You may be thinking, “What goes up, must come down,” and the real estate market is no different. However, unlike the stock market you still have your property which continues to have great value. When Hurricane Charley impacted the area, property prices skyrocketed due to investor interest and limited supply. A few years later many homeowners looking to sell complained that prices dropped. What they didn’t consider was unless they bought at the high, most still enjoyed increases in the valuation of their property that outpaced returns they were getting in the stock market. Now we are seeing the same thing. Prices rose due to what we perceived as panic buying that occurred during the pandemic, but with those fears subsiding, and travel being restored to more normalcy, we are seeing that buying frenzy abating. It started the end of July 2022, and with higher interest and insurance rates in addition to inflation and banking concerns for some, valuations have been trending lower. Single family home prices in Sarasota County dropped 9.6% in the month of April compared to the year before, dropping to an average of $650,789.00, while condominiums in Sarasota County fell by 3.3% to $640,583.00. Charlotte County saw a more significant decrease in the price of single family homes over the same time period falling 18.4% to $417,914.00 from a high of $511,939.00. Condominiums saw a 16.4% decrease from the previous year to $325,303.00. The boating communities of Punta Gorda Isles and Burnt Store Isles also saw single family homes selling for 20% less this April compared to April 2022, as the average selling price dropped from $1,043,625.00 to $835,166.00. Condominiums experienced a 13.25% drop as the average selling price adjusted from $422,510.00 to $383,854.00.
While the numbers may have adjusted, take heart. Most would agree the valuations of their homes are still significantly higher now than they were prior to the pandemic. For those who bought at the high during the pandemic, I would venture to say you are enjoying your lives here in Florida. For those looking to sell at this time, keep in mind the market isn’t the same as it was during the pandemic. Inventory is a bit higher and buyers are being more patient and looking for prices that aren’t as inflated. The good thing to consider is with the lower prices buyers are going to start reentering the market, but they are factoring in higher interest rates if they are financing, along with high costs association with insurance. With remodeling costs remaining high, these are the factors buyers are keeping in mind when purchasing a home. Homes are selling if they are being perceived to be competitively prices to others on the market when factoring in the cost to remodel along with the price to purchase the property.