Top issues to watch in 2014: Real Estate

Sarasota County’s resurgent construction industry and real estate market are a bellwether for the area’s economic recovery from the worst financial crisis to hit the nation since the Great Depression.

Property values are increasing countywide, bolstering area government coffers due to increased property tax revenue. But, a shortage of skilled labor threatens to moderate the pace of the construction industry’s post-recession revival and potentially drive up building costs.

Home values steadily increased in 2013, a trend that has revived area real estate markets and will last through 2014, experts said.

Median sale prices for single-family homes sold in Sarasota County in November were up 20.6% compared with November 2012.

The 12-month rolling median for condominium sale prices also indicated that condominium values are steadily increasing. At the end of November, the median sale price for area condos was $163,000, up 10.1% from November 2012. 

“The November 2013 statistics indicate that the local market has leveled off at a high sales rate,” Sarasota Association of Realtors President Roger Piro said. “Once we get into early 2014, I wouldn’t be surprised if this market expanded once again.” 

Sarasota County’s construction industry is also on the rebound from the economic downturn, injecting momentum into the area’s economic growth and increasing revenue for area governments. 

In October, the rate of construction of single-family homes was up 70.8% over the rate in October 2012. Although the fourth quarter of 2013 saw a slight slowdown in the pace of new-home construction, the industry is expected to gather momentum in 2014.

And, according to a county report released last year, new developments such as The Mall at University Town Center and the Esplanade development could potentially add more than
$1 million in annual property tax revenue for the county. 

As the pace of construction increases, so too will the demand for labor, which could limit contractors’ production.

“I hope we can keep the boom going, but we have to get more people into the industry,” said Doug Sutter, vice president of Sutter Roofing Co. “The labor shortage is a big, big concern, particularly in skilled labor.”

Overview: Sarasota County’s real estate markets and construction industry are expected to continue their resurgence despite a skilled-labor shortfall, which threatens to dampen the pace of growth.

Players: Sarasota Association of Realtors, Gulf Coast Builders Exchange, Sarasota County Commission

Timeline: Expect a continued increase in property values going into 2014, as well as increases in construction costs.

Contact Nolan Peterson at [email protected]