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I believe that the stages that the Tallahassee real estate market must go through to complete the market correction are both predetermined as well as predictable. The key is to pay attention to home inventory changes and buyer activity, as we do both daily here at the Tallahassee Real Estate Blog.
Real estate trends do not change overnight, so we should be able to see them coming. If we know what part of the cycle that we currently are working through, then we should know what the next change will look like.
Real Estate Market Forecast
It is knowing the five sequential phases in a market turn that allows us to anticipate these current and future real estate market changes.
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Home Inventory changes from a growth trend to a reduction trend. |
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Home values fall at an accelerating rate. |
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Year over year home sales increase. |
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Home inventory levels reach market stability at 6 months of supply. |
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Home Values stop falling and begin to rise. |
Real Estate Trend Continues Downward In Tallahassee
Unfortunately, we have to report that home sales declined 37% in April as compared to April of last year. The remarkable streak of 34 straight months of declines continues in Tallahassee, even while some of the larger markets nationwide are seeing year over year growth in home sales.
When will this streak end…it is hard to say exactly, but we will know. By monitoring the one-year trend of daily buyer activity (posted on The Market Bulletin), we will know when the buyer trend turns upward and we should be able to predict the month that will show a year-over-year increase in home sales in Tallahassee.
But when we look at the real estate graph above, we are clearly in the longest continual trend ever recorded in the past 20 years, either good or bad. Even in a market with a clear trend (such as our current downward trend) to have months that oppose the trend. I suspect we need to have a few of those before we see the third phase of our real estate market turn.
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Keep checking out the Tallahassee Real Estate Blog every day for updates that include charts, graphs, and analysis of the Tallahassee real estate market.
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Joe Manausa is a real estate investor and the Broker and Co-Owner of Century 21 First Realty. He can be reached via e-mail through the Tallahassee Real Estate Website or catch his latest writings on the Tallahassee Florida Real Estate Blog , or by calling (850) 386-2001.
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