At the beginning of the year, we predicted that the Twin Cities real estate market would continue to improve throughout the year, and we’re seeing this improvement in real time with many of our sellers getting multiple offers on their homes within just a few days on the market.
What is a seller’s market, and how does it affect you as a seller or buyer? With the Twin Cities market currently in a strong seller’s market, it’s crucial you know exactly what it means for you. There are a few signs that a given market favors sellers:
Diminished inventoryof homes for sale in the area.
Today, we'll discuss the current state of the Twin Cities real estate market. It is important to have historical context when talking about current real estate trends so that you can understand exactly what is happening in the market.
For instance, we consider it to be a balanced market when we have somewhere between 21,000 and 23,000 listings on the market. Right now, we have 17,000 listings. We all remember the market crash. At the peak of the market, we had 35,000 listings. As you can see, we are significantly down from the peak, and we're below the balanced market rate. Right now, with our low inventory, sellers do have the upper hand.
Now, let's look at pricing. January 2012 was the bottom of the market with a median sales price of $140,000....
Posted by Brandon Hedges on Tuesday, March 25, 2014 at 10:58 AMBy Brandon Hedges / March 25, 2014Comment
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Posted by Brandon Hedges on Wednesday, February 12, 2014 at 11:44 AMBy Brandon Hedges / February 12, 2014Comment
As we emerge from the seemingly never ending polar vortex, the real estate market is beginning to show signs of life. The most recent market stats continue to favor home sellers with lower inventory and higher median sale prices. Here is a breakdown of the year over year stats for a few key categories:
New Listings: DOWN 16.9% over last year.
Homes for Sale (inventory): DOWN 9.1% over last year.
Median Sale Price: UP 12.4% over last year.
To give a little more context to this information, there are just under 12,000 homes for sale in the Twin Cities right now and last year at this time there were just over 13,000 home listings and those following the real estate industry were noting at that time that the overall listing inventory was exceptionally low...and now it is even lower. The lack of available homes is causing median and average sale prices to increase. If you would like more information about the market stats in your area, please visit our Twin Cities Market Statistics page for additional information that is updated daily.
Posted by Matt Barker on Tuesday, August 13, 2013 at 12:31 AMBy Matt Barker / August 13, 2013Comment
If you’ve been paying attention to the news coming out of Washington lately, you may have heard that Congress plans to shut down Fannie Mae and Freddie Mac. The plans would phase out the government-controlled mortgage guarantee giants over the course of five years.
The push to dismantle Fannie and Freddie is a result of the housing crisis the country has experienced. Freddie and Fannie teetered under a crush of massive losses on risky mortgages before being bailed out to the tune of $187 billion, about 2/3 of which has already been paid back to the government.
The House Republican bill would practically entirely privatize the mortgage market, andd limit the Federal Housing Administration to insuring loans only for first time home buyers and lower-income borrowers. The Senate's bipartisan plan includes a new agency that has a continued, but more limited, government role in insuring a wider range of mortgage securities. The idea behind both of these plans is to shift more mortgage financing risk from to the private sector to prevent taxpayers paying for future bailouts.
But there's a price homebuyers would likely pay for having private investors shoulder more risk to protect taxpayers.
"It will mean higher mortgage rates," said Mark Zandi, chief economist at Moody's Analytics. "The question is how much higher."
Typical borrowers could pay about $75 per month in extra interest payments, about half a percentage point, on an average mortgage under the Senate proposal, Zandi estimated, and about $135 more under the House plan. That's on a conforming...
Posted by Matt Barker on Wednesday, July 24, 2013 at 8:29 PMBy Matt Barker / July 24, 2013Comment
As consumer confidence and incomes rise, home building activity in the Twin Cities metro area continues to rebound. According to the Builders Association of the Twin Cities (BATC), housing construction so far this year is up 23 percent from the same period in 2012, putting builders on a track for their best year since 2007.
During June alone, 496 permits were issued to build 912 units. Minneapolis led the top five cities permitting 380 units. Brooklyn Park and Woodbury were in the second position with 31 units, followed by Ramsey with 29. Construction of new homes in Blaine MN, Chanhassen MN and Lakeville MN tied for fifth place with 23 units permitted each.
So far this year, builders were issued 2,379 permits to build 4,204 units, a dramatic change from this time four years ago when there were only 1,633 units.
In the south metro, Lakeville continues as the busiest homebuilding market in Dakota County and one of the metro area’s most active. The city has recorded 172 permits since the beginning of the year through the end of June, up from 107 for the same period a year ago.
In the north metro, Blaine is closing in on Coon Rapids for the title of largest city in Anoka County. It was the ...
Posted by Matt Barker on Tuesday, April 30, 2013 at 12:47 AMBy Matt Barker / April 30, 20131 Comment
The Twin Cities real estate market is heating up and sellers are winning the season so far. Inventory is getting a bit tight, resulting in higher sale prices and even multiple bids.
The jackpot is a little unecpted and too soon for some home sellers, though. There are stories of home sellers putting houses on the market and having offers withint days. When they accept so soon, a whole new flood of concerns is coming forward: What to do between houses - after one has sold, but before the new home has been bought?
This concern may be causing some sellers to hold back. Home sellers don't just want to unload a house and be homeless for a while, they want to have a prospective house that they want to buy in mind before putting their house on the market.
But that's not the only option. Our own Matt Barker was interviewed by the Pioneer Press on this very subject:
"Unless they're willing to take the risk of owning two properties at once, we're preparing the majority of sellers for
short-term rentals," and encouraging them to be patient for the right
house to come along, [Re/Max Results Realtor Matt] Barker said.
Once sellers are ready with their game plan, whether they have a new home in mind or are going to rent, and they are finally prepared to put their home on the market, there are some things they can do to encourage ...
Posted by Matt Barker on Thursday, December 01, 2011 at 8:27 AMBy Matt Barker / December 1, 2011Comment
Local and national housing statistics indicate that the real estate markets in the Twin Cities and surrounding areas are still struggling. Here are brief summaries of three recently released Twin Cities real estate reports:
The Case-Shiller Home Price Index, which follows repeat sales of properties, indicated that during September, prices in the Minneapolis - St. Paul metro area were down 7.4% compared with 2010 and down just 0.9% from August.
A report from the Builders Association of the Twin Cities showed that Twin Cities home builders requested about the same number of permits in November of this year as they did in 2010. However, the number of units they planned to build decreased from 685 to 442. Construction activity for the year overall is down compared with last year, but improved form 2009.
A third quarter report from Corelogic said that 17.5% of all residential properties in the Twin Cities metro with a mortgage were worth less than the amount owed on the mortgage, compared with 17.4% during the second quarter. That percentage is better than the national figure of of 22.5% of homes. It could be a lot worse. In Nevada, 58% of all mortgaged properties were upside-down.
Finally, decreasing home prices have attracted some buyers into the Twin Cities real estate market, but kept sellers out. According to October sales figures from the ...
Posted by Matt Barker on Tuesday, July 19, 2011 at 12:52 AMBy Matt Barker / July 19, 20111 Comment
Pending home sales initiated in June within the Twin Cities area were among the highest in nearly five years. Buyers may be taking advantage of low prices and near-record low mortgage interest rates before they start to climb.
The Minneapolis Area Association of Realtors reports that though there are some good signs occurring in the local Twin Cities residential real estate market, there's still a ways to go. Though pending sales rose in June, closed sales fell 11.4% compared with a year ago. The median sale prices fell 9.3% from a year ago to $165,000. That is still better than March's low of $140,000.
It's unclear whether the latest uptick in buying activity is a blip or a sign of a sustained recovery, given an economy still struggling to gain traction and the extent of the foreclosure crisis still unknown. Stable employment, strong rent prices and relatively low foreclosure rates suggest that the market has seen the worst, said Herb Tousley, director of the Shenehon Center for Real Estate at the University of Minnesota.
"I believe there is reason for optimism," he said.
The biggest barrier to a recovery is foreclosures. At its worst, nearly 60% of all residential real estate sales in the Twin Cities metro were distressed sales, but it has fallen to 38% last month - the lowest level since June 2010! Additionally, fewer foreclosures are entering the market, with the 29% of new listings in the Twin Cities during June that were either foreclosures or short sales being one of the lowest monthly totals in three years.