But they are in for a rude awakening. They find a house they like, want to put down an offer and find themselves fifth or sixth in line among multiple offers. As buyers, they discover out quickly that in Sarasota, they’re no longer in the power position. The reason? Not enough homes for the demand.
As Sarasota goes, so goes the nation!
Sarasota may have been the first market in the United States to tank when the housing bubble burst, leading the plunge into real estate chaos and economic recession. But it has also recovered earlier, along with other parts of the country, notably Alaska, Washington State, Arizona and other cities in Florida – Miami, Orlando and Ft. Lauderdale, which have become hot markets again.
In June, the number of homes listed for sale nationwide dropped 24% compared with the previous year. Inventory in Sarasota has been low here for months now. Good properties, priced right, get snapped up in days with multiple offers from five to fifteen buyers not at all unusual. Prices are inching up, too, and there are even occasional bidding wars. Add it all up, and it spells “seller’s market.”
The good news is that people continue to want to buy. According to the National Association of Realtors, the number of contracts signed in May was 13% higher than a year ago with every region in the country reporting increases in sales.
But with rising demand and lack of suitable inventory, buyers are no longer in the driver’s seat.
What does that mean for buyers in the Sarasota area?
If you’re looking for a particular spot, it’s not as easy to find property, especially in the most popular neighborhoods. That’s definitely true for good houses priced under $250,000.
Until new construction catches up with demand, shopping for a home will be more like a hunt than the walk in the park it has been.
What should buyers do in the new seller’s market?
Pre-qualification vs. pre-approval. Don’t bother with the first, which is only an estimate on how much you can borrow. With sellers concerned about deals falling through, they want more certainty. Get pre-approved for a loan based on your credit, income and assets, and you’ll be in a better position to bargain.
Get with a veteran realtor who knows the market. In a competitive market, it’s crucial to have a pro on your side who’s experienced, knows the local scene inside and out, and is experienced in multiple-offer deals. That way you can be sure that a home is reasonably priced and advise you on what to offer.
Remember, if you get into the game, there are still very good buys to be had. With interest rates at historic lows, and prices considerably lower than during frenzy years, this is still a great time to get excellent value for your money. Just don’t expect bargain basement sales, and be prepared to move fast in the face of the competition.