Frenzied residential real estate market in dire need of supply

Sometime in April, when coronavirus angst was raging high, Premier Sotheby’s International Realty President and CEO Budge Huskey made a prophetic statement on a Zoom call with agents and brokers. “The greatest impact from Covid,” he told the team that day, “won’t be demand. It will be supply. Our greatest challenge will be inventory.”

'It’s crazy. I've never seen it like this before and I’ve been doing this for 42 years.' David Clapp, Re/Max Alliance 

Huskey was spot on. Going into the fall, inventory is well below normal levels in the Sarasota-Manatee market, at 2.4 months for single-family homes in Sarasota County and 2.3 months in Manatee County. An equilibrium in inventory is around 6 months supply, says Sarasota-based Re/Max Alliance Group Managing Broker David Clapp, which means agents are constantly playing catch up, on the hunt for listings. “It’s crazy,” Clapp says. “I’ve never seen it like this before and I’ve been doing this for 42 years.”

While inventory is low, tension is high. Clapp, also 2020 president of the Realtor Association of Sarasota-Manatee, says he’s heard of listings getting seven or eight offers a mere one or two days after hitting the market. And some bidders — circa 2004 and 2005 — are making offers that exceed the asking price. “There’s a lot of anxiety if your bid,” Clapp says, isn’t the winning one.

'We believe a good Realtor doesn’t just respond to demand. They also create demand.' Budge Huskey, Premier Sotheby’s International Realty

Overall, closed sales in the two-county market rose 24.1% in July over July 2019, with Manatee growing at slightly higher rate than Sarasota, according to monthly association stats. Also, pending sales, for the second consecutive month, increased in all markets in Sarasota and Manatee counties, with a combined 36.2% increase over July 2019.

Huskey and Clapp, similar to executives in other markets, attribute the sales surge to Florida staples, like weather and no state income tax, combined with the pandemic-led exodus from big cities. Another trend reaching into all markets along the west coast of Florida is the sight-unseen sale. Both Huskey and Clapp say that’s been happening at a rate they’ve rarely seen before.  

Of course, as more sales like that happen, it exacerbates the inventory conundrum. Huskey, with an approach centered on “your house may never be worth more than it is right now” says Premier Sotheby’s is tackling the inventory situation. “We’ve been getting aggressive on our campaigns, both print and digital, and letting people know to start to have the conversation about what your house is worth,” Huskey says. “We believe a good Realtor doesn’t just respond to demand. They also create demand.”