The downtown Sarasota housing market has cooled down a little in recent months, with some homes in Sarasota County even selling below the listing price for the
first time since 2021. As the number of closed sales on townhouses, condos, and single-family homes in Sarasota County
fell significantly year-over-year in October, median times to contract have increased by 367% for townhomes and condos, and by 186% for single-family homes. At the same time, median times to sale have increased by 48% across all categories.
Still, that does not mean sale prices are falling, and overall prices are staying relatively stable. The median sale price for townhouses and condos was up 16% year-over-year in October, while single-family homes saw a 31% increase in the same metric. For both buyers and sellers looking to the new year in home sales, forecasting what they will encounter with downtown Sarasota real estate prices and availability requires a closer look.
Cost of living in downtown Sarasota
The cost of living in downtown Sarasota is not far out of line with the national average, and Sarasota actually has a slightly
lower cost of living, overall than Florida as a whole. Housing is a major factor driving the cost of living in Sarasota, with a median home cost that is significantly higher than the national average, compared to the state as a whole, which has a median home cost in-line with the national average.
Grocery costs are also slightly higher in Sarasota, but utilities and transportation are substantially lower than both the state and national averages. Overall, while this means that purchasing a home in the downtown Sarasota housing market will cost more than in other parts of the country and even the state, residents can expect a very reasonable cost of living, which is likely a factor driving the housing demand in the area.
The overall market
Approaching the end of 2022, the overall home inventory for Florida
is still rising, though recent months have seen less significant growth than occurred between the low point in February and August, when the supply of homes grew from just under a month's supply to 2.4 months' supply. The state's home supply level is still considered quite low, with a normal market containing a six-month supply at any time, and the popularity of moving to Florida from outside the state has been a significant contributor.
At the same time, the median home price for the state has moved little since it grew to $420,000 in May—compared to $365,000 last November—only falling to $402,000 in October. Even with new construction, persistent supply chain problems and strong demand have pushed the wait for newly-constructed homes up to as much as 15 months.
Local trends
Much like the state as a whole, Sarasota itself remains a seller's market, and the housing supply is in line with the statewide level. As such, cash sales play an outsized role in the local market, and sellers are often entertaining multiple offers, especially in choice neighborhoods. In October, just over 64% of closed sales on Sarasota County townhomes and condos were cash sales, compared to only a little more than 42% of single-family home sales.
While supply is not expected to increase significantly for the area, home prices are expected to
remain relatively stable, with current downtown Sarasota real estate trends likely to carry forward into the new year.
Condos on the rise
The construction of new condos will undoubtedly have an impact on both buyers and sellers in the downtown Sarasota housing market, and approximately
1,700 new units are projected for completion between 2023 and 2024. Obviously, not all of those will have a direct effect on the market in 2023, with the projects expected to be completed before 2024 only accounting for 264 new units altogether. On the other hand, even unfinished construction with a 2024 projection for completion may have some impact on how both buyers and sellers approach the market in the coming year.
Regardless, there were only 295 newly-listed townhomes and condos in all of Sarasota County in October of this year, meaning that even a small change in available units during a particular month due to new construction could have a short-term impact. Depending on when specific projects are completed—and how closely the availability of new units is timed—the introduction of new units could create some swings in local housing availability during 2023. However, the tone of the overall market means that any sudden increases in available housing would likely only be temporary and not significantly impact overall trends.
2023 is unlikely to see major changes
The fact that Sarasota homes are staying on the market for longer before coming under contract or selling is a positive sign for buyers, but the current housing supply trends are unlikely to alter significantly going into 2023. At the same time, despite new construction, continuing delays, and unflagging demand are likely to prevent such projects from being felt in any significant way in terms of overall home supply in the downtown Sarasota housing market.
Buyers who are able to pay most or all of the sale price upfront will continue to have an advantage. In addition, while sellers have seen lower final prices than the listing price in many cases, the overall drop in final sale prices has not been significant, meaning that buyers still have the potential to receive good prices for their homes in 2023.
Mastering the downtown Sarasota housing market
Whether buying or selling a home in downtown Sarasota, the first step—and the most important—is finding an experienced realtor, such as
Judy Kepecz-Hays, who can help clients to navigate the market and make certain they not only receive the most for their money, but also leave the closing satisfied with the results.
