Will The Single Family Homes Market Continue To Recover In 2014?
If you are interested in the single family homes market in Tallahassee, then you are not alone.
The downturn of the Tallahassee real estate market that began in 2006 has created a situation in which tens of thousands of people are upside down in their homes (meaning they owe more on the home than what it is worth).
For people who weren't planning on moving any time soon, it is no big deal, but what about the people that want to sell their single family homes and need to move?
Repairing The Single Family Homes Market
If you have studied any of our reports on supply and demand in the Tallahassee real estate market, then you know the market for single family homes has been improving over the past few years. The glut of supply is falling, and many price-ranges are starting to see real estate appreciation return to the market.
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The key to seeing this recovery in 2014 rests in the hands of home buyers. Will they continue to creep back into the market to take advantage of great values and low interest rates, or an external event cause them to slow their return? Also, will they continue to consume the glut and forego the new construction homes for sale in Tallahassee?
Single Family Homes Sales TrendThe following real estate graph shows the breakdown between new construction and existing sales of single family homes in Tallahassee.
The average number of home sales each month (measured on the left vertical axis) is shown for both new construction homes (red area) and existing home sales (green area). The ratio of new single family homes sold to the overall market is plotted as a red line and measured on the right vertical axis.
Currently, the percentage of single family homes sold each month that are brand new is at a 22+ year low. While this is bad news for current home builders, it is good news for the market and good news for everybody in the long run. This means that the single family homes sold lately are coming from the glut of supply, thus improving the market and help us move towards market equilibrium.
So long as we continue to see increased demand and limited construction of new single family homes, the housing market recovery will continue to broaden in 2014.