It seems we’re getting bombarded with conflicting statistics and information regarding the pace of home sales and values in Sarasota County.  Within just the last two days several news outlets have reported that home prices, in line with data from Case-Shiller, fell 3% in the first quarter of this year from the fourth quarter of 2010.  Nevertheless, relying on Zillow, on Monday the Herald Tribune reported that Sarasota has bucked that trend — that here home sales increased 0.1% from the previous month.  http://www.heraldtribune.com/article/20110510/ARCHIVES/105101033 http://www.zillow.com/local-info/.  Yet, according to the same report from Zillow, home sale prices on a year to year comparison dropped 7.7% in our market.  So, does one-month make for a reliable trend?  The short answer is “NO”. http://www.zillow.com/blog/2011-05-08/first-quarter-brings-more-dismal-news-for-housing-market-publish-sun-901-p-m/. http://www.economist.com/blogs/freeexchange/2011/05/housing_markets. http://online.wsj.com/article/SB10001424052748704810504576309532810406782.html?KEYWORDS=home+market+tumbles. http://insiderealestate.heraldtribune.com/2011/05/10/regions-home-sales-up-11-percent-in-first-quarter/

So, where are we heading?  What is the current state of our local real estate market?  Well, 2,727 homes were sold in the Sarasota-Bradenton market for Q1 2011.  That equates to an 11% increase from a year ago.  However, the median sales price dropped 9% from the same time last year to $144,500.  That would seem to indicate that sales have picked up steam, but that prices continue to drop — and, as every REALTOR® knows and as reported by local REALTOR® boards, inventory is shrinking.

Typically, when inventory/supply is low, the price goes up — it’s the law of supply and demand.  However, we are living in an atypical economic environment.  Distressed properties, which have been held back from the market due to the foreclosure moratorium and Florida’s overtaxed court system, are likely to be brought to market, in record numbers, over the next six months.  These properties will sell at a deep discount to traditional, non-distressed properties.  Their impact will certainly materially and adversely affect the valuation of most properties.  Further, it is anticipated that interest rates have no place to go but up.  Higher interest rates will further depress property valuations and/or reduce the number of qualified buyers.

The result is that if you intend to sell or buy your home, there has probably been no better time to do so than now.