U.S. Gov’t Shutdown Minor Effect on Home Market


SARASOTA, FLORIDA, December 23rd, 2013 – The impact on the home market of October’s 16-day partial U.S. government shutdown proved to be rather minimal, Sarasota Bay Real Estate reports.

Our company notes that the prevailing sentiment in the industry is that there wasn’t much damage to the home market with the stoppage in the operations of such government agencies as the Internal Revenue Service (IRS). Loan processing and closing continued during the hiatus, as most banks and other lending institutions adopted short-term measures to work around the IRS tax transcripts as part of the documentation of mortgages.

Manageable backlog


Even with the shutdown of the Federal Home Administration (FHA), the operations of many lenders continued, and hence, this had no significant adverse effect on the market. Any backlog in FHA loan approvals that may have developed with the work stoppage in the agency isn’t expected to create any significant issue.

Delays in USDA home loans, which were completely shut down for just a little over two weeks also seem negligible. The IRS documentation required on these borrowings can now be obtained, and with loan processing restarted, getting back to normal won’t pose much of a problem. The significant slice of cash sales (which need no loan documentation) in the U.S. home market also helped cushion whatever negative impact the government shutdown may have on the residential real estate sector.

A robust third quarter to lean on

Sarasota Bay Real Estate adds that the residential real estate market in Manatee and Sarasota counties was riding on the strong momentum of the 2013 third quarter when a budget impasse in Congress led to a paralysis in Washington’s operations in October. This strength should enable the local market to overcome a short lull in activity.

Double-digit gains were registered on closed sales and prices for single family homes and condos during the third quarter in the North Port-Bradenton-Sarasota MSA.  Single family residences sold during the period rose by 13.9% year-over-year to 3,276, while median sale price increased 21.2% to $206,000.

The advance in properties sold was even stronger for condos and townhouses which posted a 26.8% increase in closed sales to 1,442 units. The median sale price for these residential types rose 13.4% to $153,000 in the third quarter.

Strong homebuilding activity sustained

Market activity in the MSA remains at a feverish pitch, the realty firm says. For instance, at The Links, a new phase opened recently at the Rosedale Golf & Country Club, over half of the 224 home sites in the original plat were already either sold or on the reserved list.

Homebuilders have their hands full in this new neighborhood in East Manatee. They have filed 45 permits to build new homes at The Links, some of which are models while others are spec homes or constructions with pending buyers.

Several new listings of existing Rosedale residences have also been added recently in the MLS of Bradenton area homes for sale. Priced in the $400s, these properties have floor plans of approximately 2,400 square feet, featuring two to three bedrooms.