Florida homebuyers: Be here now
It's May, and we can all look forward to warm lazy days, plenty of elbow room at the beach, no traffic and best of all, getting a table at our favorite restaurant. But are we really happy the winter visitors are gone, and more important, have they made a mistake leaving?
In view of the March home sales reports both nationally and locally, anyone interested in purchasing Florida real estate should be here now. The National Association of Realtors reported that sales rose during the month of March by 3.7 percent over March of last year. This was more than expected, as economists polled by Reuters predicted sales to rise 2.5 percent. During six of the last eight months, sales have risen on a national level giving the industry a good dose of cautious optimism.
Much of the sales activity remains in the foreclosure and short sales arena, accounting for about 40 percent of transactions. Because of this, prices are continuing to be pushed lower, since foreclosures and short sales typically are about 20 percent below market value. These depressed properties are being frequently purchased by investors, foreign and out of state buyers, who hope to turn a profit as the supply thins, clearing the way for higher prices in the future. To put this is some perspective; the Associated Press reported that half of the homes listed in the Tampa Bay area are selling for less than $100,000.
In addition, these sales have shrunk the supply of unsold homes in five of the major markets in the country, including Tampa Bay, by 13 percent over the past year. The March sales pace put the supply of existing homes on the market at an 8.4 month supply down from 8.5 in February. The ideal number is a six- to seven-month supply, so we're getting there.
The Sarasota-Bradenton sales market also reported home and condominium sales in March at levels not seen in almost six years, the most since August of 2005 in a single month. Sarasota-Bradenton's sales were somewhat less than other areas of the state including Miami and Tampa, but activity anywhere in the state is good for the entire state.
Like the rest of the country, Florida sales prices are also down, with the median Florida house selling for $126,500 in March, almost $10,000 less than a year ago. As reported by the Florida real estate industry, statewide sales were up 24 percent but prices were down 11 percent.
Finally, according to the National Association of Realtors, 35 percent of the sales in March were a record setting all-cash transaction. This fact is also born out in our local market, where real estate offices are reporting an unprecedented number of all-cash sales.
My advice to potential Florida homeowners is to get back in your vehicles and head south on either I-75 or I-95. If you wait for next winter's buying season you may have missed the bottom of the market and the opportunity of a lifetime.
If you haven't visited Anna Maria during the summer I promise you'll enjoy the warm water and even warmer home prices.
