Sarasota County continues to have a critical shortage of homes for sale, and it does not appear to be changing any time soon.  Notwithstanding the spike in mortgage rates to 6.02% last week, the highest since the financial crisis of 2008, fewer homes are for sale, resulting in less sold homes.  Not only are more buyers sidelined due to higher mortgage rates, but prospective sellers continue to sit on the sidelines as well.  The housing market has been cooling, particularly at the upper end, but there is insufficient data for me to call that prices are trending down. Consequently, with equity appreciation at over 50% since the onslaught of the pandemic, there is little  motivation to sell.

Sellers continue to have the upper hand. However, the days of multiple offers have tapered dramatically, providing shrewd buyers with the ability to negotiate more favorable terms and conditions.

In August, inventory of homes for sale was down 3.8% from July, to 1,099 active existing single family homes.  Three years ago, August 2019, there were 1,850 existing single family homes for sale.  I look to 2019, because it was a healthy, more balanced housing market, when the median sold price increased 6.4% from 2018, not the ravenous 25% annual appreciation rate since COVID.  We need to get to 1,500 – 2,000 active listings to create a healthy and sustainable housing market. But considering how far we must go, that is going to take time, at best, a late 2023 story.

I will be closely monitoring increasing days on the market, currently 27 days, up 28.6% from last month, the highest number of days since April 2021; the median active list price, currently $599,000, only 1.6% less than July 2022; sold to original list price ratio, in August it was 93% – a red flag of price resistance from buyers; average square foot sold price, down 2.2% month over month; and median sold price, which actually went down 9.6% to $470,000, a second red flag – however, already up to $505,000 for the first 2 weeks in September. One month does not make a trend.  But, I will be carefully studying the confluence of all of these factors, over the next few months.