Sarasota, FL (PRWEB) March 7, 2006
In order to correctly understand the Sarasota real estate market one has to look past most of the “numbers” - numbers like how many listings - how many sales – how many days on the market – and analyze the facts. It would be very easy to look at the number of listings, which is about 4 xs as many as a year ago & how long it takes a property to sell today – about 90 -120 days vs. “immediately” in some cases a year ago- and conclude real estate is slumping in Sarasota.
The real picture of the Sarasota real estate market is not that it is ‘over-priced. Rather it is “over-listed”. In other words, the asking prices in many instances are not realistic. In fact, they are obviously incorrect. This results in an abundance of un-sold homes, which the market will never absorb.
These properties will have to reduce the asking price before the home will sell. In the Sarasota MLS system, approximately 200 units reduce their price each week because they were incorrectly priced in the beginning – not because any real estate bubble is “bursting”.
The proof is in the number of days a property sits on the market with no showings and no offers. There are a number of reasons for this phenomenon. A seller today has to look at his property in terms of the value as of 2004 & 2005. If you purchased 12 months ago, the value is probably about 8 % higher depending on certain variables. After doc stamps and commissions, a seller of such a property is going to break even - still not bad.
In 2005, values did not peak. Rather, the rate of appreciation has backed-off. Many sellers today are not accepting of this reality.
Over the past months, we have developed an asking-price evaluation formula, called the Relative Value Index (RVI) TM – which analyzes the asking price of a particular property in today’s market. This proprietary mathematical equation has been extensively tested and is free to our clients.
Our Sarasota buyers are able to evaluate the asking price of any listing. The bottom line for our clients is feeling confident they are not over-paying for a property. By applying the RVI, they can feel confident they are getting a “fair deal”.