One of the biggest understatements I’ve heard recently is that buyers are starting to feel a sense of urgency. If they’re just starting to feel a sense of urgency, where have they been for the last year? The urgency isn’t going to get any better.
With the recent rapid rise in interest rates, economists are forecasting a frenzied first half of the buying year and a somewhat calmer second half. I’m not sure that’s going to make buyers feel any better. U.S. home sales surged to a 15-year high in 2021 and with the leftover, pent-up desire for homes, 2022 could just be a redo of the previous year.
Although it’s true rates are going up, they are still very low compared to other times in history, as I pointed out last week. Some buyers will feel it, but many will just absorb the extra monthly carrying costs as part of the new reality.
In our neck of the woods, the 2021 Sarasota and Manatee housing market was a record-breaking year of sales. The Realtor Association of Sarasota and Manatee reported that December ended “in line with the upward trend that has been visible throughout the last quarter: higher prices, lower inventory and fewer sales than the same month in the previous year.” Most months during the year ended with increased median sales prices, including December, which broke the previous record set in November.
Although prices in the last month of 2021 broke previous records, the combined closed sales of all property types in both counties decreased by 14.3%. For single-family homes in Sarasota County, sales were down 19.4% and in Manatee County down by 8.1%. Condo sales were also down by 17.3% in Sarasota and down by 9.5% in Manatee.
In both counties, 100% of homes sold at or above the original list price. They also sold fast, with the median time from listing date to contract date reported at seven days for single-family homes and condos combined for the two counties. Also, comparing 2020 to 2021, the total number of closed sales increased by 14.9% for the combined counties.
Finally, cash sales were the way to go in 2021 for both counties, accounting for 57.3% of all single-family sales for the year. For all condo sales in the two counties, 40.2% were closed with cash.
Since the Sarasota/Manatee housing region is frequently looked at as one entity, it’s important to report what is going on in Sarasota, since it does influence Manatee, as well.
It’s undeniable that Sarasota and Manatee counties are two of the areas at the top of the real estate heap in Florida. All of the state is doing well, and the Tampa Bay region, as previously reported, is slated to be number one in the country in 2022, according to Zillow.
Unfortunately, buyers are still in the untenable position of having to make quick decisions about one of the biggest investments and purchases in their lives. And sellers are hesitant to sell because they fear having trouble finding a new home because of short supply and higher interest rates associated with a new mortgage.
Call it a sense of urgency or just call it what it really is – a new normal, at least for this year. But then we’ve had a lot of new normal recently, haven’t we?
