Sarasota Real Estate - What Incentives Are In Store For Home Developers And Buyers

Sarasota is a mid-sized Southwestern Florida city that is famous for its pristine white-sand beaches and resorts, shopping and cultural destinations, retirement and family housing options, and comfortable standards of living. The city's housing market is also viewed as a preferred option for those who wish to invest in vacation homes, retirement residences and in condominiums and other properties.

The factors fueling the housing market in Sarasota are,in one level, a simple equation of supply and demand. But beneath the usual statistics are the strong economic drivers of low interest-rate mortgages, poor market performance for traditional investments, retiring baby boomers, absence of state income taxes, limited property taxes and the natural allure of Sarasota. For new residents moving into the community, this means that purchasing a home in Sarasota is a much better investment than elsewhere.

The City, And The County As well, Is Starting To Offer Incentives For Home Buyers

Faced with a skyrocketing housing market that is driving many working families from owning a home, Sarasota and the nearby counties have begun offering developers various incentives to build affordable homes. The incentive program recently unveiled by the County Commission signals the biggest push for affordable housing ever agreed to by the board. And with home prices rising every month and voluntary programs shown to be clearly ineffective elsewhere, some commissioners said the plan doesn't go nearly far enough.

And if that doesn't work, the county may force developers to build cheaper homes or help pay for them. Sarasota and Manatee commissioners are considering making developers include affordable housing in their plans or contribute into a fund that helps build low-cost homes. The county is also creating a nonprofit trust that will own land set aside for affordable housing and impose price controls on the homes built on the land.

Median Prices Have Considerably Jumped In This Area

As of June, the median sales price of a home in the Sarasota-Bradenton area has hit $336,800, which represents a 39 percent jump from a year ago. To make the $3,044 monthly payments on a home at that price, a household would need an annual income of $121,760, according to the county planning director.

The county planning officer has noted that a considerable segment of the county's work force, from a cashier earning $13,520 a year to a police officer earning $31,179, is being displaced out of the opportunity to become homeowners. County planners have added that the incentives would be intended to get more homes in the $110,000 to $192,000 price range. At present, families are unlikely to find much selection in that price range,according to the county commission.

Housing sales Have Slightly Dipped

Home prices in nearby Charlotte County-North Port market dipped significantly too. The median sales price was down 6 percent, from $223,500 a year ago to $210,300 last month, and this came after a 4 percent drop in July. Sales in that market dropped 30 percent, from 365 in August 2005 to 256 last month.

In the Sarasota-Bradenton area, the drop was 28 percent, from 1,062 to 765. Southwest Florida was by no means alone in either the drastic slowdown in sales or the drop in prices. Slumping sales have been weighing on home prices in most of the country, with the median price of an existing home sold during August dropping to $225,000, which is 1.7 percent below August 2005.

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