Home Sales Show Signs of Hope
Price drops appear to entice buyers to make the purchase
The bad news (although this could be considered good news): Sarasota-Bradenton home sellers are cutting prices so aggressively that the median sales price was 18 percent lower this November than last, the biggest drop in the state. For anyone who pays attention to the Sarasota real estate market this should not be any surprise.
The good news: Sarasota-Bradenton home sales were up by 2 percent from a year ago, the best gain in the state.
We are now about 18 months into this slow down. I believe the Sarasota real estate market stopped before many other markets in Florida. In the middle to late 2005 I spoke to several other Realtors from around the state. While Sarasota was very slow many other parts of Florida remained active. Now we appear to be bottoming out before the other Florida markets.
It takes time for the sellers psychology to change. In late 2005 the sellers were thinking that this was just a temporary slow down and that the season would fire the market back up again. That did not happen. The buyers remained very cautious and reluctant to purchase for fear of further price decreases.
Now, in the middle to late 2006 with the onslaught of negative press the bad real estate market receives and about a year into a slow market the sellers are giving in and dropping their prices. The sellers who lower their prices to late 2004 price levels are seeing action.
I have worked with plenty of potential buyers in 2006. Some of them purchased but many of them are still on the sidelines waiting. The reason they did not purchase was not because of affordability issues. These buyers did not purchase because of the possibility of lower prices. They simply were not pressed to buy and were willing to wait for lower prices. Those who were not interested in timing the real estate market and wanted a place to call home or 2nd home bought. The people on the sidelines still want to buy. I speak to them regularly and very few of them have decided not to buy here at all. They will buy when they feel the market has bottomed out.
The Sarasota real estate market will start the bottoming out process in 2007. We may be there already but only time will tell.
The bad news (although this could be considered good news): Sarasota-Bradenton home sellers are cutting prices so aggressively that the median sales price was 18 percent lower this November than last, the biggest drop in the state. For anyone who pays attention to the Sarasota real estate market this should not be any surprise.
The good news: Sarasota-Bradenton home sales were up by 2 percent from a year ago, the best gain in the state.
We are now about 18 months into this slow down. I believe the Sarasota real estate market stopped before many other markets in Florida. In the middle to late 2005 I spoke to several other Realtors from around the state. While Sarasota was very slow many other parts of Florida remained active. Now we appear to be bottoming out before the other Florida markets.
It takes time for the sellers psychology to change. In late 2005 the sellers were thinking that this was just a temporary slow down and that the season would fire the market back up again. That did not happen. The buyers remained very cautious and reluctant to purchase for fear of further price decreases.
Now, in the middle to late 2006 with the onslaught of negative press the bad real estate market receives and about a year into a slow market the sellers are giving in and dropping their prices. The sellers who lower their prices to late 2004 price levels are seeing action.
I have worked with plenty of potential buyers in 2006. Some of them purchased but many of them are still on the sidelines waiting. The reason they did not purchase was not because of affordability issues. These buyers did not purchase because of the possibility of lower prices. They simply were not pressed to buy and were willing to wait for lower prices. Those who were not interested in timing the real estate market and wanted a place to call home or 2nd home bought. The people on the sidelines still want to buy. I speak to them regularly and very few of them have decided not to buy here at all. They will buy when they feel the market has bottomed out.
The Sarasota real estate market will start the bottoming out process in 2007. We may be there already but only time will tell.
posted by Marc Rasmussen at
6:09 AM
2 Comments
