I received a question from a reader that I felt would make a terrific topic for a blog post. "Joyce M." wrote
We will be looking to buy later this year sometime and don't want to over-pay. Property taxes are not low in Tallahassee. What are the best neighborhoods [safety, value, upscale] for homes $300,000-$325,000 range built after 2000 with gas fireplace, and about 2000-2300 sq ft; thanks.
As you can tell, this is not a simple "quick answer" type of question, and it parallels a question I received recently from a long-time friend who wondered what area of Tallahassee was going to appreciate / depreciate faster over the long run. It has been my experience that many people in the real estate brokerage business will give a quick "off the cuff" response to this question, but I have found that this usually means that the answer will be wrong.
The Best Neighborhood In Tallahassee
Choosing the best neighborhood in Tallahassee is a process that each of us could perform and each determine a different answer. What some would consider important in a neighborhood, others might give little or no value at all. So, to answer Joyce's question, I will use what I saw in her message to perform this analysis. Joyce identified the following home selection criteria (I couldn't define "upscale") that she would use to evaluate Tallahassee neighborhoods:
How To Measure Neighborhood Safety In Tallahassee
The best way to determine your own definition of a safe neighborhood is to get out on the internet and research what is important to you. There are plenty of sites that give neighborhood "crime statistics" and I am not so sure that those are the best way to determine safety. You could also take the time to talk to people at the police and/or sheriff's departments for more information.
For the purpose of this exercise, I will conclude with several selections and then let Joyce perform her own analysis for safety in each of those neighborhoods in order to determine whether or not she would remove one or more from consideration.
Appreciation Rates In Tallahassee Neighborhoods
One way to estimate appreciation rates in different Tallahassee neighborhoods it to look at what the average price per foot homes have sold for over a period of time. The most accurate method would require more time than I have, so I will just compare the movement of average price per foot in our sample over time. Unfortunately, because all of the homes are less than 10 years old, there won't be enough information to determine a statistically significant value for appreciation.
Tallahassee Neighborhoods With 2000 Square Foot Homes
In order to find neighborhoods with 2000 square foot homes, I have taken the sales for the past couple of years and have sorted them by home size. By removing all homes below 2000 square feet and above 2300 square feet, I will have a list of all home sales in Joyce's preferred size (I could write an entire blog on why you don't want to buy a home, or even shop for one, by reducing it to purely square footage) and then determined what neighborhoods had the bulk of those sales.
Tallahassee Neighborhoods With Homes Built After 2000
Similar to choosing a Tallahassee neighborhood by size, I can do the same thing by looking sorting all of the sales data by the year a home was built. And just as I would not use square footage as a specific disqualifier in the home selection process, I would also not use the age as a disqualifier. There are many updated homes built prior to 2000 that are every bit as nice (or nicer) than ones built after 2000.
Choosing The Best Tallahassee Neighborhood For Joyce
With over 50,000 sales to sort through since 2000, we appeared to have plenty of data to help Joyce make her pick. But once we eliminated all homes sold that were under 2,000 square foot and those that were larger than 2,300 square feet, we were left with less than 4,000 homes. Applying the age criteria left us with a final total of 917 homes built on or after 2000 between 2,000 and 2,300 square feet.
The following table shows our results. I do want to emphasize that a real estate professional would be able to utilize specialized tools and processes to help Joyce perform a more personalized search than this, but I felt this would be a good exercise to target some neighborhoods that would fit her needs.
Based upon what we are seeing below, the average home that Joyce is describing has dropped 15% from the height of the market and has recently sold in the mid $260s. She can either spend less money that she expected, or she can choose from the best of what is available.
So, my answer to Joyce's question (drum roll please) is that the three neighborhoods that appear to best be holding value are Lake Cassie, Golden Pheasant, and Eagles Ridge, and I would recommend she start her search in those Tallahassee neighborhoods.
|Tallahassee Neighborhood||Sales Since 2000||2008 Average Price||Peak To Now|
|Price||Price / Foot|
|STONEY CREEK CROSSING||83||$262,835||-13%||-11%|
|SWIFT CREEK WOODS||46||$238,728||-14%||-11%|
|OX BOTTOM MANOR||8||$290,250||-100%||-100%|
|VIEUX CARRE (STERLING HOUSE)||8||$369,125||-15%||-20%|
|GREENS OF KILLEARN||5||$307,780||-14%||-13%|
|GLEN AT GOLDEN EAGLE||3||$228,967||-19%||-20%|
|INDIAN HEAD ACRES||2||$225,000||-100%||-100%|
|OAK HILL FARMS||2||$274,750||-100%||-100%|
|RESERVE AT THE RIDGE||2||$317,450||-100%||-100%|
|BARRINGTON CIRCLE OFFICE CONDO I||1||$400,000||0%||0%|
|GOLDEN EAGLE UNIT 8||1||$360,000||-100%||-100%|
|LANDINGS OF GOLDEN EAGLE||1||$195,000||-100%||-100%|
|OAK PARK PROPERTY||1||$282,500||-100%||-100%|
|POWDER HORN WOODS||1||$165,000||-100%||-100%|
|WALTON CORNERS UNREC||1||$290,000||0%||0%|
|WEEKS HIDDEN LAKES||1||$289,500||0%||0%|
|WILSON GREEN TOWNHOMES||1||$121,900||-100%||-100%|
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Joe Manausa, MBA is a 26 year veteran of real estate brokerage in the State of Florida and has owned and managed his own company since 1992. He is a daily blogger with content that focuses on real estate analytics and providing his clients with a tactical advantage in today's challenging market.