Minneapolis real estate and other Twin Cities area communities had a good year in 2012 and it is expected that the trend will continue in 2013 for home sellers
A few things are working in our favor here in Minnesota, as far as real estate sales are concerned.
First, Minnesota has a low unemployment rate. And we don’t just mean “relatively low,” as it’s hovering just above 5 percent right now.
Second, Minnesota, and in particular the Twin Cities area, has an incredible employment base. The state is home to huge corporations, small businesses, manufacturing, financial, creative, theaters, art. Being on the river, we even have longshoremen. Pretty much whatever you want to choose for a career, you can do here. This is leading to an influx in new residents needing housing.
Third, interest rates have been at historic lows. That means that people who qualify for a home loan are able to take advantage of incredibly low prices that might not always be around.
Fourth, thanks to the dwindling foreclosure rate and the three factors listed above, the inventory of homes for sale has gone down from 20,000 to just 14,000 available homes on the market in 2012.
The combination of forces...
Nationwide, it seems the housing market is heating up, just
as it does nearly every Spring and Summer – including in the Twin Cities area.
Even with those seasons passed, the interest rates are still low with plenty of homes available on the Twin Cities real
estate market. That considered, more and more Minnesotans are pondering if they are ready to
buy a home yet. There are many things to consider, especially for those who may
be first time
Here are some questions and some possible answers to think
of if you are considering buying
planning to stay put? If the answer to this is no, you might want to
reconsider buying a home. If you think you are planning on stay in an area for
any less than 5 years, it may be worth it to really determine if buying a home
is right for you.
done your research? There is a lot of research associated with buying a
home. That includes what city or neighborhood might be best, where the real
Buying a home is now more affordable than it has been in the last twenty years.
That is, according to this CNN article. Due to declines in home prices and nearly record-low mortgage rates, the National Association of Home Builders/Wells Fargo Housing Opportunity Index now registers a record level of affordability.
According to the index, 75.9% of all new and existing homes sold during the three months ended Dec. 31 could have been comfortably purchased by families earning the national median income of $64,200.
That was the highest percentage recorded in the 20-year history of the index, and a sharp increase from just three months earlier when 72.9% of all homes sold were considered affordable.
The National Association of Realtors reported that in January, home prices fell to their lowest point in more than a decade, which has helped to lift the pace of home sales. The median home price in January fell 2% from December to $154,700. That's the lowest since November 2001, before the run-up in home prices that eventually crashed the market.
The pace of sales rose to the highest level since May of 2010. The seasonally-adjusted annual sales pace of 4.57 million homes was up a bit from the revised 4.38 million in December. The last time homes sold at that pace, buyers were rushing in order to qualify for the $8,000 homebuyer's tax credit as it was about to expire.
Unfortunately, despite the affordability and apparent signs of recovery, most Americans are having trouble buying a home. The main reason is that potential home buyers are finding it extremely difficult to qualify for mortgages due to tightened lending standards. Borrowing troubles are even extended to...
There are two new assistance programs available in Minneapolis for home
buyers and home owners, but act fast because they are limited in
availability and funds.
First, Neighborhood Housing Services of Minneapolis is offering home
buyers in North Minneapolis a $5,000 forgivable loan towards the down payment of a home if a purchase agreement is signed by May 31 and the
sale is closed by August 15. If the new owner lives in the home for 5
years, the interest-free loan will be forgiven. There are no income
restrictions for qualifying. Loan funds for this program are limited to
$100,000, so when it's gone, it's gone!
Second, homeowners and buyers in foreclosure-impacted neighborhoods
of Minneapolis can apply to the City’s Rehab Support Program. It has a fund of $750,000 with which to finance to complete improvements, potentially increasing the home’s market value. The pilot program offers loans of up to $20,000 at zero-percent interest. Funding the City
received from the Minnesota Housing Finance Agency will be matched
dollar for dollar by the homeowner from any other source they choose.
Approximately 50 loans will be available through this program. The
program is available to qualified homeowners and buyers in neighborhoods
where 10 percent of the housing stock is in foreclosure. Eligible
neighborhoods are: Shingle Creek, Lind-Bohanon, Webber-Camden,
Cleveland, Folwell, McKinley, Jordan, Hawthorne, Willard-Hay, Harrison
and Near North on the city’s Northside and Central and Bryant
neighborhoods on the Southside. Check out the City of Minneapolis
website to view further restrictions.
If you're a home owner or home buyer that fits these qualifications
in Minneapolis, it could be worth looking into these programs.
Last year was the worst for home sales since the Minneapolis Area Association of Realtors began tracking home sales in the Twin Cities metro area nearly 10 years ago. The number of Twin Cities homes sold slipped in 2010 to 37,365, down 17% from 2009. It was even lower than 2008, which many industry experts had hoped was the bottom of the market. Median sales prices did rise a modest 2.3%.
Rob Grunewald, associate economist for the Federal Reserve Bank of Minneapolis, said that while the construction industry saw more promising numbers during the last weeks of the year, a full thaw for the housing market isn't likely during 2011. "While the overall Minnesota economy is expected to recover moderately in 2011," he said. "The housing industry faces conditions that will likely keep home prices and building at relatively low levels."
Though 2010 started off at a run due to the $8,000 federal first time home buyer tax credit, once it expired expectations for the year were low. At the end of the April deadline, Twin Cities real estate sales practically stopped in its tracks. Prices didn't plummet drop significantly as expected because of an increase in sales of traditional listings and upper-bracket houses, while prices of lender-mediated foreclosure and short sales properties fell.
"It was like two different markets," said Pat Paulson, president of the Minneapolis Area Association of Realtors. He said that during the last week of April there were 1,460 pending sales, the highest weekly level since 2005. Since then sales have fallen to about 600 deals a week with the exception of the last couple weeks of the year.
"The last half of the year is fresh in my mind, and I'd say it was disappointing," he said. "We knew there'd be a drop-off, but we didn't expect it to be such a steep drop. But the good thing...
The Parade of Homes will mark its 62nd fall event during its run from September 11 through October 3. The Parade this year will feature about 330 Twin Cities homes in 80 metro region communities that range in price from $144,900 to $3,485,000.
The Parade of Homes is a resource for Minnesotans to see hundreds of new homes. The Parade was designed to encourage prospective home buyers to compare styles, locations, construction techniques and materials. It also helps people to find ideas and inspiration.
Parade of Homes visitors can also attend more than 40 informative events. The new Showroom Tour includes 15 stops with the latest and greatest in appliances, cabinetry, bath fixtures, flooring, stone and landscaping products. Additionally, 29 local restaurants are featured on the Parade of Homes Restaurant Tour, each offering discount coupons for Parade participants.
The Parade of Homes Remodelers Showcase will be open the final three days of the fall tour, Oct. 1-3. With 74 remodeled homes featured, there’s even more opportunity to explore.
Minneapolis and St Paul Zero Down Payment Loans
No Down Payment Saved? NO Problem!
The Affordable Advantage program has arrived to Minneapolis - St Paul! We have been eagerly awaiting this zero down payment loan program for a few months. If you’re like many Minnesota first time home buyers, saving down payment is tough with everything else you have to pay for. We get it! This couldn’t come at a better time – lower rates, super low home prices and it being a “buyer’s market.” Who could ask for more?
So what about the issues some people have when using FHA financing? Will this still be a problem? All loans can have their issues, but this is NOT an FHA loan. It is conventional financing so you have a better opportunity getting an offer accepted on a home that DOESN’T allow FHA financing – whatever that reason may be.
Here are the stats on the program:
• No monthly mortgage insurance
• No down payment
• One unit single family, townhome or condo
• Minimum credit score of 680
• You need $1000 of YOUR money, not a gift
• Must attend the Homestretch class
• Must be a first time buyer
• Maximum income for a household up to 4 is $83900
• Seller can pay up to 3% of the sale price toward your closing costs
Let’s hope this great program can be the one that makes you a homeowner in 2010!
Is it cheaper to buy a home than it is to rent a home? In some cities, renting is more expensive than buying!
Trulia.com recently released its new Buy vs. Rent index, ranking the top 10 cities in the United States where buying a home makes most financial sense. Minneapolis (and by close relation St. Paul and most of the metro area) has landed on that list. Though Minneapolis didn't see the same huge spike in real estate prices that other communities experienced during the housing boom, once prices started dropping, home ownership became really cheap.
In Minneapolis, the average listing price for a home placed on the real estate market is $153,844. A 30-year fixed rate mortgage for that amount locked in at the rate of 4.638% APR would result in a monthly payment of approximately $768. The average monthly price for renting a home in Minneapolis is $1,700. Other cities where it is cheaper to buy than rent include Miami, Fresno, Phoenix, El Paso, and Las Vegas.
Curiously, Minneapolis is the only northern city which landed on this list, while quite a few landed on the list where it's much cheaper to rent than buy. Cities where it is cheaper to rent include Portland, Seattle, Omaha, Cleveland, and New York.
Ultimately, the decision to buy or rent is up to an individual or family's financial situation. Though homeownership enables people to build equity over the long term, the costs of paying for a home go beyond the monthly mortgage payment. Though no equity is built by renting, sometimes personal lifestyles may make renting a better choice.
Considering buying a first home? Contact the Twin Cities Realtors at Barker & Hedges o see how they can help you determine if buying a home is the right step for you!
Minneapolis Mayor R.T. Rybak and St. Paul Mayor Chris Coleman have jointly announced that $41 million in new funding has been pumped into the CityLiving Program. CityLiving assists first time homebuyers with purchasing homes in either city.
The CityLiving Program offers below-market interest rates on mortgages in addition to help with down payments and closing-costs. Hmebuyers’ household income cannot exceed $92,290 and the purchase price for a single-family home can’t be greater than $276,870 in order to quality for the funding.
“More people owning homes in Minneapolis and Saint Paul means more prosperity, more civic engagement and more vitality in our Minnesota’s core cities — and that’s good for everyone,” said Minneapolis Mayor R.T. Rybak in a statement. “For nearly 30 years, Minneapolis and Saint Paul have worked together through the CityLiving program to help 30,000 first-time homebuyers enjoy the benefits of city life.”
In addition to the $41 million, each city has $500,000 available for assistance with down payments and closing costs.
The CityLiving program is funded through bonds sold by the cities. Though the CityLiving initiative has been around for 30 years, it was not available last year because the credit crunch prevented the cities from selling the necessary bonds.
Read more about the CityLiving Program in Minneapolis and CityLiving Program in Saint Paul.
Looking through some older posts on this blog, I thought it might be time to highlight some oldies-but-goodies. There is still some great information in these posts, even if they are a few years old.
Lately, we've been talking a lot about buying homes, but haven't talked much about choosing which home to buy. Well here are two posts from this blog's first few months which may be able to help. One of the first decisions you make when you begin to look for a home is whether to buy new or purchase an existing house. There are advantages and disantanges to each.
First, read Ten Reasons to Buy a New Home. Then read Ten Reasons to Buy an Existing Home. Between the two articles, they have a lot of information. They should help buyers to determine which type of housing is best for them.
Be sure to tune in regularly for home buying and selling news, trends, and tips.