Image source: Trendgraphix.

The Sarasota real estate market has slowed a bit since 2023, but luxury home sales above $1 million have continued to exceed the past six years. Compared to pre-pandemic sales in 2019, high-end home and condo sales in 2024 nearly tripled, with only 2021 coming close during the peak of the COVID buying frenzy.

Year-to-date, home and condo sales in the Sarasota Real Estate Market in all price categories are 5% behind last year. With new listings and home construction increasing, buyers have more leverage in negotiations. The gap between listing and sale prices is slowly widening, and price adjustments from sellers are becoming more common due to increased competition.

Days-on-market is an important factor to both buyers and sellers. A seller is anxious in today’s market as they recall the heady days in 2022 when number of days from listing-to-contract fell to just 17 days. Buyers see the extended listing periods as a sign that there might be something wrong with the property. The reality is somewhere in-between and more likely about buyers having more choices with higher inventory, and sellers not carefully considering pricing set by their competitor properties.

Using 2019 as a base (before COVID) compared to the last 12 months of activity, the numbers are quite remarkable. Inventory has fallen from highs of nearly 1,100 high-end properties for sale in the spring of this year, down to closer to 2019 levels. And the listing-to-contract period has become notably shorter. In 2019, it averaged 139 days; this year, it has been around 70 days. 

As many market economists expected, the Fed’s recent 25 basis point reduction did not measurably affect mortgage rates, thus had little effect on housing sales. Financial experts have reduced their projections for the number of rate cuts in 2025. Additionally, the Mortgage Bankers Association has published their forecast, anticipating mortgage rates to remain around 6.5% over the coming years.

Mortgage rates have now hovered over 6% for the last couple of years. Consumers are adjusting to the current market realities and are moving forward with their plans to buy or sell. Historical data reveals that the 50-year average is 7.7%.

Over the past three months, major storms significantly impacted Sarasota’s real estate market. Office closures, recovery efforts and water and power interruptions disrupted listings and sales. Combined with political tensions and high mortgage rates, it is unsurprising that the 4th quarter of 2024 wasn’t winding down the year on a high note.

As we approach the peak tourism months, I expect demand to remain strong. Inquiries from prospective buyers and sellers have grown over this last month leaving me encouraged for a healthy 1st quarter ahead. However, it is likely that the real estate market will continue to experience unexpected turns. Partnering with an agent who comprehends our nuanced local conditions is essential in navigating these shifts to make informed decisions based on your goals.

Image source: Trendgraphix.