Demand driving up property values in Manatee County to highest level in almost a decade

A short supply of single-family homes across Manatee County continues to put pressure on the housing market and drive median prices closer to pre-Great Recession levels.

According to a report released Thursday by the Realtor Association of Sarasota and Manatee, the median sales price for an existing single-family home in July was $300,000, a 7.1 percent year-over-year increase.

That’s the first time the median price reached $300,000 since December 2007, when it was $305,000, RASM data shows.

“Median prices have been rising, but it is driven by supply and demand, not artificial factors as seen in 2005 and 2006,” RASM president Xena Vallone said. “The increase began in 2011 and has continued at a gradual, sustainable rate.”

Those surging values came at a cost, though, as sales across Manatee County fell 9.4 percent year-over-year last month. That dearth of homes on the market is part of a nationwide shortage of houses for sale, particularly in metro areas.

There was a 4.2-month supply of single-family homes for sale locally in July, meaning that’s about how long it would take to sell all of the properties if no others came up for sale. A 5.5-month supply is considered the ideal balance between buyers and sellers in the Manatee-Sarasota region.

Like in Manatee County, single-family home values also surged in Sarasota County, with median prices jumping 7.2 percent year-over-year to $260,000 in July.

Statewide, the median sales price for an existing single-family home last month was $240,000, up 7.1 percent from the previous year and marking the 68th consecutive month that it increased across Florida.

“Inventory remains tight and buyer demand is great,” said 2017 Florida Realtors president Maria Wells. “Homes continue to sell quickly.”

The numbers weren’t as encouraging locally in the condo-townhouse market, with year-over-year prices dropping 10.9 percent in Manatee County to $165,000 and rising 4.5 percent in Sarasota to $214,175. The statewide median price for condo-townhouse properties in July was $170,950, up 6.8 percent over the year-ago figure.

Nationwide, the July sales report released by the National Association of Realtors showed that sales of existing homes slipped 1.3 percent last month to a seasonally adjusted annual rate of 5.44 million. Despite the second straight monthly drop, sales are 2.1 percent higher than a year ago. But purchases are starting to slow as fewer properties are coming onto the market.

The real estate market is grappling with the consequences of a persistent shortage of homes for sale despite strong demand from would-be buyers. The decline in listings has driven up prices and made many homes unaffordable: Prices are rising faster than the wages of potential home buyers despite a solid job market.

The number of existing homes listed for sale across the country has plunged 9 percent during the past 12 months to 1.92 million properties. This steep drop in inventory has led to prices consistently climbing faster than wages.

The median sales price has risen 6.2 percent from a year ago to $258,300, more than double the pace of growth in average hourly earnings.

The lack of homes on the market is also causing properties to sell more quickly. The average number of days on the market was 30 in July, compared with 36 a year ago.

This story was originally published August 24, 2017 at 11:50 AM with the headline "Demand driving up property values in Manatee County to highest level in almost a decade."