October notes.

The market seems to be easing for sellers a bit! The Minneapolis Area Association of Realtors, in its October 8, 2011 weekly report, states ” It seems like every passing week brings not one but two new record declines: inventory levels and mortgage rates. The number of active listings on the market fell 21% to 22,434 units and mortgage rates fell below 4% for the first time ever. Pending sales were up 48.3% over the same week in 2010 to 851 purchase agreements signed.”

So, it appears even without any government stimulus, the Twin Cities housing market continues to small strides toward recovery. Sellers listed 5,562 new homes on the market, down 16.8% from September 2010. buyers entered into 3,752 purchase agreements, up 37.4% over September 2010 levels. That’s the fifth consecutive month of double digit, year over year gains in buyer demand! The decline in activ listings marks the largest inventory decline in more than seven years! The leaner inventory count combined with stronger purchase demand has moved the market toward balance.

July notes.

The market continues to grow some momentum, yet pricing still is an issue for homes that are selling. The following excerpts recently appeared in various publications suggesting a turning point in the market might be underway:

July 7, 2011 from a USA Today article , “Buffett urges Congress to hike debt ceiling”.
“Berkshire Hathaway’s top executive said he believes the global economy has continued to improve slowly since the fall of 2009 based on reports he receives from all of his Omaha-based company’s subsidiaries. Business has been getting better consistently in nearly every area except construction” Buffett said.
June 30, 2011 article published by CoreLogic.
“Two consecutive months of month-over-month growth continued relative strength in the non-distressed market segment are positive signs in the housing market. Slowly declining shadow inventory and stabilized negative equity levels are also positive signs. Nonetheless, the fragile economic recovery is still critical to the long term recovery in the housing market.”

June 28, 2011 article by RISMEDIA “Experts Agree Prices Have Bottomed Out and Will Stay There”
“A significant majority of the 108 economists and experts participating in Macromarkets’ June price Home Expectations panel believe that the bottom for home prices arrived in the first quarter or will arrive sometime before year end. Despite persistent macroeconomic uncertainty and unprecedented housing market dysfunction, almost two thirds of the panelists see the US residential real estate market as at an historic turning point; however, expectations for the pace of recovery fell. The group of 69 panelists who are currently forecasting a 2011 turning point predict less than two percent average annual growth in normal home prices over the five year period ending December 2015.”

July 11, 2011 article from Time MoneyLand “Why Real Estate May be the Buying Opportunity of the Decade”
“No one knows what the economy or the stock market will do over the next six months. Right now, all the trends are lining up to make real estate a fantastic long term buy.”
“Falling home prices plus the foreclosure backlog probably mean a flat to down market over the next couple of years. But beyond the current desolation, the outlook is exactly the opposite. The economy has grown for seven straight quarters and once the economy recovers, the factors that drive housing demand will follow. Once the bottom is reached in prices, the market will improve. The next two or three years should offer exceptional opportunities for buying actual real estate- both primary residences and vacation homes.”

June notes.

On June 4th, the Wall Street Journal published an article titled “Why It’s Time to Buy”. The article mentions growing indications that it is indeed a good time to buy. “Mortgage rates, which fell to 4.55% for the week ending June 2 are near 50 year lows. Homes have become more affordable than they have in years and a historic glut of homes listed has created a buyer’s market”. The WSJ suggests the conditions might not last long.
Moody’s Analytics predicts that the number of distressed sales will begin to fall in 2013, and then prices will begin to edge upward. Demographic indicators such as “household formation” – the number of new households each year – are on the rise. As a result, “While we might not see rapid growth in the next couple of years, there are a tremendous number of positive signs that could lead to a rebound,” says Anthony Sanders, a real estate finance professor at George mason University.
While overall home prices fell by 7.5% in April over the same period a year earlier, according to CoreLogic a Santa Ana, California provider of real estate data and analytics, if you exclude distressed sales, prices were off just 0.5%. So, the WSJ feesl if you are in a market that hasn’t been battered by foreclosures, you may be close to a bottom already.
Affordability is a key indicator and, although renting is still cheaper than buying in some markets, rising rents and falling home prices has changed that dynamic. Buying a home is already cheaper than renting in Chicago, Cleveland, Detroit and Orlando, Florida. Other markets are soon to change as well in Dallas, Las Vegas and Sacramento, California if trends continue.

May notes.

This might be the best time ever to purchase a home. In my 32 years as a Realtor, I have never seen the combination of such low interest rates combined with low housing prices. Any buyer now will get a good buy on a home! We don’t know how long this will sustain, but it’s a great time to be looking to buy a home.

CNN Money.com claimed on May 19, 2011 that the mortgage delinquency market is getting brighter. A quarterly release by the Mortgage Banker’s Association revealed that mortgage payment problems eased during the first three months of 2011 for every category of default. The rate of loans past due decreased 1.17% from the last quarter of 2010. “These numbers point to a mortgage market on the mend” said Jay Brinkmann, MBA’S chief economist. He also feels that many of the worst loans have been purged from the market through foreclosure. This, combined with much stricter underwriting standards for newer mortgages, has improved overall credit quality.

Real Estate Blog

January 2018

The 2018 market is off and running. Listing inventory is low, interest rates are still affordable and buyers are desperate for homes to see. If you are considering a move, give us a call. With the resources and networking at Edina Realty, we can help you sell your home and find your new home.

April notes.

Yes – we finally might have seen the last snow for now! The market has been tied to the weather – slow to get started but gaining momentum. Homes are selling and even in multiple offers if they are priced well. In fact, homes that are carefully priced are selling within 10 days of their list date. Overpriced homes are taking longer. Several $1 million|+ priced homes have recently sold in Edina which means the upper bracket is starting to sell as well.

Shawn Tully, senior editor at large at Fortune magazine, has written a recent article entitled “Real Estate: It’s Time to Buy Again.” His point is that, after four years of plunging home prices, the most attractive asset in America is housing. He believes that there are two basic factors laying the foundation for the housing recovery: The first is the historic drop in new construction and the second is a steep decline in prices. A new affordability index has been determined and more Americans can afford to buy a home now because of low prices. Before ths shappens, America will need a decent economy according to Tully. He sees the market returning to levels seen 10 years ago. Mark Zandi, chief economist for Moody’s Analytics, says “the credit standards are now at about historic levels…” which will lead to prices rising and buyers purchasing homes again. Also helping is the brighter outlook for areas hit hardest by the foreclosure market – the sun belt areas of Florida, Nevada, Arizona and California. People will always want to live in those areas for the warm weather, so there is optimism for those markets as well. Time will tell.

March notes.

As reported in Bloomberg Business Week on March 1, billionaire Warren Buffett claims buying a home was the third best investment he ever made after marrying his two wives. “For the $31,500 I paid for out house, my family and I gained 52 years of terrific memories with more to come.” Buffett, the world’s third richest man, still lives in the home he bought in Omaha, Nebraska more than five decades ago. He continues with “A housing recovery will begin within a year or so – it is certain.”

February notes.

January 2011 pending sales data is out from the Minneapolis Area Association  of Realtors and sales increased 3.7% from January 2010. This is the first ever year over year increse since the tax credit days of April 2010. Although pending sales increased, the median sales price fell 10.8% to $140,000 in the Twin Cities. A larger share of homes sold in January were short sales or foreclosures compared to last year and that explains part of the decline. Traditional, non distressed sales actually increased 1.9% from a year ago to $201,500. The average days on the market until sold increased 9.4% to 146 days; affordability, however, is soaring as interest rates remain low. The Housing Affordability Index for January 2011 is 241, which is a new record and indicates extremely favorable conditions for buyers.

It was announced on February 4, 2011 that FHA has extended its waiver for buyers to be able to use an FHA insured mortgage to purchase a home within 90 days of it previously being purchased, rehabbed and then re-sold. Previously, FHA had denied financing to any home that was “flipped” or bought, rehabbed and re-sold within 90 days. This announcement means buyers will be able to use FHA financing to purchase those homes within the old 90 days period and this waiver shall remain in effect thru December 31, 2011. This is good news for 1st time home buyers looking to buy a home that might have been recently rehabilitated. FHA is often the only low down payment method of buying a home so this will allow those buyers to now purchase a home that was formerly prohibited from FHA financing. David Stevens, Commissioner of the FHA, was quoted as saying “Because of past restrictions, FHA borrowers have been often shut out from buying affordable properties. This action enables our borrowers, especially first time buyers, to take advantage of this opportunity and buy a home that has been recently rehabilitated. It will also help move foreclosed properties off the market and reduce the number of vacant homes in neighborhoods throughout the country.”

The 2010 Minneapolis Area Association of Realtors has just released its Annual Report for the 2010 real estate market. One chart they include is called “Historical Price by Area” and it charts the annual pricing averages across the Twin Cities since 2006. It also compares the difference from 2008 to 2009 and the % change up or down in average price. Some examples include:

Area 2008 avg price | 2009 avg price | % difference
Edina: $325,000 | $339,000 | +3.1%
West Bloomington: $210,000 | $206,950 | -1.5%
Eden Prairie:  $251,125 | $265,000 | +5.5%
SW Minneapolis: $260,000 | $275,000 | +5.8%
St. Louis Park: $212,500 | $213,703 | +0.6%
Minnetonka: $241,250 | $265,000 | +9.8%
Hopkins: $164,900 | $150,350 | -8.8%
Lake Minnetonka: $339,500 | $350,000 | +3.1%
Richfield:  $165,000 | $160,000 | -3.0%
Plymouth: $253,500 | $249,000 | -1.8%
Maple Grove/Osseo: $219,348 | $250,000 | +14%

Click here to see the full report.

Some thoughts for January 2011.

Statistics are out from the Regional Multiple Listing Service for 2010. The southwest suburbs and southwest Minneapolis stats can be found on our website under blog/market statistics, but here are several areas that might be of interest. Edina’s average sales price went up just under 2% in 2010 but the average days on the market increased 10%. Less than 1/2 the homes listed in 2010 in Edina actually sold. Eden Prairie’s appreciation was a bit more but its days on the market decreased by 15 days on average. Southwest Minneapolis average price increased by $36,000 and its days on the market increased by 13 days. West Bloomington stayed virtually the same in sales price and days on the market.

Did you know more young adults are living at home? According to National Association of Realtor statistics, there were 70 million young adults aged 18 to 34 living in the US and the number of adults under the age living at home in the highest level since 1981! The number is over 30% compared to a historical average of 28%.

Forbes Magazine recently ranked Minneapolis-St Paul as the fourth best job market in the United States. Job growth is expected in manufacturing and professional services like accounting. The Mall of America is also expanding and that will contribute to job growth in the region. Forbes reported that there are roughly 3 job seekers per advertised opening in the Twin Cities and the area’s unemployment rate is 6.5% compared to the national average of 9.4%.

Edina Realty proudly announced on January 19, 2011 that it led the market in Twin Cities real estate companies in sales in 2010 for the 11th year in a row. Edina Realty actually gained1% in market share over its nearest competitors in a difficult market. Edina Realty represented 21.53% of all sales in the Twin Cities in 2011 and it continues its trend of increased market share.

On January 27, 2011 Ron Peltier, chairman and CEO of Homeservices, Edina Realty’s parent company, spoke about the current real estate market on Fox News. Pending home sales were up 2% in December 2010 vs. November 2010 and this was significant in the fact that December is typically a quieter sales month. Peltier felt however, that this indicated a stabilization in the housing market as 2011 emerges. “It’s a great time to buy a home” he said. “Home prices are at 2002 levels, there is alot of inventory and interest rates are still under 5%, so it’s a great time for buyers to be looking.” As interest rates start to move ever so slightly upward and consumer confidence returns, the real estate market should stabilize and improve during 2011 and into 2012.

Happy New Year!

Wishing you a Happy New Year! We hope 2011 treats you well.

If you are considering buying or selling a home this year, give us a call! We’d love to help.

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Meg & Tom Bring Home Results!

We specialize in the south and west suburbs of the Twin Cities including southwest Minneapolis, Edina, Bloomington, Eden Prairie, St. Louis Park and Minnetonka. We have been the top producing agents in Bloomington and are also corporate relocation specialists trained in the special details of family relocation. We also deal with short sales, foreclosures and any other bank owned properties. Our web site shows active listings as well as sold properties.