Existing Home Sales Jump to 1 1/2 Year High

The existing home sales report just came out from the National Association of Realtors for January 2012.  It shows that homes sales continue to pick up and the supply of homes for sale continues to decline.

Housing to Boost GDP, First Time in Years According to Fannie Mae

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Fannie Mae economists are out with their forecasts for 2012 and they expect the housing market to have a modest, positive impact in the overall GDP numbers in 2012.  This is the first time in years that housing will be a net plus to the GDP rather than the net negative drain it as been for the past few years.

Fannie Mae says, “economic indicators suggest a pickup in construction of apartment buildings and a modest uptick in single-family construction. Still, there are challenges that could emerge derailing 2012 growth projections.”

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National Survey Reveals New Normal – Consumer Expectations on Homeownership

American FamilyThis is an excellent detailed analysis of the state of the housing consumer when it comes to real estate and homeownership issues.  For those who like to study this kind of material, this is well worth your read.  For those of you who are investors, or thinking about becoming an investor, it certainly appears that there will be plenty of supply of tenants for the foreseeable future.  It’s been my belief since we housing crash which began in 2007 and then soon followed by the financial crash in 2008 that those events were so massive that they may have permanently changed the psyche of the country when it comes to home ownership.  That said, do I think we are headed to a 50% ownership society and 50% rentals?  No.  But we won’t ever see the 70% ownership numbers again in my lifetime and I would expect we’ll just continue to drift closer to 60/40.  While those numbers don’t look huge, they are indeed transformational for the industry, American society and culture.

New Custom HomeBig Builder is the industry news source for large national home builders.  The study is called, “Housing 360: Insights into Homeownership” where they surveyed 3,000 people and conducted six focus groups. They need to stay on top of the multi-billion dollar new home business and it’s very interesting to read their analysis and insight regarding today’s home consumer and what they are thinking. Apparently many are in the same boat as one gentleman was quoted as saying, “If I could get a full-time job with a decent salary, I’d buy a house.”

Some key highlights of the Housing 360 report:

  • 7 out of 10 think now is a good time to buy a home
  • Many who bought homes during the boom wish they hadn’t – (perhaps a little buyer’s remorse?)
  • 25% of survey respondents are underwater on their homes
  • 72% still believe it’s important to own their own home
  • 67% say that their current home is fine – general across the board apathy among potential home buyers
  • 47% are concerned that if they did sell in order to go buy a new home, would they get a fair price for their current home?
  • Of those surveyed who are renters, only 25% said their current home is fine, however, 45% of the renters said there is no urgency to move
  • Concerns are high about down payment expectations and whether or not they will even qualify for a mortgage

This is by far the most informative article I have read about the current state of potential home buyers and sellers.  The National Association of REALTORS publishes a report each year, but all too often that just seems to come off as too self serving.  This, on the other hand, is very insightful.  I highly recommend you read the article and for those who want the actual research report, please see Hanley Wood Housing 360: Insights into Homeownership.

On a more local note, while this report details what the home builders must do to attract new construction home buyers, clearly the home builders operating in Plymouth, Maple Grove, and Medina Minnesota are doing an outstanding job given the recent explosion in construction and sales activity. To stay on top of what’s happening locally in the northwestern suburbs of Minneapolis, be sure to check out Northwest Plymouth where I continue to chronicle the rebirth of the Twin Cities home construction market.

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Centennial Lakes Park and Ice Skating – Edina, MN

A couple of weeks ago, one of my daughters had the opportunity to attend a birthday party at the Centennial Lakes Ice Rink.  It’s one of the more stunning ice rinks in the area as it’s sandwiched in between some large Class A office towers in Edina, MN.  If you ever get a chance to go, they have a terrific warming house as well.

Centennial Lakes Park MonumentCentennial Lakes Ice Skating Rink Edina MN

For more information, check out the official site to Centennial Lakes Park in Edina, MN.

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Mortgage Backed Securities (MBS) Back in Vogue with Investors – New York Times

Wall Street investors are betting that the worst is either behind us in the U.S. housing market or the downsize risk is at least accounted for and discounted with the cheap price of MBS today according to the New York Times.

If you recall Mortgage Backed Securities were all the rage in the investment community leading up to the housing crash.  They were then shed like the plagued and the Federal Reserve has been one of the only significant buyers of MBS in the past couple of years.  Now prices are up 15% and appear like they will continue to rise.  I suspect they’ll continue to climb for the next couple of years as the housing market goes in to full recovery mode and the Federal Reserve can start to unload the approximate $1-$2 Trillion it holds in MBS.

The money interests are now betting that we’ve seen a turn in the housing market.  Please don’t be confused with higher home prices.  I think we’ll continue to see overall home price declines in 2012.  It’s been my sense that we’ll start to see a consistent rise in home prices by the spring of 2013 but by then investments in housing will be significantly higher once the printed numbers show house price appreciation.

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Spring Meadows – Custom Homes in Northwest Plymouth – Photo Gallery

The housing boom continues apace in northwest Plymouth, MN.  Spring Meadows is a beautiful neighborhood located in the Wayzata School District.  It’s just to the west of Vicksburg Lane south of County Road 47 and north of Schmidt Lake Road.  The neighborhood is within 5 minutes of both Wayzata High School, Providence Academy and Heritage Christian Academy.  Check out the photos of Spring Meadows that I took in mid February 2012 of the ongoing growth of this neighborhood.

If you’re interested in new construction in Plymouth, MN be sure to request the free report – Plymouth MN New Construction Report.

Spring Meadows Monument NW Plymouth MN

Spring Meadows Monument NW Plymouth MN

Minneapolis Area MLS Membership Drops from 21,000 to 13,000 During Housing Market Crash

Just a quick note to say I heard this in a training session the other day.  Unfortunately, no one publishes accurate details as to exactly how many real estate agents are out there in the Twin Cities marketplace.  There are more real estate sales people who are licensed but they are not REALTORS.  To be a REALTOR, you must join one of the boards and pay your MLS dues.  It appears that as the housing market crashed, those willing to pay their dues membership to be REALTORS with access to the MLS crashed as well.

FHA Foreclosures Reach Four Year Low – Delinquencies Rise

FHA foreclosures are falling rapidly.  By foreclosures I mean they’ve already gone back to the government.  These are HUD homes which you can find at the HUD Home Store…it’s kind of like a thrift store for housing.

While the REO inventory is down there appear to be plenty of addition properties that are making their way through the pipeline and are in some stage of foreclosure.

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January 2012 Pending Home Sales Highest Since 2005

NEWS RELEASE
FOR IMMEDIATE RELEASEGreg Sax, Communications Manager
Minneapolis Area Association of REALTORS®
952.988.3123 (office)
612.860.2668 (cell)
gregs@mplsrealtor.com

David Arbit, Market Analyst
Minneapolis Area Association of REALTORS®
952.988.3150 (office)
davida@mplsrealtor.com

January Pending Home Sales Highest Since 2005

Minneapolis, Minnesota (Febuary 10, 2012) – There were 3,149 purchase agreements signed in the 13-county Twin Cities metropolitan area during January, a 25.5 percent increase over last January. No doubt driven by a mix of record-low mortgage rates, affordable prices, strong negotiating leverage and unseasonably warm weather, that’s the highest January pending sales figure since 2005.

Sellers were less active, as new listings fell 9.0 percent from January 2011 to 5,112 properties. The number of homes for sale continued to drop, as well, down 28.1 percent from last year to 16,463 active listings – the lowest inventory reading for any month since 2003. Another important housing metric, months supply of inventory, remained at a six-year low of 4.6 months.

October Homes for Sale“If you look deeper into the strong sales figures, you can see which segments are leading the charge,” said Cari Linn, President of the Minneapolis Area Association of REALTORS®. “With inventory down, especially among foreclosures, and good purchase demand, buyers are finally looking harder at traditional properties.”

Traditional sales surged 28.7 percent, while foreclosure sales fell 2.9 percent and short sales increased 16.8 percent. For sellers, the landscape is shifting. For six consecutive months, sellers received progressively more of their asking price than they did the year prior. In January, sellers received an average of 91.2 percent of their original list price.

Sellers are also watching market times closely. The average number of days a listing spends on the market before closing was down 8.3 percent to 142 days—the fourth consecutive year-over-year decrease. But those looking to sell their properties should be aware of distressed market activity.

In January, 43.2 percent of all new listings were either foreclosure or short sales. Together these lender-mediated properties made up 55.3 percent of all closings. Homes in financial distress are exiting the marketplace faster than they are entering it, but they have still managed to prevent market-wide price appreciation. The median sales price was down a modest 3.4 percent from January 2011 to $140,000, marking the smallest decline since November 2010.

“Price declines are subsiding, partly thanks to changes on the supply-side of the equation. Rising home prices will still be the final phase of recovery,” said Andy Fazendin, MAAR President-Elect. “We firmly believe that what we’re seeing now is setting the stage for better times ahead.”

All information is according to the Minneapolis Area Association of REALTORS® (MAAR) based on data from the Regional Multiple Listing Service of Minnesota, Inc. MAAR is the leading regional advocate and provider of information services and research on the real estate industry for brokers, real estate professionals and the public. MAAR serves the Twin Cities 13-county metro area and western Wisconsin.

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14 Reasons Why Property Taxes Vary

Perhaps the tax accessors and other government officials in Hennepin County and specifically Orono, MN are getting some flack over property values and the corresponding property taxes.  The City of Orono has as the second link front and center on their home page, “14 Reasons Why Property Taxes Vary” by the Association of Minnesota Counties.  It was originally produced in 2006 just as the housing market was peaking.

If you are thinking about challenging your present tax assessed value in 2012, you may want to take some time to read their document so that you will know what the arguments are to possibly keep your tax assessed value at its current number.

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