Record High Home Sales June 2015
Hey Tallahassee, how about some more good news about home sales!
There were more than 400 closed home sales reported in the Tallahassee MLS in June, the first time the market has been north of 400 in a calendar month since 2007. To put that into perspective, it was the best month going back 106 months including September 2006 (August 2006 showed 503 closed home sales).
Graphic Shows Improving Homes Market
Monthly home sales are still measuring at levels consistent with the 1990s (and our population has grown about 40% since that time), so there is a lot of upside left in the Tallahassee real estate market.
In the graph above, the number of home sales recorded in the Tallahassee MLS each month are shown as a small green dot, and then the one-year moving average of those dots are shown as a green line.
Over the past twelve months, home sales in Leon County averaged just below 300 per month. Looking back to the left side of the graph, the average coming out of 2001 was over 300 per month. I do not think we have too much longer before we are finally comparing current levels with those reported after 2000.
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Why More Home Sales Are Needed
So many people purchased homes from 2002 through 2007, and that means there should be many people today (from that purchasing time period) who are ready to move.
Historically, the average move-time for a homeowner was 7 to 10 years, and that means that a large group of homebuyers were ready to start moving around 2010 through today. Unfortunately, home values are not as high as they were when this group purchased, so many of them are handcuffed to their homes unless they are prepared to do a short sale and give the property back to the bank.
People who absolutely had to move often times utilized these solutions, but the majority continue to wait for values to recover.
And this is why "more" home sales are needed. The increasing amount of sales have whittled down the inventory substantially, though we still remain in a buyer's market for all of the West side of town and above $300,000 in all areas. If demand continues to rise, we will see lower price ranges move into a seller's market and that will help values start to move high enough to really make a dent in the inventory (and shadow inventory) of homes.
So keep on rooting for the Tallahassee real estate market, and I'll keep reporting on its progress. If you have further questions not addressed in the post, simply drop me a note and I will respond as soon as possible.