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MANATEE COUNTY — Signs of economic recovery are beginning to show in the East County real estate market.
A Florida Association of Realtors report released last week showed sales for existing homes in the Bradenton/Sarasota area were up by 31% in May 2010 compared to the same month last year. Home prices in the area also increased by 6% comparatively with a median price of $166,000 (up from $156,600 in May 2009).
Out of 19 metropolitan statistical areas, the Sarasota-Bradenton area had the fourth-highest increase in sales compared to May of last year and the third-highest increase in median sales prices.
Even more significant, however, is that top Realtors say the housing market for homes under $400,000, particularly in the East County area, has swung back into normalcy. In the 34202 zip code, for example, there are less than 300 existing homes listed on Multiple Listing Service.
“I’m even having listing contests in my offices; we need listings,” said Michael Saunders, owner of Michael Saunders & Co. “That, a year ago, you would not have heard out of my mouth.
“(It’s) a really balanced market right now,” she said under-$400,000 market. “When I say balanced market, I mean a seven-month supply. It’s not a buyer’s or a seller’s market.”
Gloria Weed, managing broker for Saunders’ Lakewood Ranch office, said, there have been 249 home sales in the last six months and 15 sales pending.
“We’re selling almost as many homes as we have listed within six months,” Weed said. “We can also judge that by some of the builders that have been out of the market for years are building again. We also have new builders — Minto and Paradise Homes. Home sites are being released by (Schroeder-Manatee Ranch) and Neal (Communities).”
Weed said a steady increase in home sales began in November, and numbers are back to where they were when the real estate market was healthy.
Saunders said her company has seen an increase of 88.9% in home closings year-to-date compared to the same timeframe last year. The company also is up 68.67% in the number of contracts written and ready for execution, she said.
Helen Sosso, CEO of Prudential Palms Realty and Prudential Lakewood Ranch Realty, said her firm is enjoying similar success.
“I definitely think the real estate market is coming back,” she said. “The interest rates are so low, and the values are so great. You couldn’t have a better time to buy a property.”
Longtime East County Realtor Monte Davis, of RE/MAX Alliance Group, said comparing asking prices with selling prices also is an indicator that the market is coming into balance.
“We have reached kind of a standard level,” she said. “You can ask whatever you want to ask, but it’s what the purchasers want to pay. I’ve seen houses listed for $275,000, and those are coming in $250-260K range. That tends to start setting up the leveling, where before — when a house was listed at $279, 000 you’d get pretty close to the price.
“Now people have their benchmarks that they are willing to pay,” Davis said. “They are making bids and it seems like there’s a leveling off, so they are all coming in around the same thing.”
Despite the good prognosis, Realtors are quick to point out the stabilization of the market is limited to certain housing prices and types. For example, condominium sales vary greatly by community, and there is still a two-year supply of homes priced at more than $1 million, Saunders said.
Homebuyers, whether looking for their first home or a vacation home, are being lured by low interest rates and home prices not seen in the area since the early 1990s, Saunders said.
Low interest rates are significant because even a 1% increase could result in a large increase to a monthly payment.
“The feeling is that interest rates will go up, and really, people look at two things,” Saunders said. “They look at the price of the house and what it’s going to cost them to live in the house. It’s a huge incentive to buy while interest rates are at historically low rates.”
Saunders noted home prices have dropped an average of 30% since the peak of the real estate boom in December 2005.
That, combined with the area’s culture, educational institutions and lifestyle options, make the area one of the most desirable in the state, Saunders said.
Although some Realtors have seen a slight drop in sales to first-time homebuyers since the $8,500 tax credit ended, home sales haven’t been impacted much.
“People are still buying,” Saunders said.
Fortunately for prospective homebuyers, banks also are making it easier to secure a loan. However, now they are going back to basic principles such as requiring down payments and proof you can make your payments.
Realtor Jim Soda, of Prudential Lakewood Ranch Realty, said he remembers a time when buyers would look at as many as 50 houses before making a decision. Now, with fewer on the market and for less time, buyers are moving more quickly in making their decisions.
Realtors said closings on home sales have become more difficult because buyers are requesting more thorough inspections and taking other precautionary measures. But the concern isn’t slowing home sales in light of the low interests rates and prices and other amenities the area has to offer.
“Sarasota is still the hidden gem of the area — Sarasota, Bradenton, Lakewood Ranch — with everything that’s going on,” Soda said. “There are amazing buys in the area. We may never see these numbers again.”
Contact Pam Eubanks at [email protected].