Weekly Special | January 13, 2025

8 Straight Months Of YoY Declines

In December, home sales fell 5% year-over-year, continuing the affordability cooldown from over two years ago. This graph effectively evaluates non-seasonal housing market fluctuations, as each vertical bar indicates the monthly percentage change in home sales compared to the same month last year.

After eight consecutive monthly declines through December, professionals in real estate, mortgage, title, and related industries observe the market moving toward neutrality as the relative supply of homes grows slowly.

Primary reasons for slow sales include low inventory, high home prices, and mortgage shock. Homeowners feel stuck in their homes because their mortgage rates are half of today’s rates. Ironically, although today’s rates are appealing because they lie well below the 50-year average, they remain higher than the historically low rates of the past five years.

Newcomers to real estate worry about low home sales, but the 3,230 sales in 2024 exceed the 2,213 recorded in 2011 by 46%, although they remain 14% below the average since 2002.

Tallahassee Stronger Than US Market Tallahassee enjoyed more home sales in 2024 than the typical US MSA, but we’ve got the same inventory and affordability problems as everywhere else.

The key to a forecast for Tallahassee rests with these two variables with an emphasis on mortgage rates. Most reporting agencies are forecasting rates to come down to the low 6% range when the Fed makes its next cuts, but if that doesn’t happen, we’ll see even fewer home sales in 2025.

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