First, let me address three things that I believe are going to drive long-term value in our local real estate market:
“Season” gets longer and longer. I think it’s about 10 to 10 ½ months right now. While there are plenty that make Sarasota their seasonal residence, there is distinctly less seasonality. Residents are staying longer in Sarasota, and more are making it their full-time home. A prominent developer from Naples recently said that Sarasota has a vibe, energy, and amenities that Naples only wished it had. All this bodes well as it stabilizes revenue in key sectors of our economy.
Upswing in Flights. If you look at flights at our airport, flights have increased as they always do in November. However, these seasonal flights are staying around longer and longer. This correlates with what I said above. That just means we are a more year-round community.
Sarasota, Bradenton, North Port was announced to have the best job creation among small businesses in the entire country. This is great because small businesses drive our economy and tend to pay higher wages than their entrenched counterparts.
A Tug-of-War Between Buyer’s Market and Seller’s Market
In the short term, how is our real estate market? Let me comment from the perspective of whether you are a buyer or seller:
Buyers
First, I think it’s a great, great time for buyers. Yes, I said that. I think we’re in a lull right now when it comes to buying activity and I expect this to continue into the first week of 2023. As we move beyond this period and into the high season, I think it’s going to get tougher for buyers. We have a lot of buyers who are waiting in the wings as they have still not been able to secure a place here. But right at this moment, I think there’s a unique opportunity to be very, very aggressive when you find a property that you’re looking for. Inventory levels are still tight, so it’s not completely flipped to a buyer’s market. As an illustration, I was at an open house on Sunday. The agent had printed 40 flyers and those were gone within the hour. Buyers are interested in owning but are trying to interpret conflicting messages as to what to do. Yesterday during a conversation about mortgages, one company feels that the uptick in 30-year money has a 2-3 year lifespan. If that is the case, then there are attractive ARMs in the very low 5% range with a 10-year horizon. As always pay more attention to the local market to determine what is right for you.
Sellers
For sellers, I think that there is some pushback. Sellers need to do those extra couple of things that are going to make their properties easier to sell, or to put it another way, easier for a buyer to purchase. Don’t be stingy, do those extra things. We are able to advise you on the specific things that should be addressed to optimize your chances of attracting buyers. Part of the reason to do this is the cost of insurance for the next buyer.*
💡 Insurance sidebar:
* We have seen an increase in insurance premiums over the past few years. This is due to many things including the cost of materials, increased labor, and fraud within the insurance industry. Due to a roof insurance fraud scheme one person estimates that there are over 130,000 lawsuits equally about $8,000,000,000.00 in claims against insurance companies. And while storms do have an impact it remains a small piece of the cost. After all, storms in Florida are not a mystery and insurance companies have had them built into their models for decades.
To provide a concrete example: We have suggested to Sellers that even though the 18-year-old air conditioning system is blowing cold air, it is getting close if not already past its useful life. Many sellers are realizing significant gains on the sale of their properties ($200,000-$2,000,000). And while the cost ($6,000-$10,000) is not much relative to the net gain, sellers still adopt an “if it ain’t broke don’t fix it” mentally. This may not work as well with the current sellers who don’t have all of the power market. A more expensive suggestion is roof replacement. Like the air conditioning, the roof is part of the 4-point inspection required by insurance companies. Because of the widespread roof fraud, some insurance companies are requiring new owners to replace roofs if the existing roof is older than 12 years. Cash buyers have more flexibility as they can self-insure. Buyers who finance part of their purchase (regardless of how small of a percent) don’t have any flexibility. The silver lining for sellers is that new, newer roofs, and air conditioning systems reduce a buyer’s ability to “discount” a property due to the age of these items and make the property easier to sell.
For those sellers that have unique properties, I think the market is very, very stable and they should be patient, even if they get some offers that are below what they’re expecting to receive.
There’s a ton of activity here in Sarasota and with activity, we have a lot of people looking to buy and sell in the real estate market. When you’re ready to get good sound advice for your specific situation, give me a call @ 941.587.0740.
Today – one week after the storm – we walked the beach of Longboat Key. The Gulf of Mexico is quite calm, the sky is blue, the shorebirds are fishing, and it seems like nothing ever happened.
In Sarasota’s Downtown and Barrier Islands, Hurricane Ian caused very little damage to building structures. I want to expand a little bit about that. Most homes that people are purchasing today are effectively built after 2000. (For an in-depth conversation about how the county calculates an effective build date please give me a call @ 941.587.0740) What this translates to is that they are built to the highest hurricane codes and have tremendous resilience to storms like this. So, most of the damage in our area was to some trees and powerlines. Most structures went unscathed.
Sarasota’s Q3 Real Estate Sales
So, how are the numbers for the third quarter of 2022?
We were not able to complete the month of September as many closings could not happen or have not yet been reported due to the disruption of the hurricane. This will have had some impact but I can’t say exactly how much. That said, here are the numbers:
Sales are down 26% in the third quarter compared to the same period a year ago.
Luxury sales have gone up from 7 ¾ to 10 ¼ percentage points as a percentage of total sales.
The median price went up 20% from the third quarter of 2021 to the third quarter of 2022.
Our market continues to be strong, however, I think the median price may have peaked in June of this year. It dipped in July and August but then rose again in the month of September. While our median price is significantly higher than it was last year, though it is just slightly higher than the median price of real estate in Florida. In my mind, this makes sense as Sarasota offers much more in terms of natural and cultural amenities than most other cities throughout the state.
My prognosis for the rest of the year is that we will have a very, very tight supply. We may have an increase in demand because of the tragedies to the south of us. So much inventory along our Gulf Coast is not currently sellable, which I suspect is going to put pressure on already reduced inventories. More people are likely to be coming to our area looking for real estate both for renting and buying. So, I would say here in Sarasota things look very bright indeed for our community.
If you are a property owner and want us to give you a video walk-through of your personal residence to see how it did in the storm let us know and we’re happy to do that.
When you have a question specific to your situation, please give me a call @ 941.587.0740.
With lots of construction fences, barricades, and earth-moving equipment around our city, I am encouraged about the construction progress here in Sarasota this summer.
I want to highlight just five projects that are shaping Sarasota’s future:
Selby Gardens. The Living Energy Access Facility, which will house the parking, gift shop and garden-level restaurant is taking shape. This will make Selby Gardens the world’s first net-positive botanical garden complex. With a 50,000 sq ft solar array at the top, this net-positive structure will produce the energy needs for the Gardens and have excess to share.The goal is to make this a world-class destination for plant research, conservation, and environmental education, bringing the physical structure up to the same level as all the research that’s going on.
Bayso in Downtown Sarasota at The Quay, which anchors the south and eastern corners, is now about to be topped off. This is going to bring about 150 new residences to the downtown.
Belpointe, which anchors the east end of Main Street, is bringing about 400 much-needed residential rental units to Downtown Sarasota.
Downtown Roundabout. The much talked about roundabout at Gulfstream and 41 has another change in its thoroughfare. Its completion is due in the next several months. We are about to have a new way to experience entering and leaving the barrier islands.
The Bay. The first place in Downtown Sarasota where the barricades are going down is The Bay! On October 14th we begin a 10-day celebration of this iconic 53-acre destination. It’s really impressive the places of nature and kids places they are about to unveil. This project shows that with great imagination and a great team there is no ceiling for developing our Bayfront, which is now going to provide free public access all the way from Island Park and Marina Jacks up to 10th Street.
These are some of the great things that are happening here in Sarasota. It’s great for our real estate market and for the greater community.
Stay tuned for more information about Downtown Sarasota: 941.587.0740.
Today I want to address the passing of loved ones and the subsequent process of clearing, preparing and selling any real estate that the surviving spouse and/or heirs no longer want to maintain. At our real estate firm, Investments In Sarasota, we’ve been helping families tackle the complexities of liquidating their real estate holdings in this highly stressful and emotional time.
Our goal with each situation is to be present for our clients to expertly guide the process. While each circumstance is unique and personal, we have created processes that work to minimize the anxiety of clearing and preparing the property for sale, ensure the descendants are protected against future liability and maximize the financial return based on our know-how on the most effective ways to prepare and position the property.
There are three key stages in this process that we would like to highlight here:
1) Clearing the Contents of the Property and Presenting it for Sale
After family and friends have been able to claim the items of sentimental value, we have the resources to repurpose the personal effects, furniture, and accessories — whether it’s donating to charities directly or doing the estate sale and then having the proceeds go to the family or charity that meant the most to the deceased. We also consult with the family to determine what work will present the property in the best light to maximize the return at the point of sale. Our recommendations are tailored to each individual situation. This may include cosmetic improvements, strategic upgrades, deep cleaning, etc. When the heirs are not local, we are available on the ground to help to facilitate and ensure all work is executed smoothly.
2) Protecting Heirs from Future Liability
We structure the deal in a very special way to either reduce or eliminate any future liability. This is done in the selection of the contract used, fine-tuning the terms of the contract, and preparing certain disclosures. For many, the actual sale of the property is the hardest part due to sentimental attachment and an abundance of memories from time spent there. Part of the selling and closing process is finding time for the last visit to the property that may be for a meal, gathering, or short vacation for surviving family if wanted or needed.
3) Ensuring Correct Documentation is in Order
Finally, our legal team ensures that all the correct documents are in place. The settlement agent may need things such as the death certificate, the estate tax clearance, the trust document, and/or the trust affidavit. We understand the Florida Statutes which are applicable to handle the nuances that may not be known to the heirs. For example, if there may be liabilities, things such as bankruptcy protection continue through the surviving spouse, but not to heirs. Once the property has closed- the goal is to be able to move forward gracefully at least from this part of the estate.
Fortunately, life expectancies do increase while living in Florida because of the vibrant and active lifestyle that our residents enjoy year-round. However, it doesn’t go on forever.
Our real estate brokerage specialize in working with estates to provide the full spectrum of support for these highly emotional transitions. Whether you want to know the value of the property, understand its rental potential, or decide to sell, we are here to support you: 941.587.0740.
Happy July! It’s summer vacation – especially for the young and the young at heart. Here in Sarasota, it’s the second busiest month for travel and tourism.
I want to talk about the Sarasota real estate numbers for the second quarter (April through June) of 2022. The numbers obviously are looking backward and don’t give us a true indication of what’s going to happen in the future, but here we go:
Sales are down by 19.8% in the second quarter compared to the same period a year ago.
The luxury market (sales over 1M) has declined 9.65%.
Inventory is up 110% just in the last 90 days. Yet it is still only 6 weeks of inventory.
What does all this mean?
Sarasota has not changed that much in the last 2 weeks, 6 months, or 2 years. It’s still a great place and people continue to come here. What I learned as a student in the public school system here in Sarasota is that the basic economics of supply and demand still hold true.
Sarasota still suffers from a lack of GOOD inventory. Yes, the fair inventory isn’t selling as quickly. But the GREAT stuff is still selling, and Sarasota has more buyers than sellers. But because of a lack of good options, they are staying on the sidelines.
And what do I mean by a lack of good choices? Properties that are in favorable condition with a location and lifestyle experience that many buyers covet. Let’s take a look at a good example for illustration:
St Armands Towers
Lido Key beachfront condo. One block to St Armands Circle.
2 Beds | 2 Baths | 1,275 sq. ft. | $1,275,000 View Details Here ➤
This week St Armands Tower, where many of our clients own, just had its first unit go on the market in 17 months. The last unit for sale in there was February 14th, 2021. That was a long time ago. Our market is made up of very savvy buyers and sellers and we’ll soon see what price this unit sells for. This unit is currently listed for $1,275,000. It sold for $623,000 six years ago. There have been no major improvements. I don’t know if the asking price is egregious,
but the market feedback comes very quickly in this environment. The sales price reflects an annual appreciation of 12.5%, which is a little more than double the historical average for waterfront condominiums. By the time you’re watching this or reading this – there can be only one of three things that have happened: it’s gone under contract, there’s been a price reduction, or they’re staying the course. But this illustrates our challenge here in Sarasota. Just one unit in 17 months!
If you’re living in a location that brings you JOY, I encourage you to stay put. If not, let us know and we’ll help you find a location that’ll bring much more JOY to your life. Think about where you want to live and how you want to live.
Sarasota is no different than any other place. We’re experiencing our change just like many other places throughout the country and throughout the world. However, don’t become complacent and get glued to the unpredictability of the future. Live life – that’s what we all want to have.
When you’re ready to make a change, please give me a call @ 941.587.0740.
If you are a Seller, we want you to know that WHO you choose to represent your property and your interests is paramount. Without the right Sarasota Realtor, you risk losing time, money, and the proper protections should anything go wrong.
Here are the key elements you must know to sell in the shortest amount of time, at the highest value, with the least impact on your day to day life.
1. Your Realtor: Your Greatest Asset or a Liability?
Believe it or not, Realtors have a reputation amongst their peers. This person can attract showings from other agents just based on the respect they have garnered in the local real estate community.
Their good standing with their own peers and ability to negotiate solutions to unforeseen circumstances are critical factors in facilitating the exposure of your property and securing a sale that works for you.
We have had many experiences where a listing agent’s lack of knowledge and skill actually loses the sale. Other things being equal, sometimes buyers agents will factor in which properties they will show based on how effective the listing agent is, i.e., how good are they to work with.
So WHO YOU CHOOSE as your Realtor is not a choice you should take lightly. You should be just as discerning in choosing your Realtor as you are in choosing the best medical or legal practitioner.
A Critical Business Partner, Not a Clerk
Your Realtor works as the “point-person” to manage the entire selling process for/with you. As such, you must be confident they are capable in all of the following:
Demonstrate digital marketing expertise
Possess solid knowledge of your property’s market niche
Have access to both domestic and international peers
Practice real estate as a profession, not a vocation
Have a great rapport and connection to the professional Realtor community
Have exceptional communication and writing skills
Authoritatively advise you on every aspect we discuss in this article
He or she will guide you on how to achieve the most favorable outcome throughout the process, especially during negotiations of the contract and with any subsequent issues that may arise during the due diligence process.
While you need a professional with extensive experience, it is also critical that your Realtor is capable of staying on top of emerging technologies. If your Realtor is still operating his or her business like your grandmother’s real estate agent, then your property is likely to be at a disadvantage from the outset.
The industry is changing rapidly and your choice in who represents your property, how they position it, and their skills in negotiation, offer real value.
2. Traditional Real Estate Marketing is No Longer Enough
As a Seller, your primary reason for hiring a Realtor is to market your property effectively. REAL ESTATE MARKETING IN THIS DIGITAL AGE bears little resemblance to how your parents’ Realtor operated.
In today’s media driven society, an effective real estate marketing strategy requires the know-how to transcend both language and geographic barriers. It must be able to be working for you 24/7 in a GLOBAL market.
Getting the property in MLS is only the beginning. By having your property in the MLS, the listing is accessible to all Realtors working in your area, as well as syndicated to hundreds of consumer internet sites. Only Realtors can post to the MLS, and this listing is critical as this is where other Realtors go to source property for their active buyers.
However, the BIGGER question is what does your Realtor do beyond the MLS? Print advertising is old school and, in today’s digital age, it is highly ineffective. 92% of all buyers search the internet during the home buying process. A significant internet presence is a key advantage in getting your property both seen and sold.
Two critical questions you should ask a prospective Realtor are:
How will they leverage video and aerial technology to tell the story of your home?
What other ways will they use technology and social media to market your property?
The ways in which your Realtor should market your property MUST include:
The contact and networking skills to access the INTERNATIONAL market as 25% of all dollars in Florida come from Global Buyers
Excellent professional scripting and videography
Excellent professional aerial and property photographs
The Know-How to optimize listings in Realtor.com, IDX, Zillow, and Trulia
Knowledge of SEARCH ENGINE OPTIMIZATION
A comprehensive Social Media Promotional Strategy.
When you are selling a home in Sarasota, it is important to remember the property is being marketed to two constituents, consumers and realtors. Although many think that marketing should be purely consumer focused, we maintain that, while this is important, the primary focus should be on how to reach the Realtor community.
After all, well over 90% of all properties sold are sold by Realtors. And this again requires a well connected, well respected, experienced Realtor.
If you are listing a luxury property, particularly waterfront, know that you are selling the story of the lifestyle. Nothing tells that story better than full motion video with aerial footage. Here is an example of a video we scripted, directed and produced for a Siesta Key listing:
3. Preparing and Staging Your Property — Do You Risk Leaving Money on the Table?
The primary goal in preparing your property for sale is to make it as easy as possible for other people to buy it. That means making it easy for buyers to visualize the use of the space and to see themselves either in it or easily able to rent it. Most buyers are not keen on needing to do a lot of work to a property, they just want to enjoy the home, or rent it out straight away.
Because many owners grow accustomed to the eccentricities of their homes, they may fail to realize that a few simple changes or improvements could drastically increase the marketability of their property.
Simple Fixes That Command Higher Return
Sometimes it’s as simple as a fresh paint job, a deep clean, removing excess furniture and clutter, making minor repairs, or tearing up carpet to reveal hardwood floors. On the other hand, a Realtor might suggest larger improvements—like renovating a kitchen or bathroom—that will considerably raise the value of the home.
The Virtues of Staging
In many situations we recommend to our clients that they consult a professional stager before they list their home. In our opinion, staging a house is a very strategic way to improve its look and feel. We have seen firsthand dramatic transformations of interior spaces through staging.
A stager has an eye for how to use fixtures, furniture, colors, and accessories in such a way as to make a home look bigger, brighter, cleaner, warmer, more loving and, best of all, more appealing to home buyers.
Larger Improvements May Net You More
In the case of a property that is significantly outdated and/or in disrepair there may be a chance that the next buyer tears it down and builds a new home. Still, it may make sense to perform certain improvements and repairs in order to achieve the highest possible market price.
The buyer will place zero value on the structure if they see it as unsalvageable, and, therefore, will only want to pay land value. However, if the house has redeemable value, the tear-down buyer should still have to pay something for the structure even though they will not use it.
Case Study: Our Bird Key Listing That Went From Tear Down To Top Dollar
This was the case with a particular client we had on Bird Key in Sarasota. In this case, the client’s parents had recently passed away and they contacted us to list the property for sale. Upon visiting the site, we realized immediately that, most likely, at least 70% of prospective buyers would tear down and rebuild. The house was both outdated and in disrepair.
We had the house pre-inspected in order to discover the simplest and most cost effective fixes in order to ensure that the property was both functional and habitable. In this case, the client spent an extra $5,000 to $10,000 in real money up front and, as a result, made an extra $150,000 to $200,000 on the sale.
It is the responsibility of your Realtor to be able to determine the most effective means to prepare your property for sale. In this case, we acted to ensure that the Buyer was not able to discount the value of the structure and purchase the property based solely on the land value and intended use.
4. How You Structure Your Listing Agreement Counts
Here in Florida, when a homeowner is selling a property, an exclusive contract called a Listing Agreement is used. In a Listing Agreement, the seller elects to work with one agent/broker on the sale of the house for a defined amount of time.
Typically the length of a Listing Agreement is six months to one year. At the end of that time, if the property has not sold, the homeowner may decide to either renew the Agreement, take the home off of the market or find another agent.
Many Realtors work as “transaction agents” by default. This means that unless specifically stated and agreed to in writing, they don’t represent either the buyer or the seller, as they are responsible for facilitating the transaction.
We recommend that in the Listing Agreement you, as the seller, specify that you want a single agency relationship. This means the professional you hire has a fiduciary responsibility to you, they’re not representing the transaction, they’re representing your needs and working for you, to get the results you want.
5. THE PARAMOUNT ISSUE OF PRICE- ARE YOU A REAL SELLER?
No matter how much energy is put into preparing, positioning and marketing a listing, in the end it all goes back to the price. It is important to establish a listing price that generates interest in the way of inquiries and showings.
There are some neighborhoods that the moment a new property comes to market everyone wants to see it because there is a high demand for the neighborhood. However, buyers need to see value in the property and if the price is listed well above the perceived value, potential buyers may shy away from making offers.
An experienced Realtor should know all the nuances of a particular market in order to make the most accurate assessment of the maximum selling price the property can hope to achieve, without alienating buyers by over pricing. Most aim to price the property so that they can achieve a fast and smooth sale.
Once the price is decided, the surest feedback will come from the market. The market will tell you quite clearly, either by lack of viewings, lack of offers, or low offers, how accurate the listing price is.
In Florida it is quite rare that a property sells at the price it is listed. Some properties are well priced, meaning they are fairly in line with the market value, and some are not. It is incumbent on your Realtor to help any potential buyers (usually by working with their Realtor) understand the value in your property, and to try to negotiate as close to the listing price as the market data supports.
Like what you’ve read? Please share with your friends and colleagues.
Last month I began describing the changes that are coming to Sarasota. My team and I have been looking extensively at how major development, investment in the public spaces and amenities, and philanthropic moves are building momentum to a Downtown Sarasota that will be totally different in 5 years. I have coined this as “Sarasota’s Great Transformation 2027.” (Click here to see Part I)
Much of our focus on development in Downtown Sarasota until this point has been on the western end of town with plans for new luxury condo buildings, hotels, and mixed use residential most notably in The Quay Sarasota. On Golden Gate Point there are also new projects such as The Peninsula and Evolution.
Now I want to take a deeper look at some of the larger developments in the works to provide more context for the transformation underway in Downtown Sarasota.
Belpointe, Benderson, and Capstone Making Major Investments
We are seeing a lot of infill development in the downtown core. I want to start by taking a look at the activity with Belpointe. They are a Real Estate Investment Trust (REIT) out of Connecticut that is publicly traded. They have purchased 7 parcels — all of which are going to be developed into apartments. This is a positive thing because it should lower the cost of rent by increasing supply.
Belpointe’s primary projects right now are going to be at the location of the former Sarasota Main Plaza (next to Hollywood 11). On this site they’re going to build two buildings. The main floor will be retail based on downtown zoning, and then apartments above. They’ve also purchased the adjacent outparcel where Staples used to be, and they are going to build more there.
The other significant purchase they’ve made is next to the Ringling post office where they bought the former Verizon (now Frontier) building. That’s over two acres where they will also build more apartment buildings. Belpointe is motivated by cash flow and they are publicly traded so they need to be putting their money to work.
Other developments that we’re going to see in the near future are going to be the former Williams-Parker parcel, which is over an acre and a half. This will become a residential/mixed use development. Just across Cross street, Capstone purchased over an acre by assembling several smaller parcels and they’re going to develop there as well. In addition, just down the street on Orange Ave an assisted living facility will be constructed.
Benderson, the large developer originally out of Buffalo (UTC and Southgate Malls), has purchased the Sarasota County Administration Building and they’re going to develop a project there. That’s over 2 acres just in that spot. There are also other hotels and smaller developments planned throughout Downtown Sarasota.
Stay tuned for the next in our series to illustrate the breadth of investment and change coming to our area.
Sarasota’s Future: Bullish or Bearish?
As we move into the third decade of the 21st century, there are three things I think Sarasota needs to do as a community- both in the public and the private sector- to develop more economic, educational, and environmental resiliency for the future of our community.
BETTER JOBS. As I have spoken about over and over again, we need better, higher paying jobs and we need more of them. We need diversification of different economic sectors.
BETTER TRAINED GRADUATES. Educationally, we need the local institutions of higher education, vocational schools, and two-year or four-year institutions to step up their game. They need to be producing more and better prepared graduates for the jobs in the 21st century.
CLEAN WATER. And finally on the environmental front, the water is our life blood and we need to do everything that we can to sustain and improve the quality of the water.
All this said, we’re VERY, VERY bullish on the future of Downtown Sarasota. As illustrated, lots of intelligent people who’ve done their homework are investing millions upon millions of dollars in developing our community. I am really excited about the Great Transformation 2027.
We look forward to being your trusted real estate advisor so that you can experience a return on your Sarasota real estate investments — both in money and happiness.
Today I want to share a cursory introduction to what I am calling the Great Sarasota Transformation 2027. There’s going to be a lot going on in the next five years, and it’s already starting. This includes a multi-faceted look into philanthropy, addition/improvement of amenities, and development. As we release our next few videos, we’ll be going into much more in-depth.
Philanthropy is a huge part of this community and there are individuals that have already invested over $50 million dollars here in our area. The greatest portion of these funds is being invested in the amenities – which will be available and accessible for all residents. We’re seeing it happen right now as Selby Garden’s new facilities come out of the ground. The Sarasota Bay Conservancy (where the Van Wezel currently stands) is also undergoing great changes to become a public destination with attractions for all ages and a range of interests.
On the development side, I want to touch on the west end of downtown Sarasota – I’m calling it Kolter Town. They have already delivered us The Ritz Residences, Bayso, The Mark, and The Vue. Kolter already has decided that they’re going to build a fifth – and teasing about a sixth – building in Downtown Sarasota. They’re also going to be opening their third hotel behind Embassy Suites and the Westin. This is great news for the western part of downtown Sarasota because Kolter has already proven to be a leader in luxury buildings, which is a benefit to Sarasota.
Is Supply for Sarasota Real Estate Finally Increasing?
Lots of people have been talking about inventory. This is something that I track daily as we have a myriad of clients intent on owning a piece of our local paradise. Yes, it’s up by about 15% in the last 3 weeks. However, the reality is that in the most desirable neighborhoods in Sarasota we’ve seen very little change in inventory levels. In fact, on Longboat Key there’s actually a decrease in inventory.
💡 What This Means: Fewer properties are coming to market than are going under contract.
The inventory on Siesta Key, West of Trail area, and Palmer Ranch is a little flat. In Downtown Sarasota, Bird Key, and St Armands Key we’ve seen a slight uptick in available properties.
The Northern Migration Lull
Looking at Sarasota County as a whole, people are saying “Look! Inventory is increasing!” This is because we’re in the midst of our third migration of winter visitors back up north. The first northern migration occurs annually on March 31st/April 1st, the second is after the spring holidays of Easter and Passover. In May the remaining winter residents head to their “other” residence(s). May is typically a slower period before our next onslaught of visitors who come for the summer.
And even though the migration is underway and with there is a slight increase in properties available in certain communities, our market is still quite competitive for buyers. In fact, our team helped a Seller receive a 71% gain on the sale of their Siesta Key waterfront property from just a little bit earlier than a year ago. We accomplished this through a strategic marketing plan that attracted several out-of-town offers, and in fact, the property was purchased by an individual who was remote the entire transaction. Last week, we represented our client who finally found the perfect property and was ready to buy. We structured an offer that prevailed in a six offer situation.
Stay tuned for next month when I give you more insight into the dramatic transformation that’s going to happen during the next five years here in Sarasota. If you are in any way considering new and pre-construction condos in Downtown Sarasota, I encourage you to call me @ 941 587 0740 immediately so that I can educate you and help you establish your goals in this purchase. With all the changes on the horizon, it is critical you be fully informed about all the choices and factors that will impact your long-term happiness.
Unless you are living with your head in the sand- no pun intended- there’s a lot going on in the world. But, if you’re a buyer of Sarasota real estate you have to be laser focused on the task at hand. That’s because, like everywhere else in the world, we have supply chain issues. This played out in the first quarter’s numbers for 2022:
Sales are down 25% from the same period a year ago. This is actually the lowest number in over seven quarters. Again, this is because of the lack of housing inventory.
The luxury market (1M+) is down 19% from the same period a year ago. However, the luxury market as a percentage of total sales is increasing. Nearly 1 in 10 properties sold is in the luxury segment. This is a chicken and egg scenario. Are Sarasota’s property values increasing or are people more comfortable investing larger sums of money into Sarasota?
The median price is up 27% from the same period a year ago. What’s happening in the greater world is happening here. Can we expect property owners to become sellers? That’s hard to imagine as when you live in a beautiful place like this, where else are you going to go?
New Construction in Sarasota’s Downtown and Barrier Islands
As I have reported recently, there’s lots going on with new construction in Downtown Sarasota. The demand for new construction is most notably demonstrated with One Park in The Quay. There’s tremendous sales velocity there. In their first 90 days they have closed nearly 70 units, which is nearly half sold out.
When you need professional guidance on navigating this complex market, give me a call @ 941 587 0740.. It is imperative more than ever to be diligent and fully prepared when buying or selling in this market.
What You Don’t Know May Cost You in Time, Money, And Happiness
When buyers enter the process of purchasing new construction unrepresented, they typically don’t know all the questions they should be asking, nor the protections that should be put in place on their behalf. They unwittingly put themselves at a distinct disadvantage contractually, financially, and as it relates to making the right decisions for their lifestyle goals.
By working with a Realtor who has extensive experience in the local market AND expertise in Sarasota’s new developments, buyers can ensure they are equipped to make fully informed decisions. Having someone that is advocating for their interests every step of the way leads to more favorable outcomes and peace of mind.
WHY should buyers work with a seasoned Realtor for new construction purchases? Here are the top 4 reasons they collectively shared:
1. You Don’t Get a Better Price if You Work Directly With the Developer.
It is a common misconception among buyers that if they do not have a Realtor, they will get a better price. Realtor compensation is already built into the financials of each project. Each developer/builder wants to sell their product. They rely heavily on Realtors to bring them customers. You as the buyer do not save if you don’t use one, nor does it cost you more if you do (see #4).
If you are not represented by a professional who fully understands the dynamics of the local real estate market – both existing inventory and new construction – you are in fact putting yourself at a disadvantage on a variety of fronts.
“I believe that one of the most common misconceptions from buyers is that if they do not have a Realtor representing them, they will get a better deal from the developer. This is completely untrue.”
Lynn Morris | The Residences | St Regis Longboat Key Resort
2. All New Construction Contracts Favor Developers/Builders.
New Construction contracts and associated condo documents can be a daunting hundreds of pages long. A savvy Realtor knows how to guide you on what things may be negotiated on your behalf, introduce options that you may not have even considered, then work as your advocate to get the most favorable terms. This could be internal modifications to the build out. You may want to alter the floor plan and/or ask for design upgrades. It may also be changes to the contract itself — for example, you want to add performance benchmarks or financing thresholds to hold the developer more accountable.
We have our finger on the pulse of the market and are able to identify which resources and experts to bring to the table for every specific buyer’s needs. For example, we can introduce our buyers to specific local attorneys that have had success negotiating with a particular developer.
Our experience negotiating with each specific developer enables us to get as much accomplished for you as the buyer as possible. We can tell you if something is reasonable or if it’s not reasonable. We understand what details should be flushed out at the contract stage all the way through to how to protect your interests during the final walk-through prior to closing.
“Lee adds incredible value to the buyer’s home purchasing journey in a number of ways. His previous experience working with buyers in new construction projects allows his buyers to feel confident with the decisions they make. They can rely on his good judgment with things like price, availability, and quality.”
Nicole Christie | Attorney at Law | Williams Parker
What is an Amendment?
Modifications to contracts are called amendments. Amendments spell out changes a buyer wants to make to the developer’s contract. Amendments are made to clarify developmental milestones such as release of money to the developer, or requirements that the developer sell a certain number of units. They can also address internal design modifications such as additional closet space, livings spaces, or doors/walls.
Amendments are drawn up after the buyer goes to contract and within the 15-day recission period that is spelled out by Florida statute. This 15-day period is legally provided to all buyers of new construction.
To provide two examples:
We have a client at The St Regis Longboat Key Resort who modified a closet space to add a bunk room to accommodate their young grandchildren. They also were able to carve out a desk space from the existing wet bar that enabled them to have a private office nook.
Another luxury waterfront condo buyer reserved the right to cancel if the developer did not have a construction loan in place by a certain date.
Amendments are typically written by the buyer’s real estate attorney with input from the Realtor and the developer’s sales rep. Negotiations may take several iterations for both parties to find common ground and come to an agreement.
3. Working With an Experienced Realtor Empowers You to Feel Confident About Your Decisions.
Your real estate purchase is one of the biggest investments you make. It is important to understand all the options and the trade-offs when comparing the builders, the brands, locations, floor plans, resale potential, and relative pricing so that you know you are making the right decision for you.
We understand the local landscape and can provide comparables for historic, current, and future pricing on a property. We help you understand if a specific property’s value is going up or down in the future based on what is happening around it.
When you partner with us, we will ask you the hard questions to get you to think about what you really want. These types of conversations are important to get to what is the best match for you personally.
To provide a reference point, if you are looking at Downtown Sarasota New Construction, there is a distinct personality to each area. The lifestyle and amenities available at The Quay is unique to The Rosemary District or Golden Gate Point. None of these is better or worse, just different. We feel it is super important to understand all these subtleties when evaluating the best match for any specific buyer.
Even within a single building, there is an array of choices. Let’s take a beachfront building like Rosewood Residences Lido Key where are on the surface it may seem that the units are fairly homogeneous. However, you will have a different experience based on the floor plan and level you choose. Lower floors provide more connectivity to that water, more sounds of the environment. Higher floors offer bigger, broader views. And yet, because the water is not as close you may not feel as connected to it. This is just one example of the many factors we help you to consider.
“A good Realtor helps frame the tradeoffs not only between two new construction projects but also between a new project and an existing community. Also, it allows buyers who are relocating or who may be newer to a certain area to have local experts who can educate them about future growth and development or lifestyle differences that may not be readily apparent.”
Nicole Christie | Attorney at Law | Williams Parker
4. It Costs You Nothing to Have Professional Representation.
In fact, there may be costs to NOT having it. Realtors’ compensation is paid from the proceeds of the Seller, so there is no financial outlay for you as a buyer.
Our team works systematically to help each buyer process every option available to them, gain clarity on what they are NOT choosing as much as what they are, and emerge with peace of mind that they are making the right choice for their needs. Our real estate market offers diverse products, price points, and lifestyle experiences. The goal is to ensure our clients’ financial and lifestyle goals have been thoroughly addressed, ensuring their long-term happiness and enjoyment.
Is New Construction Really Right for You?
Many buyers in our Sarasota Real Estate market are drawn to the idea of buying into new construction projects. The allure of new is driven by the investment value of buying at pre-construction pricing, the intrigue, and ease of having the latest in design/technology and building codes, and sometimes because of the sheer lack of existing housing inventory.
There are situations where buyers — particularly those new to the Sarasota real estate market — are lured into the “sexiness” of new construction, but then as we take them on a deeper dive into their wants and needs, we figure out that new construction may not actually be the best match for them.
💡 Pro Tip:
We had a buyer who was new to the Sarasota real estate market. He initially inquired about One Park in The Quay district in Downtown Sarasota. When we engaged him on the journey of learning what lifestyle he really wanted here, it became clear that Downtown was not the right match for him and his family. This sort of upfront homework is priceless when it comes to long-term happiness.
The number of choices one has in the Sarasota real estate market begins to multiply when you consider the living experience within each geography. There are various areas of downtown, the mainland, or each distinct barrier island. Each area is then comprised of many distinct neighborhoods, and then even each street has its own feel and character.
Geography aside, there are a series of trade-offs involved in considering house vs. condo, bay view vs. gulf view vs. canal view, boating water vs. beach, old vs. new, updated vs. needs work, resale value, condo or HOA fees, floor plans, etc., etc.
Drilling even deeper, if one is considering a specific new construction project in Sarasota such as One Park, there are 11 distinct floor plans. The price of the units varies according to the level they are on, the direction they face, the square footage, etc. We carefully evaluate with each buyer the considerations regarding which may have a view and which won’t, if that view can be obscured based on what we know about future construction, which sides of the building may be more desirable based on sun patterns, noise, etc.
Good Advice Pays Dividends
Sarasota is now in its third century and going through many amazing changes. What it is going to look like in the next several generations is very different than what it is now. It pays many dividends to be thoughtful and thorough in your lifestyle and financial investment.
Whether a buyers or sellers real estate market, good information should not be considered a luxury especially when transactions are $1M, $5M, or even $10M.
Make sure you have great advice so that you have financial and lifestyle decision that you are proud of for many, many years to come. Any questions, call us at 941 587 0740.
WORK WITH US
We offer the highest level of expertise, service, and integrity.
The Investments In Sarasota team has the most depth of experience, training, and education in the local real estate market. With our concierge-style service, we support and protect our client’s interests to levels far beyond the industry norm. The rave reviews from our clients say it best.
We Know More. We Care More. We Do More.
Contact Us
NEWSLETTER
For exclusive news and market updates sign up for our newsletter.
Believe it or not, Realtors have a reputation amongst their peers. This person can attract showings from other agents just based on the respect they have garnered in the local real estate community.
Here in Florida, when a homeowner is selling a property, an exclusive contract called a Listing Agreement is used. In a Listing Agreement, the seller elects to work with one agent/broker on the sale of the house for a defined amount of time.
