Has the real estate market reached its pinnacle value? Is there a market bubble going to burst? I would say no, not anytime in the foreseeable future. Let’s look at some historical numbers.
The real estate market last peaked back in 2006 under a very different market environment. The financial industry had some crazy lending practices while appraisers basically rubber-stamped approval on those transactions. 2006 year-to-date numbers had the median home price of $195,000 or $133 per square foot. The lending interest rates were in the 6-7% range and it took, on average, 125 days to close while we had eight to nine months of inventory supply. We then had the financial collapse of the markets.
Over the next five years the market lost about 56 percent in value. 2011 was considered the bottom of the market. The median home price had declined to $94,000 or $59 per square foot.
Interest rates were in the 4.5 to five percent range and it took, on average, 170 days to close. At times we had over 18 months’ worth of inventory supplies.
Since then, the mortgage and appraisal industries have revamped their procedures setting tighter protections for all parties involved although interest rates declined to the low-to-mid threes percentage rates, providing incentive to the buyer’s purchasing power.
We finished 2021 up almost 190 percent in value compared to the bottom of 2011. The median home price was $275,000 or $171 per square foot, but if we look at the numbers compared to the height of 2006, we have only increased in value about 29%. The average days on market declined to 53 days. The market is sound and in good shape. There are not any red flags blaring. Interest rates may be on the rise, but even with the anticipated rate increases from the FED we are lower than the previous peak rates of 2006. Probably the most supporting attribute to this market sustaining and increasing value is the inventory supply. We are currently maintaining less than one month’s supply of homes and buyers are still seeking homes to purchase.
So, I still affirm that the market will continue to increase in value through 2022 and maybe 2023. As for the January 2022 numbers, the Plant City area had 75 properties sold with 48 of those properties fetching more than $250,000. The median home price was $300,000 or $178.57 per square foot. The average days on market was 16.7.
As always, if you are in the market to buy or sell your home … seek out an experienced professional realtor to assist you in this transaction process. There are too many pitfalls to go it alone without representation. If you have any questions, please reach out.
Sales Snapshot
The following properties were a sample listed as sold on the Greater Tampa Realtors Association MLS in Jan. 2021.
The home at 2001 W Ball St sold Jan 7 for $130,000. Built in 1992, it has 3 bedrooms, 2 bath and 1144 square feet of living area.
The home at 2005 Cedar Run Dr sold Jan 24 for $177,000. Built in 1984, it has 2 bedrooms, 2 bath and 1180 square feet of living area.
The home at 1006 N Palm Dr sold Jan 14 for $201,000. Built in 1955, it has 2 bedrooms, 1 bath and 800 square feet of living area.
The home at 1305 N Barnes St sold Jan 3 for $215,000. Built in 1977 it has 3 bedrooms, 1 bath and 1092 square feet of living area.
The home at 1008 W Terrence sold Jan 10 for $225,000. Built in 1953, it has 3 bedrooms, 1.5 bath and 1434 square feet of living area.
The home at 1601 Paddock Dr sold Jan 3 for $240,000. Built in 1989, it has 3 bedrooms, 2 baths and 1669 square feet of living area.
The home at 401 W Tever St sold Jan 14 for $260,000. Built in 1919, it has 3 bedrooms, 2 bath and 1200 square feet of living area.
The home at 2303 E Trappnell Rd sold Jan 12 for $290,000. Built in 2012, it has 3 bedrooms, 2 baths and 1456 square feet of living area.
The home at 4304 Old Mulberry Rd sold Jan 4 for $300,000. Built in 1928, it has 3 bedrooms, 2 baths and 2748 square feet of living area.
The home 2610 Southern Oaks PL sold Jan 24 for $325,000. Built in 1990, it has 3 bedrooms, 2 baths and 2050 square feet of living area.
The home at 3476 Silver Meadow Way sold Jan 18 for $350,000. Built in 1994, it has 4 bedrooms, 2 baths and 1871 square feet of living area.
The home at 3302 Milton PL sold Jan 10 for $389,591. Built in 1994, it has 3 bedrooms, 2 baths and 1864 square feet of living area.
The home at 4605 Bugg Rd sold Jan 5 for $415,000. Built in 1972, it has 4 bedrooms, 2 baths and 2347 square feet of living area.
The home at 701 Kilgore Rd sold Jan 14 for $442,500. Built in 2014, it has 4 bedrooms, 3 baths and 2500 square feet of living area.
The home at 3308 Cummings PL sold Jan 14 for $480,000. Built in 1996, it has 4 bedrooms, 2 baths and 2507 square feet of living area.
The home at 170 Sparkman Rd sold Jan 14 for $563,900. Built in 1968, it has 2 bedrooms, 2 bath and 1576 square feet of living area.
The home at 3721 Midway Rd sold Jan 31 for $619,000. Built in 2001, it has 4 bedrooms, 3.5 baths and 3088 square feet of living area.