The Minneapolis Area Association’s weekly report from March 2, 2009 once again showed that overall pending sales activity continues to track 15-20% higher than compared to last year and listing inventory is down 10% compared to last year.  These are trends we have basically seen in place for the past several months.
The housing market is much like a gigantic ship. It cannot be turned easily but the Twin Cities market has clearly changed for the better. Now that said, prices are likely to continue to decline. I have said for some time that what we want to watch is the overall transaction activity…not pricing. Pricing is a lagging indicator. It’s like the unemployment rate. The economy will turn back up well before the unemployment rate improves. The same thing is true with home prices.
While the Twin Cities housing market has started to improve for the better when looking at the aggregate, that is not the case for specific pricing categories such as those over $500,000. This gets back to my comments a few weeks ago about the coming price compression.
Here is the link to the fully weekly market activity report for the week of March 2, 2009.
Below are the two most important graphs to watch over time. The first is the pending sales trends. As you can see, the difference between 2009 vs. 2008 is quite significant. (Click picture to enlarge in a new window).
Overall listing inventory continues to decline.  (Click on picture to enlarge in a new window).
