According to Inman.Com, nationwide real estate supply was down 1.4 percent last year. According to traditional supply and demand, any time supply is low, selling price tends to increase. In the real estate industry this leads to fewer homes being sold, but the homes are sold at a higher price, or what’s known as a seller’s market.
According to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development (HUD), new residential home sales dropped 8.9 percent in October, which is the lowest it’s been in two years.
So what does this mean, and how does it affect the market for 2019?
We believe 2019 will be a year for growth in the industry, and it’s based on the following:
1. Existing Home Sales
Existing home sales climbed 1.4 percent in October from September.
If you’ve talked with contractors in Sarasota, it won’t take long for them to tell you how busy they are and how difficult it is for them to find help. The unemployment rate is the lowest its been in 20-years, which means, everyone is currently working and job openings cannot be filled. Even with all the new construction in Sarasota, most homes for sale are existing homes.
2. Housing Units Authorized
This is a very positive indicator as the limited inventory in the U.S. has led to inflated housing prices. Nationwide, there are nearly 170,000 residential units ready to be built, which is the highest level reached in a decade. Since 2015, the city of Sarasota alone has approved plans for 1,700 apartments and 1,400 condominiums, all of which are still in progress. Once these homes and condos hit the market, there will be a needed growth of inventory, which should also spur sales.
3. Increase in Disposable Personal Income
While disposable personal income is not typically an indicator in the real estate industry, a higher disposable income means a rise in wages, which IS a positive indicator in the industry. According to the Demographics in Sarasota, there has been a 16% increase in household income since 2000 and an 11% increase since 2010.
Whether you’re looking to sell or buy, we can help. Contact us directly at BrandyCoffey941@Gmail.Com or 941.404.4737.