The little island that could
Despite being in the middle of an historic economic downturn, most Anna Maria Island residents wake up every day and are thankful that they have sand in their shoes and salt in their hair. Now Island residents have even more reason to be hopeful, and that reason is spelled R-E-A-L E-S-T-A-T-E.
Based on national newspaper reports, the housing market in the vast majority of the country is still on its knees or worse. Last month, the Wall Street Journal reported in its latest quarterly survey that in 28 major metropolitan areas in the country prices were still in decline, with the size of the year to year price declines greater than the previous quarter in most markets.
In addition, inventory levels are rising in many markets as unsold homes just sit because of weak demand resulting in falling prices. And even though interest rates are historically low, tight credit conditions, higher down payments and difficult appraisals have resulted in many buyers unable to get financing. Not to mention the lack of growth in the job market keeping consumer confidence low, and high numbers of foreclosures and short sales keeping values down.
But what's happening in our specific real estate market? As a whole, Manatee County is still trying to find its real estate footing with some stability coming back into the market. January single family homes sales were down in both sales and pricing. However, pending home sales rose, and the overall inventory of unsold homes fell. The biggest problem facing Manatee County is the number of foreclosures and short sales. Until these distressed sales are considerably reduced there isn't much chance of prices going up.
Anna Maria Island, however, is having a much better time of it. As reported by this paper, there was a strong upturn in sales in 2010 with the anticipation of 2011 starting to show some increase in prices. Between December 2009 and December 2010 there was a 29 percent increase in sales, and overall for the year, the Island's sales were up 35 percent. According to local real estate professionals this was the highest rate of sales since 2005.
Anna Maria also has foreclosures and short sales, and in 2010, 28 percent of sales on the Island were distressed, higher than 2009. The good news is that so far this year only 6 percent of properties for sale on Anna Maria are classified as distressed, much better that Manatee County as a whole and the country in general.
In most of the country there appears to be a standoff between buyers and sellers. Some sellers can't reduce prices any lower without selling for less than they owe on their mortgage, and buyers are making offers based on the perception that the market will continue to go down. Until the distressed inventory is substantially reduced, the country as a whole will be slow to recover, but it will inevitably happen
Meanwhile, little Anna Maria is still the Island that could.Oour market keeps chugging along gradually reducing inventory and distressed properties. I always knew that when the recovery started, it would start on the Island and move east. Eventually, the last of the distressed properties and short sales will sell, and when that happens, the little island that could will turn into a bullet train. Get ready to hang on.