Just How Oversold Are The Luxury Homes For Sale In Tallahassee?

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Most Real Estate Agents Have No Marketing Budget

Realtor at work in TallahasseeThe average real estate agent in Tallahassee will only sell five homes this year, and more than half will sell two or fewer. This means they do not earn enough money to spend the significant amount it takes to attract MANY buyers to your home.

They certainly cannot spend the type of money needed each day to promote your home and generate the buzz you need to attract MULTIPLE buyers. We are effective. And we spend more money each month marketing our listings than most agents earn in a year.

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Discussion

#1 By Zackery Scharlepp at 7/11/2017 3:49 AM

Defining high end homes at $400,000 and above for a period of 20+ years seems like that alone would skew the data. I would imaging with inflation and historic levels of appreciation, not including the boom, that a $400,000 house sold in 1991 to a much higher sales price today. It appears that the graph is not comparing apples to apples over the course of time.

#2 By Joe Manausa at 7/11/2017 3:49 AM

Thanks for commenting Zach. I think I have addressed your points though. Tell me what you think:



1. Defining high end homes at $400,000 and above for a period of 20+ years seems like that alone would skew the data - It does not skew the data, but you could argue that the term "high end home" has changed. I agree. So imagine this article is about $400K+ homes and we'll omit calling them high end (though even today, over $400K is only 8% of the market). The point of the article is that we have built and sold far too many homes priced over $400K, and when interest rates rise, there will be 10 to 15 sellers for every 1 buyer.



2. I would imaging with inflation and historic levels of appreciation, not including the boom, that a $400,000 house sold in 1991 to a much higher sales price today - Agreed and accounted for. When you look at the orange "forecast," it includes adjustments for both inflation and population growth.



3. It appears that the graph is not comparing apples to apples over the course of time - Agreed. But again, not the point. The forecast shows how many people can afford spending $400K on a home based upon all the variables, and mortgage interest rates are one variable that will not hold-out forever. Regardless of whether an apple or an orange, if you ask more than $400K (in the future when interest rates return to normal), your "fruit" will be competing with 10 to 15 other sellers for the one fruit buyer.

#3 By Zackery Scharlepp at 7/11/2017 3:49 AM

Joe, thank you for your response. While I do not doubt that Tallahassee has overbuilt its luxury home market, the percentage increases you cite in your post are misleading. If you are defining luxury home as a home over $400,000 today, in order to compare these sales over past years, wouldnt it make since to calculate what a $400,000 home today would have been worth in 1991 and moving forward, and then take the number of homes sold in those years above that price point, and compare it to homes sold over $400,000 today. According to a basic inflation calculator, $400,000 in today's money is equivalent to $700,000 in 1991. In reverse, $225,000 in 1991 is roughly equivalent to $400,000 today.



I would be curious to see the data to see what the percentage of home sales over $225,000 was in 1991, compared to percentage of home sales over $400,000 today.

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