1 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
SARASOTA/BRADENTON
2Q2019 Executive Summary
Prepared by:
David Cobb
Regional Director South Florida/Sarasota/Jacksonville (239) 220-7023 [email protected]
2 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
Figure 1: Florida’s Unemployment Rate
0.0
2.0
4.0
6.0
8.0
10.0
12.0
Figure 2: Sarasota/Bradenton Change in Non-Agricultural Job Growth
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Jun
-13
Jun
-14
Jun
-15
Jun
-16
Jun
-17
Jun
-18
Jun
-19
Source: Department of Labor
ECONOMIC OVERVIEW
Metrostudy’s Sarasota/Bradenton market data cover all of the new housing activity in Manatee, Sarasota, and
Charlotte counties. Included in these data are single family detached and single family attached homes
(townhomes and duplexes).
Florida’s seasonally adjusted annual job growth rate as of June, 2019 was 218,800, an increase of 2.5%.
Nationally, the number of jobs increased by 1.5% over the year. The seasonally adjusted state unemployment
rate in June was 3.4%, unchanged from May and down 0.2% from one year ago. There were 349,000 jobless
Floridians out of a labor force of 10,338,000.
3 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
ECONOMIC OVERVIEW
The non-agricultural, non-seasonally adjusted annual job growth rate for the North Port – Sarasota- Bradenton
MSA added 3,700 jobs over the past twelve months (June 2018-June 2019), an annual growth rate of 1.2%. Refer
to Figures 2 and 3. The statewide average was 2.6%. The Construction (+1,500), Education/Health (+1,300), and
Trade, Transportation & Utilities (+2,300) sectors all showed notable job growth. The Punta Gorda MSA, which
includes all of Charlotte County, saw job growth of 1,100 during the same period.
Both MSAs saw the non-seasonally adjusted unemployment rate fall from the same month of the previous year.
See Figure 4.
Figure 3: Sarasota/Bradenton Distribution of Job Growth
Constr. Manuf. TTU Info. Fin.Prof. &Bus.
Edu. &Hlth.
Leisure &Hos
Other Svc. Govt
Jun-19 1,500 600 2,300 (100) (200) (1,600) 1,300 200 300 (600)
Jun-18 2,100 100 2,000 100 (300) 1,000 1,300 300 900 400
(2,000)
(1,500)
(1,000)
(500)
0
500
1,000
1,500
2,000
2,500
Source: Department of Labor
Figure 4: Sarasota/Bradenton MSA Unemployment Rate
MSA Jun-19 Jun-18
Northport-Sarasota-Bradenton 3.4 3.7
Punta Gorda 4.0 4.3
4 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
Figure 5: Sarasota/Bradenton Annual Starts & Closings of New Single Family Housing
HOUSING MARKET OVERVIEW
The quarterly starts rate for Sarasota/Bradenton (including Charlotte County) increased 28% to 1,706 from
the previous quarter, but were flat (0%) when compared to the second quarter of 2018. The annual starts
pace remained flat over the previous quarter at 6,141, but increased 5% from the second quarter of 2018. Our
second quarter 2019 survey observed finished vacant inventory at only 1.1 months of supply (MOS),
unchanged from the previous quarter.
The current annual starts pace has been the same for the past three quarters, and this level of activity is the
highest since the fourth quarter of 2006. The current starts pace is 130% of the 18 year average, but only
67% of the peak (9,121), which occurred in the third quarter of 2005. Refer to Figure 5.
A start is defined by Metrostudy as a poured slab. A closing is defined when physical possession of the home
is observed. Inventory consists of homes under construction, models, and finished, vacant homes.
Starts Closings Inventory
3Q18 1734 1371 3644
4Q18 1365 1615 3394
1Q19 1336 1370 3360
2Q19 1706 1701 3365
Annual 6141 6057 N/A
5 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
Figure 6: Sarasota/Bradenton Starts by County
2,769
2,474
898
0 500 1,000 1,500 2,000 2,500 3,000 3,500
Manatee
Sarasota
Charlotte
HOUSING MARKET OVERVIEW
Second quarter 2019 closings increased 24% from the previous quarter to 1,701, and increased 2% from the
second quarter of 2018. The annual closing pace of 6,057 was flat from the previous quarter, but increased
11% from the second quarter of 2018. Charlotte’s finished, vacant home (F/V) rate held at 0.5 months of
supply (MOS), Manatee’s F/V decreased slightly to 1.1 MOS, while Sarasota’s F/V remained unchanged at
1.2 MOS, unchanged from the previous quarter. All of these values illustrate the fact that the market has few
finished, vacant homes in inventory. Refer to Figure 10 for the finished, vacant inventory trend.
The finished-vacant MOS metric is the number of finished-vacant homes divided by the number of move-ins
over the last four quarters, then multiplied by twelve. Metrostudy has observed over the years that when this
number rises above 3.0 MOS and stays there, builders tend to reduce prices or make concessions, so
Metrostudy monitors this metric closely.
Vacant, developed lot (VDL) inventory increased 1% from the previous quarter to 38,986 lots and increased
4% year over year (y-o-y). Lot deliveries for the second quarter decreased 13% to 2,292 when compared to
the previous quarter. Future lots totaled 118,608, which is down 2% from the previous quarter, and down 7%
y-o-y. Refer to figures 11 and 12 for the VDL and futures trend.
6 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
PRICE RANGE DISTRIBUTION & TOP 10 COMMUNITY LIST
As can be seen with the accompanying chart, year over year gains in the annual starts pace occurred in the price
ranges between $200,000 and $600,000. Starts for homes priced over $600K are either flat y-o-y or show a
decrease. Demand for affordable homes (those under $400,000) remains robust, while demand for expensive
homes is somewhat soft.
The Top 10 single family communities in the Sarasota/Bradenton market, ranked by the past 12 month’s starts
through the second quarter of 2019 is shown in the following chart. Large, master-planned communities top the
list, with Lakewood Ranch at number 1 both in this market and also nationally.
Ranking Community LocationAnnual
Starts
Annual
ClosingsBuilder
1 Lakewood Ranch Manatee 1169 1103 Multi builder
2 The West Villages Sarasota 772 799 Multi builder
3 Palmer Ranch Sarasota 308 313 Multi builder
4 Babcock Ranch Charlotte 295 234 Multi builder
5 South Gulf Cove Charlotte 176 175 Multi builder
6 Silverstone Manatee 171 149 DR Horton
7 Artisan Lakes Manatee 156 95 Multi builder
8 Grand Palm Sarasota 147 173 Neal Communities
9 Trevesta Manatee 117 112 Multi builder
10 Silverleaf Manatee 116 119 Neal Communities
Figure 7: Sarasota/Bradenton Price Range Distribution
<$200 $200-$299 $300-$399 $400-$499 $500-$599 $600-$749 $750-$999 $1M+
2Q17 173 2,300 1,825 802 186 114 81 117
2Q18 149 2,372 1,795 984 216 141 50 115
2Q19 148 2,474 1,859 1,102 296 130 52 79
0
500
1,000
1,500
2,000
2,500
3,000
7 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
MANATEE COUNTY
Manatee County is located within the Northport-Sarasota-Bradenton MSA. Active master-planned subdivisions
in are included in our research, but scattered lot activity is not.
Starts Closings Inventory
3Q18 804 700 1624
4Q18 625 723 1526
1Q19 607 664 1469
2Q19 733 793 1409
Annual 2769 2880 N/A
Quarterly starts increased 21% to 733, and quarterly closings increased 19% to 793 from the previous quarter.
Quarterly starts were down 6% y-o-y, and quarterly closings were down 4% y-o-y. The annual starts rate
decreased 4% y-o-y to 2,769, while the annual closings rate increased 3% to 2,880 y-o-y.
Housing Inventory in Manatee County remains below equilibrium at 5.9 MOS, and is down from 6.1 MOS
observed in the previous quarter. Nine months of supply is considered normal. The supply of VDL inventory
fell 2% from the previous quarter to 5,317, a 23 months’ supply. This MOS has remained constant since 2016.
The previous twelve months’ lot deliveries totaled 2,787, in line with the annual starts pace of 2,769. Future lot
inventory decreased 1% from the previous quarter, and decreased 2% year over year to 64,634, a 280 months’
supply.
Figure 8: Sarasota/Bradenton Housing Inventory by Submarket
0
2
4
6
8
10
12
14
0
100
200
300
400
500
600
700
800
MonthsUnits
Fin Vacant Under Const Housing Mos
8 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
Sarasota County is located within the Northport-Sarasota-Bradenton MSA. Active master-planned subdivisions
in Sarasota County are included in this research, but the scattered lot activity, such as found in North Port, is
not.
Starts Closings Inventory
3Q18 685 543 1404
4Q18 579 736 1247
1Q19 551 507 1291
2Q19 659 614 1336
Annual 2474 2400 N/A
Quarterly starts increased 20% to 659, and quarterly closings increased 21% to 614 from the previous quarter.
Quarterly starts increased 9% y-o-y, while quarterly closings increased 6% y-o-y. The annual starts rate increased
6% to 2,474, while the annual closings rate increased 15% to 2,400 from the second quarter of 2018.
Housing Inventory increased slightly quarter-over-quarter (q-o-q) to 6.7 MOS from 6.6 MOS, but remains below
equilibrium which is a nine months’ supply. VDL inventory increased 5% q-o-q to 5,654, a 27 months’ supply. Lot
deliveries for the previous twelve months totaled 3,393, well above the annual starts pace of 2,474. Future lot
inventory decreased 3% from the previous quarter, and decreased 23% year over year to 24,288, a 118 months’
supply.
Figure 9: Sarasota/Bradenton Annual Starts by Submarket
1,001
1,694
74
306
420
119
417
1,212
473
120
305
0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000
Manatee North
Manatee Southeast
Manatee Southwest
Englewood
North Sarasota
Osprey
South Sarasota
Venice
Charlotte East
Charlotte North
Charlotte West
SARASOTA COUNTY
9 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
CHARLOTTE COUNTY
Charlotte County is comprised of the Punta Gorda MSA. Active master-planned subdivisions in Charlotte County
are included in this research as is the scattered lot activity in Rotunda and South Gulf Cove.
Quarterly starts increased 76% to 314, while quarterly closings increased 48% to 294 from the previous quarter.
Quarterly starts increased 28% y-o-y, while quarterly closings decreased 10% y-o-y. The annual starts rate
decreased 1% to 898, while the annual closings rate increased 10% to 777 from the second quarter of 2018.
The large increase in the percentage of starts can be attributed to the activity in Babcock Ranch. Housing
inventory remained flat from the previous quarter at 9.6 MOS, slightly above equilibrium. VDL inventory
increased 2% to 27,979 from the previous quarter, and is up 3% y-o-y, which is a 374 months’ supply. The large
number of VDLs in Charlotte County is due in part to the vast scattered lot inventory that can be found in Burnt
Store, Rotunda, and South Gulf Cove. Annual lot deliveries totaled 1,630, well above the annual starts pace of
898. Future lot inventory decreased 4% q-o-q to 17,348, a 232 months’ supply.
Figure 10: Sarasota/Bradenton Finished, Vacant & MOS Trend
Starts Closings Inventory
3Q18 245 128 615
4Q18 161 156 620
1Q19 178 199 599
2Q19 314 294 619
Annual 898 777 N/A
0.0
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0.4
0.6
0.8
1.0
1.2
1.4
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600
2Q
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Finished Vacant F/V MOS
10 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
Figure 11: Sarasota/Bradenton Vacant, Developed Lot Inventory & MOS
Trend
Figure 12: Sarasota/Bradenton Future Lots Trend
CONCLUSION The Sarasota/Bradenton housing market is a model of stability, with no significant gains or losses in the housing
metrics that Metrostudy tracks. The current economic cycle is at or near peak, and home prices are back to historic
highs, so these two trends will shape the housing market in the future. The good news is that supply remains
constrained, both with new and resale inventory, so we won’t see the oversupply scenario that occurred during the
last recession. Short term worries include the health of the economy and the risk of inflation, but the long-term concern
is the crushing amount of national debt that shows no sign of abating.
11 SARASOTA/BRADENTON | 2Q19 EXECUTIVE SUMMARY
METROSTUDY
Metrostudy is the leading provider of primary and secondary market information to the housing and related
industries nationwide. In addition to providing information, the company is recognized for its consulting
expertise on development, marketing and economic issues, and is a key source of research studies
evaluating the feasibility of residential and commercial real estate projects. Services are offered through an
extensive network of offices strategically located in major metropolitan areas throughout the country.
OU
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SOUTH FLORIDA REGIONAL OFFICE
8895 N. Military Trail Suite 203-B Palm Beach Gardens, FL 33410
Phone: (561) 228-8001
Gail Ryan Field Research Manager
813.249.9425
Gregg Lowenstein Director of Business Development
202.394.6883
David Cobb Regional Director
239.220.7023
