Island real estate in transition
Real estate buyers who think Anna Maria Island is like the mainland and in a buyers market with a glut of homes for sale should think again. Island real estate agents agree the Island real estate market bears little resemblance to its mainland counterpart.
While many Manatee area real estate agents claim they are in a buyers market with an overload of homes for sale, local agents say the Island market is in transition. Just where its headed and when it will get there, however, won't be determined until later in the season.
"We are absolutely a different market than the mainland," said Alan Galletto of Island Real Estate in Holmes Beach. Unlike the mainland, with it's vast tracts of landlocked homes, "We're like an enclosed waterfront market and waterfront properties are always in demand."
He noted that while the inventory of homes for sale in east Manatee County is up 300 percent from last year, the Island's inventory only climbed 50 percent during the same period.
And, he added, sales of Island real estate are always slow at this time of year. He and other real estate agents won't have a better "handle" on which way the market is headed until later in the season.
"Historically, sales pick up around December, then peak between March and May. We'll know then if it's a buyer's market or seller's market," he said.
"But Island real estate values aren't' going down. What we may see is a slowing of the rate of appreciation. We've been getting a 30-35 percent annual increase in value," he observed. That rate of increase isn't likely to continue, but Galletto predicted a steady 15 percent annual rise in property values.
"And that's still a good rate of return," he added. "So, we're not a seller's market or a buyer's market yet. The next few months will tell us."
Barry Gould of Island Vacation Properties agreed the market is changing.
"The market is definitely in transition," he said, but it's more of "getting to a level playing field. We don't know where the transition will end."
Buyers and sellers shouldn't take what's happening on the mainland as an indication of where Island real estate is headed. Anna Maria Island, as residents are keen to say, doesn't like to follow the trend of the mainland.
Remember, Gould added. "There is only so much space on the Island," while subdivisions and new houses are springing up almost weekly in east Manatee County.
But while some Island real estate buyers might be waiting, early December is not the best time to determine the Island market. It's the traditionally slow time for sales.
"Sales will pick up proportionately as the season progresses, so let's wait and see if sale prices go lower," Gould said.
There is, however, still a demand for Island real estate. Properties are being bought, sold or placed on pending every day, even in December.
Gould agreed that sellers who have been willing to negotiate a sales price have been doing better than others.
"I think the buyers who come during the holidays and meet the seller who will negotiate will do very well. There are always some excellent values in the Island market."
At Mike Norman Real Estate, Mike Norman also agreed the market is "in transition," but stood with his colleagues, saying it's too early in the season to predict where the transition will lead. Wait until mid-March or mid-April.
Some sellers may be waiting until later in the season to negotiate, he indicated, but right now, a smart seller will listen to a reasonable offer and adjust accordingly to effect a sale, and a smart buyer will start looking now, rather than waiting until later in the season.
If the traditional demand for real estate picks up at the end of the season, buyers now will be getting a bargain.
However, added Norman, "It's fair to say prices are leveling off."
And Island properties are still selling, just not quite as fast as last year. There were 11 sales in November 2005 compared with 15 for the same month in 2004.
So, what does it all mean for the Island real estate buyer?
Start looking now before the seasonal rush, said Norman, and find a seller who will negotiate.
Both Norman, Galletto and Gould agreed: Island real estate values aren't going down. Prices, however, appear to be in a state of "transition."