Tallahassee Housing Market Health Report • Real Estate September 2019

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Real estate graph confirms the housing market is slowing down
Tallahassee Housing Market Health Report • Real Estate September


Year To Date Home Sales

Our first graph confirms our opening statement; the housing market is indeed slowing down.

Yes, the number of home sales has fallen about 4% from last year, but the number of homes sold still qualifies as the 5th best year on record over the past 18 years! I would not be too quick to cry about a collapsing market, but it is prudent to keep our eye on this to see if the declining trend continues.

There are other factors that we can monitor too that will likely give us a signal that the Tallahassee real estate market is turning for the worse.

Distressed Versus Arms-Length Home Sellers

One way to see problems creeping up on the Tallahassee real estate market is to track distressed home sales continually. Our graph below shows the active listings in the Tallahassee MLS segmented by type (arms-length versus distressed).

Percent Of Properties Distressed in Tallahassee Florida
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In the graph above, the number of distressed listings is shown in green, while the number of arms-length listings is shown in red. The black line measures the ratio of distressed homes in the market, and we can see it remains a declining trend. The declining trend is a positive sign of the market getting healthier. Currently, 9% of all listings are distressed while 91% are healthy arms-length home sellers.

Two Important Distressed Home Ratios

Another view of how distressed properties are impacting the Tallahassee real estate market is shown below. We call this graph the “Market Health Report” and is compares distressed activities to home sales.

The health of the housing market can be seen by looking at recent foreclosure activity
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The graph above measures both new lis pendens filings (the start of the foreclosure process) as well as foreclosure sales (when homes are taken from the distressed homeowner by a lender). Both are important, but so too is the relationship between the two, as we will discuss below.

Overall, both the new filings and the foreclosure sales have come down substantially since the collapse of the Tallahassee housing market. The worst point in this graph can be seen at the end of 2010 when 96 lis pendens were filed for every 100 home sales!

From 2013 through 2014, as many as 40 of every 100 home sales were foreclosures. Those were tough times to be sure.

Today, 4 of every 100 home sales is a foreclosure while a lis pendens is filed for roughly 8 of every 100 home sales. As the market continues to gain more equity (because home values are rising), we will continue to see alternatives other than a foreclosure sale when homeowners get in trouble. Right now it appears one-half of distressed sellers can do something to avoid foreclosure.

We’ve seen the market fall from 96 lis pendens per 100 sales to just 8. Such a decline is a very healthy sign that fewer people are in trouble and is something we’ll keep a close eye on in the future.





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