2015 Mid Year Median Home Report
We have compiled the data from the first half of 2015 in order to produce this report on the median home sold in Tallahassee.
As a reminder, the median is one way to calculate the "average" of a group. Normally, when we see the term "average" used, it refers to the "mean" of a group of data, which is just the sum of all numbers divided by the number of numbers in the group. But the "median" is the "middle" value when all the data is sorted in order. Both tell us something about the market, but when we have ample data, the median value is less prone to skewing than is the result of calculation of the mean.
OK, here's what we've done. We sorted all the homes in the Tallahassee MLS that have sold thus far in 2015, and have plucked the one in the middle out so that we understand where this middle of the market is, and how it has moved (trended) in the recent and distant past.
Median Home In Tallahassee
In case we are still confused about terminology, you can see a quick overview of real estate math in a past article that I wrote.
The following graphs help define the median home in Tallahassee, Florida.
First, we see that the median home price is rising at a rate that is similar to what we saw in 2004 through 2006 (right before the market crashed).
If you are a homeowner who is thinking of selling, don't mistake the rapid rise in the median price as an indication of changing home values. This merely reflects the fact that buyers are spending more money when they buy a home. We have to do an "apples to apples" comparison before we can truly measure the real estate appreciation in Tallahassee.
The next graph provides a better estimate of the current appreciation in the Tallahassee real estate market. The blue line below shows the one-year trend of the median home value in Tallahassee, measured in price per square foot for all homes sold.
This is very good news for a market that is still plagued with so many homes with negative equity. We need values to continue to rise so that people who want to move can do so without having to figure out how to pay off the remaining mortgage after the buyers funds have been exhausted.
So what's the different between median prices soaring while median values are simply rising?
The graph shows that homebuyers in Tallahassee are getting more home for the money right now. It plots the median home size (heated and cooled square feet) each month, and look how much bigger homes being purchased today are compared with the top of the market back in 2006.
The median home size today (1,630 square feet) is roughly 10% larger than the median home size back in 2006, and that is likely due to the fact that buyers can borrow money today at lower interest rates and therefore have more money to spend when they buy a home.
The median home size graph is used to ensure that we know the difference between the houses that sell now versus a time in the past. Too often, real estate reports look at average home prices and then mistakenly assume that appreciation levels are changing along the same line, but that would simply presuppose that the homes sold in the past were the same as the homes selling now. The graph above shows that is not the case.
Also, don't make the mistake of thinking that the median home appreciation means that your home is appreciating at the same rate! Yours could very well be appreciating at a faster rate, or if you own a high end home, yours could actually be flat-lined or depreciating.
To find out the true value of your home, we offer a home valuation service that is free of charge and will give you a very accurate report of the market value of your home today. This no-obligation valuation is a critical component to your decision to sell your home, and we can arrange to do it any time that you like.
My recommendation is find out the value of your home before you decide to put it on the market, that way you'll have the information you need to know the best way to handle your move.