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Inventories of Properties In Southwest Florida Drop to Lowest Levels In 39 Months

ALL INDICATORS POINT TO A MARKET ON THE MEND

“It’s an absolute perfect storm from a buyer’s point-of-view,” said Michael Saunders, founder and CEO of Michael Saunders & Company, in explaining the market dynamics behind the substantial uptick in sales and pending sales that continued unabated through March; to say nothing of the corresponding decline in available inventories, as measured by TRENDGRAPHIX for its latest report on monthly sales within the region’s MLS.

“Several key fronts have merged to cause buyers to shrug off fear, cast indecision aside; and respond to the notion that right now is the best time to buy properties since the turn of the century.” Saunders explains. “In addition to the lowest prices in recent memory, interest rates are presently hovering around 4.78 percent, lenders are back in their comfort zone lending again; and buyers who haven’t owned a home in three years are apt to qualify for a first-time homebuyer tax credit—of up to $8,000—as long as they purchase by December 1.  In other words, the bottom that everyone has been looking for is beginning to form; and the smart money is back to considering prime location even as it searches for unprecedented values.  The best-priced opportunities in the choicest locations are selling first and fast.”

TRENDGRAPHIX’s latest report for March—just released—shows that months of inventory based on closed sale transactions have dropped to their lowest levels in over 39 months according to the latest MLS data for March, 2009. In the Tri-County region of Sarasota, Manatee and Charlotte counties, inventories are at their lowest since December 2005.

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While not yet representative of a full-fledged reversal of the real estate market, the trend towards reduced inventory, higher sales and higher pending sales are indicative of a return to healthier conditions for home sellers. The area is now considerably off of the peak “buyer’s market” of 2007 and 2008.

TRENDGRAPHIX’s latest report shows that sales increased 28.3 percent during the month of March for the Tri-County region of Sarasota, Manatee and Charlotte counties. Combined Tri-County March 2009 sales were 14.9 percent higher than March 2008 sales. Pending sales increased by 27.4 percent from February to March 2009. March 2009 inventory of 19,715 homes for sale is 30.6 percent lower than March 2008 inventory.

COUNTY HIGHS AND LOWS

Sarasota County sales increased 26.2 percent from February to March 2009. Inventory decreased 2.4 percent during this same time period. Pending sales increased by 25.7 percent. 82.4 percent of the homes sold for under $300,000; 9.9 percent of the homes sold for between $300,000 and $500,000; and 7.6 percent of the homes sold for over $500,000.

Manatee County sales increased 32.2 percent from February to March 2009. Inventory decreased 1.7 percent during this same time period. Pending sales increased by 19.2 percent. 84.2 percent of the homes sold for under $300,000; 10.5 percent of the homes sold for between $300,000 and $500,000; and 5.1 percent of the homes sold for over $500,000.

Charlotte County sales increased 28.1 percent from February to March 2009. Inventory decreased 3.1 percent during this same time period. Pending sales increased by 42.9 percent. 93.3 percent of the homes sold for under $300,000; 4.8 percent of the homes sold for between $300,000 and $500,000; and 1.8 percent of the homes sold for over $500,000.

  • User Gravatar ToddinFL
    April 20th, 2009

    Michael,

    As long as you have been trumpeting the notion that “it’s always a great time to buy Sarasota real estate”, etc., making another “bottom” call is quite premature, at best.

    Buyers who have CASH are in control of the RE market. Contrary to what you proffered, (“lenders are back in their comfort zone lending again”), banks are NOT lending to the extent that just anyone can get a loan. Nor should they be.

    The markets and governments are grappling with excessive debt that has been built up over many years. The chicken has now come home to roost.

    Only those well-capitalized buyers who have cash can operate in this market. And it is for that VERY select group of buyers where the best values are negotiated.

    Given the backdrop of bad economic news that is now a reality, you may be better served (and gain some respect) if you toned down the shtick.

    Just one person’s opinion, as always.

  • User Gravatar Still looking
    April 30th, 2009

    I must agree with Todd. The inventory reduction and sales acceleration is due to fire sale foreclosures. There are plenty more where those came from. None of the data above show how much prices have dropped. Well, they have further to go. Fortune Magazine predicts a bottom toward the end of 2010 or spring 2011 for this area. Fortune also predicts another 20+% price drop. in the entire nation only Miami is worse.

  • User Gravatar ToddinFL
    May 1st, 2009

    Given the significant drop in prices of local real estate, I don’t completely disagree with the Saunders group that there aren’t some opportunities present, because they certainly exist.

    It is my contention that the RE buyer that is currently in control of the market is the well-capitalized, cash buyer. Someone who can come to the closing table and scratch a check, unencumbered by low credit ratings or excessive debt.

    For that type of buyer (and they are relatively few), there are opportunities to negotiate terms and purchase properties at very favorable prices, when viewed over the long term.

    That said, there is quite possibly more room on the downside in prices for properties where the sellers have refused to acknowledge the reality of the current market.

    What most RE market watchers know is that calling yet another major market bottom for the broad spectrum of local real estate is probably premature.

    Just one person’s opinion, as always.

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