Maybe not on The Ridge, but in other areas of Florida and the Nation, there is talk of another real estate bubble forming. This would be bad news here on the The Ridge because we derive most of our buyers from other markets. We need them to be strong so those buyers can sell their existing and buy our homes.

With that being said, I saw a graph that explains overall appreciation perfectly. Historically, housing has appreciated on an average of 3.6% annually. (Funny how it resembles the cost of living index) Now we have had numerous annual cycles where home prices have went up much higher than 3.6% but it is usually followed by a correction. None more than the recent boom and bust that our national housing market experienced in the past 10 years but as you can see from the graph below, shows two cycles, the blue lines show if we had straight appreciation of 3.6% annually from 2000. The gray lines show what actually happened. So even though the housing market went way up and proceeded to crash it is still below the average annual appreciation model. This is a very significant graph because it shows that housing is keeping pace. The only caution I would throw in the wind is that wages for a good percentage of Americans have been stagnant but our potential buyers are at the end of their professional career life’s so this appreciation is a good thing.

Bottom Line- This graph shows that housing is following its long term model which is good news for us on The Ridge.