How Is The Tallahassee Housing Market?

Posted by

Joe Manausa

on Monday, March 07, 2016
at 4:53 AM

One common question I get when I meet people and they discover I’m a real estate broker is “how is the Tallahassee housing market?”

For years the answer really didn’t change, words like “glut” and “over-supply” were the foundation of the conversation. But I’m happy to report that is really changing now.

Today we look at one graph that really exposes the past problem and the current remedy for the real estate market in Tallahassee.

Supply & Demand In The Tallahassee Housing Market

In the real estate graph below, there’s a lot going on, but it all serves to create the thin blue line running from left to right. That blue line is the one-year trend of the relative supply of homes for sale in Tallahassee, FL.

The “magic” number we’ve been seeking is 6.0 months of supply, a level that traditionally means the market is in equilibrium (buyers and sellers are trading on equal footing).

The red line and green line show current listings and monthly sales each month (measured on the right vertical axis), while the blue bars show the relative supply of homes each month. The blue line is created by averaging the past twelve months of relative supply, and the gold bar highlights market equilibrium.

How Is The Tallahassee Housing Market?

The market is good. Homes sales are up nicely and overall things appear to be heading back towards normal (my definition of normal is when you decide to sell your home, you can put it on the market and sell it within a reasonable amount of time for a value that has gone up since you purchased it).

But there are still pockets of problems that will take some more time to heal. Some locations in Tallahassee are enjoying the housing market recovery much more than others.

For example, 51% of all home sales in Leon County during the past twelve months were located in NE Tallahassee. That has resulted in a seller’s market in some price ranges and the glut of homes that existed in the past has been whittled down to where just homes over $350,000 are over-supplied.

On the opposite end of the spectrum, the west side of Tallahassee has seen many multifamily units created over the past five years. This will create pricing pressure and increased inventories for single family homes and townhouses on the west side for many years. And therein lies opportunity for buyers.

If you are not tethered to NE Tallahassee, you will find significant values in NW Tallahassee for many years. Consider the west side of town the best bang for the buck if specific location in town is not critical.

Here’s a peak at the MLS listings for Northwest Tallahassee. You can poke around the map or zero right in by price range. Take a look, you’ll see the values are very tempting.