2008 Market Review

We’ve all read the negative news about the Twin Cities housing market.   Star Tribune reported that Twin Cities’ home prices have dropped accumulatively 16% over the last year. 
 
Many people think that the reason for the price decrease is that there are more homes on the market than ever, and they are just sitting there.  This isn’t true.  There are actually LESS houses on the market than in the past, but the problem is that there are even less buyers . 
 
Another big reason for the average price drop is because there has been  large uptick in the number of lender-mediated homes (which include bank-owned, i.e., foreclosures, and also short sales) .  Of course, this will skew the prices of the average downward.
Looking at the graph above, we can see that the number of sales for homes in the under $150,000 price range more than doubled (128%) while the number of sales for houses in the $190,000 to $350,000 decreased 22%. 
 
These numbers show that much of the decrease in selling price is attributed to the lender-mediated sales and that a house can still sell if priced right.

HPDL Minneapolis Real Estate Market in Review, 2008 Y-T-D

Minneapolis Real Estate Market Update

As you know, the Minneapolis real estate market for 2007 was in flux.  America, as a whole, was experiencing what felt like a recession, even if it didn’t fit the technical definition of the term.  The fundamentals of the economy may or may not have been strong, but the housing market began to slow down. 

What you may not know, however, is that the housing market in the Hale Page Diamond Lake (HPDL) Minneapolis neighborhood experienced a comeback of sorts in 2008, after taking the expected hit in 2007.  Of course, it is November of 2008, so we don’t have data for the full year, but here’s what we know for the first three quarters of 2008. 

The average price of a home sold in the HPDL area rose from $274,000 in January, 2008, to $286,000 in September.  That’s an increase of 4%.  In addition, the average days on market (DOM) decreased from 102 days in January to 94 days in September.  Finally, the percentage of list price to sales price stayed roughly the same throughout the year at 93%.  In other words, on average, people received ninety-three person of what they originally wanted for their homes.

Real Estate Insights

The National Association of Realtors publishes the Real Estate Insights monthly. If you want a copy of the latest issue in pdf format, just drop me an e-mail.

There are some market indicator statistics that are published in this newsletter. A quick glance includes the following:
Existing home inventory is up.
Existing home sales is down 1% from March.
Housing Affordability – falling prices will entice buyers back into the market
Mortgage Rates have climbed to just over 6%.

For your copy, just send me a quick e-mail. Back issues are also available.

How’s THAT going?

When I meet people for the first time, they usually ask THE question when I mention that I’m in real estate. The question: “How’s THAT going?” or “Isn’t that a tough business?” or “Isn’t it hard to sell homes right now?” or somthing else to the effect.  Frankly, the real estate market is not as bad as the press makes it out to be. We’ve seen an up-tick in the amount of house showings, as well as houses that go pending. I got quite a bit of interest for one particular house with the on-line marketing model that I use. In fact, that house sold in 2 weeks. Of course, it was priced right, staged nicely, and showed well.

The market isn’t really that bad right now. It certainly isn’t as robust as previous years, but houses still sell. People still buy. Real estate transactions still take place. Business goes on.

10 Ways to Save Gas

With gas prices here in Minneapolis approaching $4.00 per gallon, we all are thinking of ways to save gas. Whether it is buying a hybrid car, or just driving less, saving gas is not only helping the planet, but also our pocketbooks. In real estate, we drive between many houses whether it is with buyers or whether we are just previewing the neighborhood houses. We all need ways to cut down on consumption.

Here is my top 10 list of ways to save gas:

10. Make sure your tires are not low on air pressure. Low pressure increases the rolling resistance of the tires, which in turn uses more gas.

Read more

Foreclosure Bargains??

Everybody wants a bargain. Everybody knows foreclosures are bargains. Are they? In this article, we’ll take a look at what happens with a foreclosure. Being in the Minneapolis area, this information is more pertinent to the Minneapolis and St. Paul area houses, although it might apply to other areas as well.

But first, here is some background about foreclosures. Read more