Supply and Demand in August

Supply and Demand in August
August was a very promising month in the real estate market this year. The Sarasota market is seeing an increase in sales but a decline in inventory. What will this mean for our buyers and sellers? Statistically speaking this is all a matter of supply and demand.

The Good, the Bad, and the not so Ugly
This August is out performing last August by a whopping 27% and also last month by 15%.
Check out these numbers provided by Sarasota Association of Realtors.

This is the first time in a few years that we have had the pleasure of seeing this increase from July to August. Although it is unexpected, it is a reassuring month for the real estate market and creates excitement for the near months to come.

With this increase in sales we are seeing a lot of positive effects of activity lately. Activity such as multiple offers, more foot traffic for open houses, less homes going into foreclosure, more pending sales, and homes spending less time on the market.

Increased Sales and a Decrease in Inventory
I’m sure we can all agree that the increase in sales has everyone excited and is very welcome in our recovering economy, as these sales do have an effect on the available inventory. We are seeing higher turn-over rates, offers closer to the listing price, more competition for acquiring inventory, and more buyers making firm decisions.

Inventory Numbers Provided By The National Association of Realtors

*Months of inventory represents the time it would take to deplete the current inventory at the current sales rate.

The months of inventory remained near 10-year lows with the worst of our market pin pointed to the month of November 2008. With this lower inventory we are seeing the competition rise to obtain listings and bring our clients to make a quick and final decision.
With the decreasing options for buyers, they are making quick final decisions once they find a property that satisfies their lifestyle, financial, and leisurely needs as we are now seeing more buyers go under contract. We have seen a rise in pending properties from:

• 813 in August 2011
• 860 in June 2012
• 919 in July 2012
• 953 in August 2012

This is a 16% increase in sales in this year’s activity alone! This also means that we are currently in a seller’s market. With inventory at its lowest in a decade, sellers can be more selective with the associate that they deem most suitable for managing the sale of their property. The seller is also in a position to increase their sales price accordingly with the increasing market and more likely to obtain an offer closer to their listing price.

Putting It All Together

We are seeing an increase in activity within our Sarasota market. As a result of this, there is more effort put in to obtain a suitable inventory and to impress our prospective clients so we are able to do more business and keep up with the demand of today’s market. We are also seeing a decline in foreclosures and short sales due to the increasing market and the ability to obtain an offer at a faster pace. This is certainly great news!