What Now, as Foreclosures Wane?

Longboat Key, Florida | February 13th, 2019 – The times appear now more challenging for real estate property investors in search of sales listings of foreclosures at bargain-level prices on the market. They are likely to encounter fewer distressed properties in the MLS of Manatee and Sarasota houses for sale, as foreclosures in the two counties have slid back to the 2006 pre-recession levels, recent industry data show.

According to a report released last month by the real estate research firm ATTOM Data Solutions, less than a half percent of all residences in Manatee and Sarasota are considered “in some form of distress” from the point of view of their lenders. Altogether, the combined foreclosures in the two counties totaled 2,100 cases in 2018, down by 4 percent from 2017 and by 90 percent from 2009.

Distressed Property Sales Thin

As another sign of the market returning to normalcy in terms foreclosures, 2018 sales of distressed properties in Manatee and Sarasota dropped by 19 percent from 2017. Closed deals on short sales, bank-owned repossessions and third-party auctions accounted for 10.2 percent of all residential property sales in the two counties last year, a slice lower that the U.S. average of 12.4 percent.

The two-county percentage ranked 130th out of 209 U.S. metro areas for distressed sales. Investors, once among the top buyers in the local housing market, accounted for just 1.4 percent of all 2018 Manatee‒Sarasota sales, an 18 percent drop for the year, ATTOM also noted.

Lesser Pricing Influence

With this prevailing scenario, valuations and market reception of traditional property listings are now less likely to be affected by a surfeit of bargain-priced foreclosures and short sales. Be that as it may, sellers still need to work closely with agents to price and position their properties properly. Like the recent exit of foreclosures as a dominant market factor, the regime of sharp price appreciations experienced in 2015 and 2016 is now also over, as per recent industry indicators.

Local prices as of December 2018, in fact, trended on a downward trajectory. In Manatee County, the median price of a single family residence slid 2.7 percent from 2017 to $309,000. While Sarasota posted a 3.6 percent median price gain in its single family houses, its condos’ median price dropped 12 percent to $220,000, while a 2.6 percent drop was posted for Manatee condos’ median price to $190,000.

Significantly, too, total sales in the Sarasota-Bradenton region retreated in December with the total turnover down 14.4 percent from a year earlier. The sales decline was experienced for all residential types, according to data from Realtor Association of Sarasota‒Manatee.

Catch the Cash Buyers

Even as investor activity appears on the wane in the Manatee-Sarasota property market, cash buyers continue to dominate in the region. ATTOM ranked our market territory fifth among the 200 U.S. metros with the largest number of cash buyers. Buyers who paid in cash account for a 45.4 percent slice of all residential sales in 2018, the research firm said.

Recently released industry data indeed indicate some significant shifts in our market. Sifting through them for an educated approach on the market by both sellers and buyers requires professional realtor advice. Contact our Judy Kepecz-Hays team to learn more how the recent trends have affected residential valuations and purchase prices.

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