Hot market becoming not so hot? | South Salem Real Estate

The number of buyers who signed contracts to acquire homes in Southwest Florida flattened out in February from the previous month, a signal that real estate sales may slow in the months ahead.

Real estate agents reported 1,532 new pending sales in Sarasota, Manatee and Charlotte counties during February. That was up a scant 0.3 percent from January, but perhaps more significantly, down nearly 3 percent from a year earlier.

 

That tracked the national trend, however. The number of Americans who signed to buy new homes fell in February for the eighth straight month.

 

Pending sales are considered a reliable measuring stick for future home purchases. There is typically a one- to two-month lag between a signed contract and a closed sale.

 

Experts say higher mortgage rates, rising prices and a limited stock of homes have slowed sales in recent months. A brutal winter also has been blamed for slower sales in the Northeast, which could impact sales in the Sunshine State if those potential buyers can't unload their homes first.

Throughout Florida, pending sales were down by nearly 1 percent in February from January, and by 5.5 percent over the year.

 

The National Association of Realtors' Pending Home Sales Index dipped in February to its lowest reading since October 2011.

 

But Lawrence Yun, the group's chief economist, said the recent slowdown in home sales may be ending even as home prices continue to rise.

 

 

 

 

 

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"Contract signings for the past three months have been little changed, implying the market appears to be stabilizing," Yun said. "Moreover, buyer traffic information from our monthly Realtor survey shows a modest turnaround, and some weather delayed transactions should close in the spring."

Local numbers on pending sales were mixed.

In Sarasota County, pending sales were up 6.4 percent in February for the month and 2 percent over the year.

But in Manatee County, pending sales were down by 2.3 percent from January and by nearly 17 percent over the year.

Charlotte County posted a 6.6 percent decline in pending sales for the month but an 11 percent increase for the year.

The higher pending numbers in Sarasota bode well for sales in Sarasota the next three months, said Peter Crowley, president of the Sarasota Association of Realtors.

February sales dipped 2.4 percent in the county from last year but were up a similar percentage from January.

Inventory levels topped 5,000 for the first time in nearly three years, he noted, and were 34 percent higher than the low point last July.

"If you had to describe the market with one word, it would certainly be steady," Crowley said. "Volatility in real estate isn't historically a healthy climate, so we don't really mind the current state of the market."

Statewide, sales of existing single-family homes rose just 1.5 percent over the year. Condo and townhouse sales were off by 6.8 percent.

"The majority of results for the residential market paint a picture of a normal, growing market," said John Tuccillo, chief economist at Florida Realtors. "The weaker results in sales for both single-family homes and townhouses and condos are solely the result of plummeting short sales.

"This is actually a good sign, since short sales are falling because prices are rising, reducing the number of homes that fall into the potential short sales category," he said.

Nationwide, existing-home sales are projected at 5 million in 2014, which would be just under last year's 5.1 million. Housing starts are forecast to increase 19 percent and reach about 1.1 million, closer to the underlying demand of 1.5 million, the NAR noted.

The gain in new home construction will reduce some of the pressure on home prices, with the national median existing-home price expected to rise in the range of 5.5 to 6 percent this year, compared with an 11.5 percent jump in 2013, the NAR said.