Perry was featured in the December 23rd edition of the Sarasota Herald Tribune.

By Michael Braga

Condominiums, like homes, are selling at a healthy pace in Southwest Florida, but the median sales price continues to give ground — the result of more realistic sellers and a greater mix of units at the low end of the market and distressed properties.

Sales during November rose 7 percent in Sarasota-Bradenton and 19 percent in Charlotte County-North Port.

Meanwhile prices fell 16 percent to $110,000 in Sarasota-Bradenton from a year ago and 7.6 percent from just the previous month.

Charlotte County-North Port’s median of $65,000 was a 13 percent drop from a year ago and a 7 percent decline from October.

“The price decline has everything to do with mix,” said Scott Norris, a condo specialist with Coldwell Banker. “There were probably more distressed sales in November or sales in places where prices are low.”

Inventory is so low now that prices should not be falling that much, Norris said.

“In all of downtown Sarasota and Lido Key, there are only 260 units for sale,” Norris said.

“That’s 40 percent fewer than were on the market in December 2005, a lower level than before all the new construction. Once you chop it all up into different price ranges, there really isn’t much to pick from.”

Norris sold six condos in the last two months and five went to seasonal buyers looking for units in the $150,000 range. The other sold for $400,000.

Two of his sales were 2,300-square-foot, lakefront units at Wildewood Springs in Bradenton that went for $125,000 and $145,000.

“At the top, they would have been pushing $400,000,” he said.

Perry Corneau, a condo specialist with Signature Sotheby’s, said most of his sales have been to investors who have been paying cash. “They’re looking at cash flows and don’t care what they look like,” Corneau said.

Some of those investors have been able to get some tremendous deals.

“There’s a one-bedroom Unit in the Village at Town Park in Lakewood Ranch that’s listed at $45,000,” Corneau said. “The maintenance fees are $256. You can rent that and make a profit.”

But unlike in the lower end of the single-family home market, Corneau said, buyers do not feel a sense of urgency yet.

“There’s a lot of people in a holding pattern,” he said. “A lot of boomers don’t have the income.”

Norris, who writes a comprehensive blog about the regional condo market on his website, pointed out that 30 condos sold in downtown Sarasota and Lido Key — the 34236 ZIP code — in November. That is three more than the previous November.

He also noted that sales of properties below $300k and above $1 million are both up double digits in the past 12 months compared with the prior 12-month period. But the opposite is true for everything in between.

“December is historically a weak month for real estate sales,” Norris wrote in his blog.

“But even so, there are 40 percent fewer Sarasota condominium residences on the market now than in December 2005.

“As inventory falls, the likelihood of finding that perfect home falls,” he wrote.

“In a more typical market, this might push prices higher. However, ours is a market of second-home buyers (especially condominiums) and second-home purchases are 100 percent discretionary.

“If the perfect home isn’t available at a great price, there may be no urgency to buy.”

Statewide, 5,590 condominiums changed hands during November, up 2 percent from a year ago but at a nearly 9 percent slower place than in October.

The statewide median sales price of $86,700 was a 4 percent increase from a year ago but down about 1.3 percent from October.

“The people buying are the same people who wanted to buy in 2006 when the market turned down,” said Perry Corneau, a condo specialist with Signature Sotheby’s International Realty. “They’ve just been waiting for the right time.”

Corneau and other agents said they have seen a lot of Canadians this year who are taking advantage of relatively strong exchange rates.  ”Everybody is paying cash,” Corneau said.

Across Florida, condo sales also were up considerably when compared with both February and a year ago, and prices experienced the same firming trend.  A total of 9,703 units changed hands, 39 percent more than February and 24 percent more than in March 2010.  The statewide median price climbed 9 percent to $84,300 from February, but was down 11 percent from a year ago.

“Overall inventory is dropping,” said Scott Norris, a Coldwell Banker agents who keeps running inventory totals on his website, scottnorris.com.  ”When inventory drops, the least desirable units get left on the market — the ones that don’t have the great views and are not in great shape. Properties that are nice go quickly, especially if they are priced right,” Norris said.

His inventory charts show that the number of unsold condos in Sarasota County have declined from a high of nearly 3,500 in March 2007 to under 2,000 last month. In Manatee County, inventories have dropped from a high of about 2,800 in March 2007 to less than 1,200 today.

But nowhere in the region has experienced a more dramatic drop than Lakewood Ranch, where unsold condos have dwindled from a high of more than 400 in December 2006 to just 50 in March.  Norris and other agents say those numbers could rise again when banks start refining foreclosures, but for the moment market conditions are improving.  ”As long as inventories stay down, the market has to improve,” Norris said. “It just takes time.”

Nationwide, condo sales increased 1.6 percent to a seasonally adjusted annual rate of 650,000 in March from 640,000 in February, but are 4.1 percent below the 678,000-unit pace of a year ago. The median condo price was $153,100 in March, which is 10.1 percent below March 2010.

In Sarasota-Bradenton, the median was $125,900 last month, down just $200 from February. The median in Charlotte County-North Port was up 9 percent to $74,200 from February.  ”Price is what drove sales,” said Marc Rasmussen, an agent with Michael Saunders & Co. in Sarasota. “Buyers are finding good properties that are priced correctly in almost all segments.”

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Condominium sales in Southwest Florida showed a collective 30 percent increase in February, compared with a year ago.

Sales rose 26 percent in the Sarasota-Bradenton market — to 325 units — while rising 53 percent in the Charlotte County-North Port market, to 66 units.

Perry Corneau, a condo specialist with Sarasota-based Signature Sotheby’s, said he is starting to see more buyer activity and bidding wars in the condo arena.

“I think buyers are realizing the days of having a ton of properties out there and being able to offer whatever you want are over,” Corneau said. “I’m working with a buyer right now who just got a real wake-up call.”

Corneau said his client thought he could offer $80,000 for a condo at the Park Ridge complex in University Park that was listed at $119,000. But Corneau convinced him to bid $116,100 and he still lost to someone who made a higher offer.

“Consumer confidence is up at a time when prices are looking quite affordable and interest rates are still low,” Corneau said.

On a year-over-year basis, median condo prices were down 11 percent to $126,100 in the Sarasota-Bradenton market during February, but prices rose 5 percent from January. In the Charlotte County-North Port market, prices dropped 28 percent to $68,000. The median price was down 4.8 percent from $71,300 in January.

Statewide, there was a similarly large increase in sales — up 29 percent to 13,668 — and a drop in price from a year ago — 14 percent to $77,300. That compared with $79,400 in January, for a month-over-month decline of 2.6 percent.

Every major metropolitan area in Florida posted an increase in sales during February except Panama City, which was flat at 54 homes changing hands.

Of the communities with a fairly large number of transactions, the highest increase was in Melbourne-Titusville-Palm Bay, which posted a 70 percent increase with 155 sales. Jacksonville posted a 67 percent increase to 234. Miami saw a 58 percent rise to 859 units; Tampa-St. Petersburg, a 33 percent increase to 947; Fort Lauderdale, a 19 percent increase to 1,357; and Orlando an 11 percent increase to 681.

Fourteen markets posted a drop in prices, while five saw some appreciation in the median sales price.

The biggest drop was in Melbourne, which along with its boom in sales saw a 41 percent drop in the median year-over-year to $73,200.

Tampa-St. Petersburg saw a 27 percent drop to $65,100; Jacksonville saw a 22 percent drop to $69,500; Gainesville dropped 23 percent from a small number of transactions to $50,000.

CONDOMINIUM FORECLOSURES are still much more rare than foreclosures on single-family homes, but the gap closed in 2010.

Foreclosures on condos soared 85 percent for the year, with lenders taking back 397 condominiums, compared with 224 in 2009.

The action appeared to be largely inland. The lowest foreclosure rates on condos was seen on Siesta Key, where 20 out of 6,781 condos completed foreclosure, and Longboat Key, where only 10 out of 1,119 went under.

By far, the highest foreclosure rate in the county was the 12 percent suffered last year along a commercial and condo strip on Osprey Avenue both north and south of the intersection with Siesta Drive.

Of the 150 condos in the neighborhood, 18 went through foreclosure. But the high foreclosure rate was driven largely by the 14 foreclosures at Bermuda on Osprey.

Over a two-year period ending in September 2008, California real estate investor John Couch bought 30 condos at Bermuda on Osprey for $300,000 per unit and quickly resold them to members of an investment group for an average price of $540,000 per unit. The investors defaulted on their loans en masse at the end of 2008.

Between sales at much lower prices and reassessments, the average value of a condo there is now estimated at about $53,000.

Other concentrations include 17 foreclosures in the Parkridge condos south of University Parkway and east of Tuttle; 13 in Las Palmas of Sarasota, south of University and east of Honore Avenue; 13 in Admirals Walk, north of Clark Road and west of Gantt Road; and 11 in Vintage Grand, near Sarasota Square Mall.

“When you go through those areas, people are saying, ‘I’ve heard there’s this many foreclosures,’ ” said Perry Corneau, a condo specialist who recently merged his company with Signature Sotheby’s.

“If you look at every area with a high foreclosure rate, you can trace it to one crummy project,” he said, noting that many of the projects the Herald-Tribune’s analysis identified as the hardest hit, including Admirals Walk and Bermuda on Osprey, were condo conversions done near the top of the market.

While condo foreclosures are happening at a brisk pace in some inland areas, it is not surprising they are rare on the barrier islands, Corneau said.

Banks would provide 100 percent financing for single-family homes but required sizeable down payments on condos. Most well-located condos on the islands can cover their costs through rentals, he said.

Better than one out of 20 single-family homes in Sarasota County had been through foreclosure between 2007 and 2010, nearly triple the rate of condos.

But in 2010, the foreclosure rate for condos jumped to 0.8 percent, nearly half the single-family home rate.

Nearly $50 million worth of condos, as measured by the county property appraiser’s annual assessments, went through foreclosure during the year. The average for these 397 foreclosed properties was $123,410. By and large, it is the lower-priced condos being reclaimed by lenders. Countywide, the average estimated market value for a condo is $225,646. So condos that went through foreclosure in 2010 were worth about 55 percent as much as the average condo in the county.

That mirrors what is going on in the broader residential market, where single-family homes that went through foreclosure were assessed at about 39 percent below the countywide average.
This story appeared in print on page D10