hanging open.
Kind of saying “wow, is this really happening?”
It is most definitely happening, however, the question that remains unanswered is “how long until we hit bottom?”. Depending on who you talk to, we have hit bottom or we won’t hit it until mid year. I guess the answer might depend on how you define bottom.
I’m thinking bottom might be defined as the point where:
- those who are in trouble, know they are in trouble (over leveraged) and have begun taking the steps that lead them to placing properties they purchased high or as investments on the market, unfortunately at prices lower than what they owe on them (a short sale) so they can avoid the dreaded foreclosure, or they take the one major step where they stop making mortgage payments, send the bank the keys and walk away from the home … and invite the foreclosure.
- those who purchased their homes as their residence, find themselves having to sell for reasons that have nothing to do with personal financial hardship, but now have to sell their homes in a market populated by the properties described in # 1, forcing them to sell at prices below even real market value prices.
So our inventory may never be larger … I believe a real sign of hitting bottom.
And, I think sellers, across the board, now, for the first time in the last 18 months, understand the gravity of the situation we’re in, and are willing to sell at a price they formerly would never have considered.
I think this screams “bottom”.
What does this mean?
Well, it means that those who don’t need to sell right now, shouldn’t. If someone does place their home on the market, its list price should be substantiated with recent sales comps …. no more emotional pricing.
It means buyers who buy now will have their choice of the largest inventory in memory, and at truly motivated prices. As I said in my winter report, there will never be a better “buyer’s market”. This would normally be a good thing, but with so many other economic concerns, not to mention a media that thrives on the doom and gloom message, people with money are afraid to part with it.
Unfortunately, for sellers and those working in the industry, it may take some time to rise from this bottom. Buyers are going to have to be willing to “jump in” and take advantage of this opportunity.
Since so much of Sarasota’s real estate activity in recent years, has been speculative or investment, and there is little chance of that buyer coming back soon, we are going to have to rely on those who move here, or decide this is the perfect reprieve from northern or European winters.
These buyers will continue to come, and I don’t know the exact stats, but I would guess at almost the same numbers as before, but with this large an inventory, it will take years to go through it. So, it will seem that we are selling less and people won’t be making quick and easy money; but what we will be left with in five years is a much more solid foundation to build a thriving community.
And then, hopefully, we will do everything we can to discourage such a thing happening in our town again. No more reporting “that a large condo project sells out in 90 minutes” without reporting that the majority of the buyers were speculators / investors. No more allowing the City leaders to approve a dozen condo projects all set to be completed within 12 months of each other. No more glorifying the person who buys a home today and sells it next month at a substantial profit, without any improvement to it. You get the idea.
Well, time will tell … and in the meantime, if you are considering a home in paradise, now is truly the time to buy. Good Luck!
posted by Gigi Silverberg, Realtor at 9:44 PM
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