Zip Codes 34285, 34292, 34293
By: Robert Goldman, PA, JD, REALTOR®
Last month I said all indicators point to sales increasing, inventory declining and prices rising. March certainly confirmed that prediction. Far and away, March was the strongest month for sales we’ve seen in some time in Venice. Here are the stats:
Inventory — homes available for sale are at an all-time low. There are only 930 homes listed for sale. This is 4.5% less than the 974 homes for sale in February, and a whopping 21.1% less than the 1,179 homes for sale in March 2011. At the current pace, there is only 4.6 months of inventory based on closed sales. This represents a dramatic 28.6% drop from the 6.5 month supply in the prior month, and a 25% reduction in the 6.1 month supply versus the same month one (1) year ago.
Sold Homes — The sheer number of homes sold is evidence that a growing number of seller’s expectations of lofty prices are now in alignment with current day reality. There were 202 homes sold in March 2012, a 33.8% increase over the 151 homes sold in the prior month. And 5.2% greater than the 192 homes sold in March 2011.
Pending Sales – Pending sales, under contract but not closed, are generally a reliable indicator of sold activity and market inventory for the next couple of months. Last month there were 292 homes under contract, 18.2% more than the 247 in February 2012, and 33.3% more than the 219 under contract for the same month one (1) year ago. This foretells that the supply of homes will continue to shrink. As buyers find less to choose from, prices are likely to increase.
Price Increases — The bottom reached, prices are now reflecting increases more in line with historically acceptable standards. Last month the median price sold was at $143/sq. ft. This is 3.6% greater than $138/sq. ft. in February 2012. Although, it is 4.7% less than $150/sq. ft. recorded in March 2011. Nevertheless, comparing the current first quarter 2012 with the same quarter last year, there was a 0.7% median price increase; $136/sq. ft. Q1 2012 versus $135/sq. ft. Q1 2011.
Days on Market — Reduced inventory (less homes available for sale), coupled with sellers being more realistic about pricing, reduced days on the market 10.7% from last month. Last month the average days on the market, before going under contract, was 108 days. It was 121 days in February.
Sold vs. List Price — Regardless of market conditions, the statistical fact remains that a home will generally not sell until such time as the list price is within 10% of the sale price. Interestingly, in March 2012, February 2012 and March 2011 there was a consistent 7% difference between the sold and final list price.
Distressed Properties (short sales and bank owned) — In Venice the real estate market has not been impacted as strongly as it has to its neighbors to the north, Sarasota, and to the south, North Port. In March 2012 only 10% of all homes for sale were Distressed Properties, 93 in all. This represents 14.3% of all sold homes, 29 out of 202 homes sold. The median sold price for all Distressed Properties was $130/sq. ft.
Buyers are savvy; the internet has given buyers the tools to determine a property’s value from the privacy of their home. If priced within 10% of market value a seller can expect an offer, and with a diminished supply of homes, often multiple offers. On the flip side, if priced greater than 10% of fair market value, a home is likely to languish on the market. Pricing a home high in order to leave room for negotiation doesn’t work. The fact is if priced too high you won’t even get the opportunity to negotiate, because buyers will not seriously consider it. And, if they see it, they will do so in order to justify the price of another home.