Population and Growth Affect The Housing Market in Tallahassee
As the data from the census, which was conducted back in 2010, is continuing to be analyzed, it indicates that Tallahassee has experienced some population growth. Growth is important for the housing market, the more people there are, the need for viable housing increases. Those who are focused on the housing market equilibrium will find this news stimulating. When things are growing, there is movement in all aspects of the area, the housing market just being one. More people means more jobs, better schools, and an overall economic state that is conducive.
It is true that there is a "glut" of homes that have sat on the market in this part of Florida, but a growing population can quickly absorb some of these homes that would otherwise still be sitting. The longer homes sit, the more property values decrease and the housing market doesn't look favorable to those wanting to come into the area. It becomes a buyers' market where homes are sold far below the average, and this affects all properties. Given the data from the last census, analysts can begin to examine the statistics and build a study on how the housing market fairs. While things may appear to be on the upswing, there is still a lot of recovery that needs to be done in Tallahassee. What is starting to occur is a seller's market. This is where the seller's maintain some control, and they don't have to sell at rock bottom prices just to get rid of their homes.
Census Provides Key Details
Leon is the county in which Tallahassee sits. While this county does expand beyond the borders of this town, in general it is the largest city and provides most of the reporting numbers for this region. This area is right on target with much of the US. If a graph was to be done about other areas of the country, they would probably fare very similar to the housing market number in Leon. The latest Census shows that the population of this area increased by an astounding 15% over 10 years. That is an annual rate of about 1.41%. As long as there is some growth, there will be hope for an equal state in the housing market.
The population of Leon County as a whole is 275, 487. The population of Tallahassee is 181,376. Both numbers show incredible growth from years past, which is what is needed for the housing market to stabilize. Going back a bit further in Census history, shows that Tallahassee has grown at an overall growth rate of 2.4%. Using the data provided, we can provide a fairly accurate forecast regarding the housing market and its stability.
The Housing Market Equilibrium-It Can Be Predicted By The Changing Population
Using the data that has been provided, a forecast can be made about the future of Tallahassee and the housing market. Realistically, one must look at the next 25 years to make accurate projections. By 2040, it is estimated that there will be nearly 500,000 people residing in Leon County. However, using conservative data will be easier for some to grasp. There are many people who actively track the home sales in Tallahassee. Currently, there are 2,450 homes listed for sale on the market. These homes are all different price points and are representing the very rich and even the meager. The shadow inventory of homes that is about to be listed or is contemplating listing is around 5-7,000. There are approximately 6,500 homes that have just been sitting on the market, waiting for a buyer. Some of these homes have been sitting since 2007. There are also rental units that are sitting on the market unrented. It is estimated that about 800 units are experiencing vacancy loss each month.
Housing Consumption Analysis
While the data provide above is a general overview, some of these numbers can be reduced for statistical reasons. First of all, every homeowner that has their home on the market doesn't have the intentions of moving out of Leon County. In fact, in general about 80% will stay. While they may go to a rental unit, or buy another home, they are not leaving the city. We cannot rule out people who are staying, as they are retention and not growth or loss. Consequently, the 6,500 that are sitting on the market, they can be reduced to 1,300 using the 80% retention rate. Moreover, the amount of homes sitting on the market is fairly normal for any area. If we remove the number of homes just sitting, we are left with a total of 7,100 homes. This is the "glut" inventory that needs to find new owners.
Each house has an average of 2.34 people residing in it, according to the Census. So, in order for the area to grow to the point where we can have an inventory of homes that is considered in the normal area, we need 16, 614 more residents. This would cause the homes in these areas to appreciate. Appreciation should occur at around 3-4% annually. There is one more piece of the puzzle though; new home developments create an unknown variable. New home developments are often hard to put into the equation. They cause an upset in numbers that can be difficult to track.
Repairing Housing Market Equilibrium
If the following things mentioned above occur by the year 2018, then the equilibrium can begin to go back into balance. Since the numbers have been out of whack for the past seven years, chances are we have seen the worst of it.
There are numerous variables that would cause modification to the forecast, either good or bad, but grounded upon present information; these numbers seem to be accurate. Of chief concern on inconstant data includes how dependent it is on the population growth. However, using the lowest possible projection for population growth, the forecasts are as accurate as they can be. Only time will tell if the market will stabilize. However, the population growth has everything to do with the housing market.