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Saturday, January 13 2007 @ 01:43 AM Central Standard Time
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Would you believe that for every 19 people in Sarasota, there is one planned condo for them?
Better believe it! Sarasota condo craze has become crazier than that of Miami. Let’s us look at the following proportions. In Miami, developers’ plan is to construct 25,000 units in the city centers. It means one condo for every 24 of its 600,000 population. Sarasota, on the other hand, has 55,000 residents so every 19 of them gets one condo.
Industry observers and players are quite doubtful whether Sarasota’s sizzling condo build up will overshadow its demand and cause the decline of condo prices. This likewise brings about the question about whether Southwest Florida is on the verge of real estate bubble.
In recent months, real estate agents are already encountering difficulties in selling a $1M Sarasota condo. Does this mean that Sarasota high-end condos exceed supply than demand?
Yes, this might be true except for condos priced from $400,000 to $800,000 which are selling like hotcakes. However, real estate agents are afraid sector will cool off once construction of nearly 1,000 units is finished.
There is no exact figure of the number of condos purchased by investors, but if there is a substantial figure of speculators who will later on decide a resale, this could mean a decline in condo prices.
Nevertheless, there is a positive consensus among the people in the industry that Sarasota condo market is well-off than in other areas across the region.
During the preconstruction period, condos have already been snapped up by investors, then when construction get underway, they start “flipping” the property. For instance, a 2-bedroom condo initially sells at $650,000. This is being resold for $760,000 when the occupancy certificate is yet to be issued.
Jack McCabe, real estate consultant, who is quite cynical about the condo market, has this to say about Saratosa. “Percentage wise, Saratosa may have more condos per capita than Southeast Florida, but the city has garnered tremendous positive publicity, resulting in one of the highest appreciation rates of any market in the country. There is no doubt a lot of flipping has been going on, but eventually the buildings will get filled.”
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Saratosa’s present boom started when Sarabande and Tessera were constructed way back in the late 90’s. But the city’s condo market real take off began upon the coming of the Ritz-Carlton, Tower Residences and Beau Ciel which inspired a wider range of buyers.
Developers are confident that Sarasota condo market will remain strong for years to come. They believe that if they do not act fact, there will a shortage of residences to accommodate the millions of people expected to mover to Florida over the next 10 years.
The director for Metrostudy’s Tampa Division, Tony Polito, said 20% of the city’s condos have been bought by speculators compared to that of Southeast Florida’s 75%. He believes the Sarasota market is well balanced, but that will be known until the big projects are completed and units flows back to the market.
Generally speaking, the condo craze in Saratosa and the migration of millions of people into the city will bring forth heightened market fever which will make Saratosa a more dynamic place to dwell in.
Ma. Roma C. Agsalud
http://www.siestakeyrealestate.com |
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