If you are thinking about purchasing a home in the future, waiting may not be your best option.
There are thousands of people every day moving to Florida. The population increase over the next 10 years is significant do to the Baby boomer population coming into retirement age. Many of the people have a stronger desire to move to the North Florida region instead of flocking further South. This will have a great impact on a City like Tall due to our shortage of available land to handle the influx of people identifying this city or area as the place they want to retire. Obviously this will have an impact on supply vs. demand.
Overall available land in Tallahassee/Leon County is dwindling due to the established urban service line, property owned by large landowners, such as the city, county, state, universities, plantations and the forest service.
The Comprehensive Plan has further restricted growth in Leon County by requiring a three acre minimum lot outside the urban service area, and a ten acre minimum lot in the rural area. Remaining land available is also challenging to develop due to topography, soil conditions and governmental regulations and approvals.
Prices for these lots are prohibitive for most consumers, thus buyers are moving to the outer counties to purchase smaller lots of one-half acre or more at a price they can afford, even if they have to travel a little further to work.
Developers are forced to increase the density of their communities to produce lots that are affordable to the average home buyer. Few one-quarter acre lots are being developed, with most small lots in Leon County being developed for town homes and patio homes.
The property that may affect the availability of lots in Leon County is the number of lots realized from the development of Fallschase, Welaunie Plantation and Southwood. The prices of the communities may not be affordable to most buyers.
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In 2004, an estimate of less than 5600 lots existed in the Tallahassee/Leon County area, with the exception of Bull Run, Welaunee and Southwood. Each year, Tallahassee/Leon County normally averages approximately 1200 building permits per year. If all 5600 lots were for sale and could be purchased, these lots would be gone in four to six years.
As the inventory of lots is reduced, the cost will increase, and that is what has happened in Tallahassee. Lots that were purchased for $20,000 to $30,000 a few years ago now cost $40,000 to $60,000 making it difficult for an average family to purchase a home.
The next increase in lot prices will occur when Senate Bill 360- Infrastructure Planning and Funding is enforced by local governments statewide. Requiring new developments to contribute toward costs for transportation, water and school infrastructure programs, elements of the bill could increase the price of a lot by $10,000 to $30,000.
If you are thinking about purchasing a home in the future, waiting may not be your best option. With the expected increase in land cost over the next few years and building costs that rise over 5 % a year, now is the time to buy. Home owners can enjoy the equity they will have in their home in the next few years, rather than never being able to have a home because their income cannot keep up with long term real estate inflation.
lease look for article 5 in next week’s Sunday paper.
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