Healthy November for home sales in Manatee County

Americans bought homes in November in the fastest pace in nearly a decade, with Manatee County homebuyers helping to lead the way.

The Realtor Association of Sarasota and Manatee said Wednesday that sales of existing homes rose 18.4 percent last month in Manatee County when compared to the same time last year.

Sarasota County had a 5.2 percent year-over-year improvement, giving the two-county area a solid 10.5 percent increase from a year earlier.

Even as inventory has increased during the past few months across Manatee and Sarasota counties, what economists still consider to be a tight supply of existing homes pushed median sales prices higher.

The median price in Manatee County was $279,000 in November, a 3.3 percent year-over-year increase. In Sarasota County it was $265,000, a more-than-healthy jump of 15.9 percent.

“As long as inventory remains at lower levels, median prices can be expected to increase,” said Linda Formella, the president of the Realtor Association of Sarasota and Manatee. “Buyers facing rising prices and interest rates may look to enter the market, putting more pressure on already-low inventory.”

Said Lawrence Yun, the National Association of Realtors’ chief economist: “We have a housing shortage. We are not building enough housing.”

That’s certainly the case locally. According to the RASM report, inventory of single-family homes in Manatee County was at a 4.2-month supply in November – a balanced market is a 6-month supply – and Sarasota County was at a 4.4-month supply.

“Since September, we’ve seen an upward trend in inventory, reversing the downward trend that started in March,” Formella said.

Condo median prices were down slightly in both counties from November 2015: Manatee decreasing 1.9 percent to $160,500, and Sarasota dipping 1.3 percent to $196,500.

With potential homeowners fearing higher interest rates, new pending sales had dramatic increases last month. There was a 25.1 percent uptick in Manatee County and a 24 percent surge in Sarasota.

“People who had locked in their rate” are following through with their purchases, Yun said.

Now, with the rate on the benchmark 30-year fixed mortgage rate at a 52-week high of 4.16 percent, and with interest rates climbing since the Nov. 8 election of Donald Trump as president, economists are predicting only a small gain in sales of existing homes next year – a 2 percent increase to about 5.52 million.

“Some prospective buyers are going to be straining to get to an affordable monthly payment with mortgage rates higher and may take a harder line on prices (or settle for less home) to make the numbers work,” said Stephen Stanley, the chief economist at Amherst Pierpont Securities.

Still, a healthy job market – unemployment is at a nine-year low 4.6 percent – has given more Americans the confidence to shop for homes.

NATIONAL HIGHLIGHTS

▪ Sales of existing homes rose 0.7 percent last month to a seasonally adjusted annual rate of 5.61 million. That was up from a downwardly revised 5.57 million in October and the highest since sales hit a 5.79 million pace in February 2007. Sales were up 15 percent from a year earlier.

▪ Sales rose 8 percent in the Northeast and 1.4 percent in the South, but fell in the West and Midwest.

▪ Fewer than 1.9 million homes were on the market, down 9 percent from a year earlier. The tight supply pushed the median price to $234,900 last month, up 6.8 percent from a year ago.

▪ Inventory of available properties dropped 9.3 percent from November 2015 to 1.85 million, marking the 18th consecutive year-over-year decline.

▪ First-time buyers accounted for 32 percent of all sales, compared with 33 percent in the prior month.

▪ Homes sold in 43 days, down from 54 days a year earlier.

▪ Forty-two percent of homes sold in November were on the market for less than a month.

This story was originally published December 21, 2016 at 2:32 PM with the headline "Healthy November for home sales in Manatee County."