Over the past year, the demand for upscale real estate near Sarasota surged rapidly. In 2022, however, the consumer demand somewhat slumped. According to some experts, upscale properties all over the state are taking longer to sell and receiving fewer offers than last year.
“We are now observing market normalization,” says Peter Laughlin, co-founder of Peter G. Laughlin Group in Premier Sotheby's International Realty. “Properties stay in the market longer than before.”
Although many realtors observe a certain slowdown in the residential property market in the second half of 2022, the upscale real estate sector still demonstrates a great performance. In July, an estate in Harbour Acres was sold for $17.5 million, setting a new record for Sarasota County.
Chris Jones, Professor of Economics at the University of South Florida and founder of the consulting firm Florida Economic Advisors, has previously declared that despite a certain economic slowdown, the sector of upscale real estate will stay afloat. “The reality is, when real estate reaches such price levels, it no longer follows general trends,” Jones said.
Nevertheless, Laughlin noted a considerable slowdown in the upscale real estate market over the first four months of 2022. Buyers became less active and more prone to negotiations concerning the properties they were looking for.
This encouraged some owners of upscale real estate to auction their property. For instance, on September 24, Elite Auctions from Naples will sell by auction a 603 m2 mansion on the Gulf coast, at 8347 Midnight Pass Road in Siesta Key. Siesta Key was previously sold for $6.5 million in June 2021 and for $7.5 million in late August. After that, the price increased to $7.9 million.
One of the reasons why sellers decide to auction their properties is to create urgency. Besides, this is a way to attract the attention of potential buyers.
“Auctions attract various buyers and can increase the property value in many cases,” Laughlin said.
Randy Haddaway, CEO at Elite Auctions, said people were auctioning their properties for the same reasons why they do it with artworks. “We can create urgency,” he says. “We can make people come and compete.”
According to Haddaway, the market of high-end real estate has undoubtedly slowed down, and not only in southwest Florida but also nationwide.
Nevertheless, Laughlin doesn’t think it has become a buyer’s market. “Quality real estate at the right price still sells quickly,” he said.