So, where is the market heading?  How is it trending?  In a nutshell, there are more houses coming on the market.  However, there are less homes selling.  Result: the inventory of homes available for sale, based on closed sales, is increasing.  Although prices continue to increase, in the short term, the pace of appreciation is showing signs of slowing down.

The Stats:

1. For Sale: 4,062 homes for sale in May 2016; 3,363 homes for sale in May 2015 – 20.8% increase.
2. Sold: 1,173 closed sales in May 2016; 1,233 closed sales in May 2015 – 4.9% decrease.
3. Pended (under contract): 1,183 homes under contract in May 2016; 1,162 homes under contract in May 2015 – 1.8% increase.  Although this represents an increase in the number of homes that went under contract in May 2016 vs. May 2015, considering that there were 20.8% more homes for sale in May 2016 vs. May 2015, a 1.8% increase in pended sales implies a weakening market.
4. Average Sold Price per Square Foot: $207/sq. ft. in May 2016; $193/sq. ft. in May 2015 – 7.3% increase.  We have experienced double digit increases since the end of January 2012.

Heretofore, since January 2012 when the market began to turn to the upside, we have generally had double digit increases.  A 7.3% average sold price per square foot increase in May 2016 over the same month last year is a sign that continued price appreciation, although in play, is, in the face of an increase in the number of homes for sale, showing signs of moderating.

This is further buttressed by my work experience, selling homes in Sarasota County.  I am seeing some push back from buyers on the heretofore annual — going back to 2012 — of double digit price appreciation.  Current price appreciation, in single digits, is supportable.  However, I do not believe that the market will continue to support double digit annual increases.  We are experiencing a slowdown in the market, although based on supportable prices.  And that, is a good thing.