Wednesday, October 23, 2013

3rd Quarter 2013 Tallahassee Residential Real Estate Market Snapshot And Year Over Year Market Statistics.
  
  
Well Tallahassee's real estate market continues to improve in the 3rd quarter of 2013 when compared to the same time a year earlier.  We saw overall improvements in all of the metrics from the 3rd quarter of 2012 to the 3rd quarter of 2013.  Based on the improvements it seems that Tallahassee's local real estate market is recovering from the real estate bust, and is returning to more of a historically traditional and balanced real estate market.
 
First of all, the number of residential properties listed for sale in Tallahassee increased by 26.2% year over year in the 3rd quarter of 2013.  This is great news because in the last year and a half or so we have had a shortage of housing inventory making it hard for homebuyers to find a home that fits their needs.  The shortage of housing inventory has led to many bidding situations on properties, so this recent increase housing inventory is good news for homebuyers as it will provide them more homes to choose from.
 
In addition to the increase in the number of properties listed for sale, we also saw a whopping 29.3% year over year increase in the number of properties sold in Tallahassee in the 3rd quarter of this year.  The increase in home sales has largely been a product of an improving economy in the state of Florida, affordable home prices and low interest rates on home loans.  Also lenders have very slowly been relaxing a little bit on lending standards making it a little bit easier for buyers to obtain home loans.  I emphasize a little bit because lending standards are still more strict compared to historical norms.  The overall increase in home sales is a sign of an improving local real estate market though.
 
The year over year average sales price of residential property also went up in Tallahassee in the 3rd quarter of this year.  The increase in the average sales price was only a modest 3.03%, but that falls in line with the rate that homes have historically appreciated by.  This rate of increase seems to be a sustainable rate of increase, so this is one sign that we are back to more historically traditional real estate market conditions.  This should spur more buying and selling of property as more people regain the confidence that real estate is again a safe investment. 
 
Another sign that the real estate market is improving here in Tallahassee is that the sale price/list price ratio for residential real estate increased in the 3rd quarter of 2013.  This ratio measures what the average home sells for compared to what it's listed for sale at.  In the 3rd quarter of 2013 the average home sold for 96.61% of what it was listed for sale at.  That is up from 96.01% in the 3rd quarter of 2012.  The increase in the average sale price/list price ratio indicates that there is healthy buyer demand for residential properties, and that people selling residential properties are listing their property for sale at close to what it's market value is. 
 
The fifth metric I look at is the average number of days a property sits on the market before it sells.  This also improved in the 3rd quarter of 2013 from the same time a year ago.  The average time a residential property sat on the market before it sold decreased by 22.2% from the same time a year earlier.  This means that homes are not lingering on the market as long which is an indication that sellers are pricing their homes to sell and that there is an increase in buyer demand for homes both of which are positive things for Tallahassee's real estate market. 
 
Last but not least, the total number of distressed sales (foreclosures and short sales) compared to the total number of home sales in the 3rd quarter of 2013 decreased by 9.1% from the same time a year ago.  Distressed sales only made up 13.9% of total sales in Tallahassee in the 3rd quarter of this year which is much better than 23% last year at this time.  This is great news!  Distressed sales typically sell at a discount compared to normal sales. These discounted sales prices typically depress overall home prices by bringing down the values of surrounding properties.  The large number of distressed sales over the last few years has continued to keep home prices down, so the fact that distressed sales are now making up a smaller portion of total sales leads the way to increasing property values. 
 
Overall Tallahassee's real estate market is continuing to improve.  It will most likely continue to improve, and prices will most likely increase modestly in the foreseeable future.  A couple things that could hinder the recovery would be if we have a sharp increase in interest rates or if the number of short sales and foreclosures begins to increase again.  Interest rates will most likely go up, but probably modestly, and foreclosures and short sales will probably to increase slightly in Tallahassee as banks begin to unload property again.  However the improved economy and increase in buyer demand will most likely be enough carry our real estate market in a positive direction in the near future.
 
The summary of the 3rd quarter real estate metrics is below.
 
  • 26.2% increase in the number of properties listed for sale. (1,297)
  • 29.3% increase in the number of properties sold. (887)

  • 3.03% increase in the average sale price ($185,035 average sale price)

  • 0.6% increase in the average sale price/list price ratio (96.61%)

  • 22.2% decrease in the average number of days on the market. (98 days)

  • 9.1% decrease in the portion of distressed sales compared to total sales.  (13.9% of all sales were distressed sales)

Thursday, May 16, 2013

1st Quarter Tallahassee Real Estate Market Statistics


1st Quarter 2013 Tallahassee 

Residential Real Estate  Market Snapshot.


It appears that the overall health of the local residential real estate market in Tallahassee has continued to move in a healthy direction through the first quarter of 2013.  Sales are up year over year in quarter one of 2013 from quarter one of 2012.  Also, the total number of properties listed for sale has also increased.  The increase in the number of properties listed for sale is most likely a result of increased confidence in the real estate market stemming from a sharp year over year increase in the average price of a home in Tallahassee in 2012. The recent increase in property values in Tallahassee has also probably lifted some homeowners who previously wanted to sell but could not from being underwater on their mortgages thus enabling them to now have the ability to sell their homes.  

Other positive signs that Tallahassee's residential real estate market is heading in the right direction is that the average sale price/list price ratio increased.  Also, the average number of days a property took to sell decreased.  Finally, both the ratio of distressed sales compared to total sales decreased as well as the total number of distressed sales decreased in the 1st quarter of 2013 from the same time period a year before.  

The average sale price/list price ratio is the percentage of what a property sells for compared to what it is listed for sale at. The higher this ratio is, the healthier the real estate market typically is.  
The decrease in the ratio of distressed sales compared to total sales indicates that the real estate market is getting better since distressed sales typically sell at a discount thus depressing the values of surrounding properties and the overall market.
The only negative aspect of this data, which might not even be that negative, is that the average sales price was down a tiny bit in the first quarter of 2013 compared to the first quarter of 2012.  This might not be a result of negative market conditions, but instead a result of the increase in the supply of homes on the market.  The increased supply seems to have caused prices to keep from increasing.  However, there will likely be an increase in demand for housing too with the job market improving which will most likely cause the newly increased supply of homes to be absorbed.  Most likely, home prices in Tallahassee will continue to hold steady and increase very modestly into the near future.  
A snap shot of the year over year market statistics for the 1st quarter of 2013 are below.  If you have any questions about any of these market statistics, please don't hesitate to contact me! Remember, an informed consumer will always have the edge over the uninformed consumer!
  • 8.7% increase in the number of properties listed for sale (1,254)
  • 10% increase in the number of overall properties sold (570)
  • 1.2% decrease in the average sales price ( $170,681)
  • 2.05% increase in the overall sale price/listing price ratio (96.46%)
  • Average days it took a property to sell decreased 30.9% (121 days)
  • Foreclosures and short sales in 1st quarter of 2013 made up 23.5% of total sales which is down from 29.3% in the first quarter of 2012.  

Monday, February 25, 2013

Snapshot of 4th Quarter Tallahassee Residential Real Estate Market Statistics


Just pulled the 4th quarter Year over year residential real estate market statistics for Tallahassee and it's looking pretty good.  In a nutshell, prices are up a good bit, sales are way up, number of listing inventory is slightly down, properties are selling closer to what they are listed for sale at, and properties are selling quicker. Finally, the number of distressed sales (foreclosures and short sales), expressed as a percentage of total sales, is down.  If this trend continues, it's looking like it will be a good year for residential real estate in Tallahassee.  For quite a while, the fundamentals of the real estate market here in Tallahassee have been getting better.  Supply of properties has been coming down for a couple years now, and the number of properties selling has also been increasing for a couple years now.  However, the impact of foreclosure and short sales have caused prices to stay down.  Until now that is.  For the first time in a while, the number of foreclosures and short sales expressed as a percentage of total sales, has come down.  At the same time ( and I don't think this is a coincidence) home prices have come up in a big way posting an 8.8% year over year increase in the 4th quarter of 2012. Since this is the first quarter I have seen since the boom years of the mid 2000's where we have had a large year over year increase in prices like this, I think it could be too soon to say our real estate market has turned the corner completely.  However, if we have another quarter or two like this, I think we can say our real estate market here in Tallahassee is back to a much healthier condition.   The snapshot of the statistics are below for the 4th quarter are below.

8.8% Year over year increase in average sales price ($178,485)

37.2% increase in the number of overall properties sold (667)

2.3% decrease in the number of properties listed for sale (799)

0.49% increase in the overall sale price/listing price ratio (94.95%)

Average days it took a property to sell decreased 3% (142 days)

83.48% of the properties listed sold in the 4th quarter of 2012. Up from 59.49% a year earlier.

Foreclosures and short sales in 4th quarter of 2012 made up 23.2% of total sales down from 25.7% of total sales a year earlier.