Weekly Special | December 24, 2018

Sticker Shock Slows Home Buyers

The Tallahassee housing market has definitely slowed down, as buyers find themselves looking at homes they can no longer afford (or ones they do not like for the price).

The graph above shows the average price of homes sold in Tallahassee this year, and one category has shot up so fast it has left buyers’ heads spinning.

The blue line in the graph above shows that the average price for a single family detached home has risen more than 10% in 2018, and it’s up more than 18% since the beginning of 2017.

While we saw prices move up rapidly in 2006 during the height of the housing bubble, there is a significant difference in the market today compared to that time.

Back in 2006, Tallahassee was over-built, and yet builders were still constructing new homes, adding to an overloaded inventory until there was a glut. But today, the number of listings at most price levels is far lower than normal and significantly lower than what was available in 2006.

Because inventory levels remain low, there will be a lot less price pressure for sellers as we move forward into 2019. Serious sellers might have to adjust their sites downwards, but the fact that there are so few homes available for buyers, it is not likely we see prices fall. If they do, it will only be if demand falls to historic lows.

Buyers should take a look at townhomes and condominiums if they want a deal, as those prices are still very low.

The original one-page Weekly Special PDF is still available.