The Minneapolis Area Association of Realtors just published data showing the lowest level of foreclosures and short sales in the Twin Cities since 2007. This is certainly good news for home sellers as the pricing pressure has been relieved. In some ways it’s good for buyers too although they will be paying higher prices. Why might it be good for buyers? While buyers might always be worried about losing money, with an improving marketing and lower inventory of short sales and foreclosures, that worry is not as big as it once was not that many years ago.
If you have not discovered this tool yet offered by the Minneapolis Area Association of Realtors and powered by 10K Research, it’s a must if you want to stay on top of the statistics for your particular city. The reports are generated every month usually around the 10th or so of each month.
The Minneapolis Area Local Market Updates for over 200 communities. You’ll find:
- Median home sales prices
- Average home sales prices
- New listings
- Number of closed sales
- Days on market until sale
- Final sales price as a percentage of original list price
Where are home prices headed? Fiserv Case-Shiller has come out with a housing market forecast for the next two year for 20 major metropolitan areas in the U.S. The forecast period is for March 2011-March 2012 and then March 2011 – March 2013. Some markets are still expecting big drops in home prices such as Miami, but other are forecasted to see significant price appreciation including San Francisco +8.7%, Las Vegas +8.10% and Portland +8.8%.
Locally, the Minneapolis market is forecasted to remain flat with a -.7% price depreciation.Home prices in 20 major cities. Some cities are expected to bounce back faster than others. Here’s how home prices are faring in some of the nation’s major markets — and where Fiserve Case-Shiller expects them to head in the upcoming year.
Table below is from CNN Money. The source for the data is Fiserv Case-Shiller.
|City ▾||Prices March, 2011 – March, 2012||Forecast March, 2012 – March, 2014|
|Index of 20 cities||-0.80%||1.70%|
In the Twin Cities we have been seeing signs of dwindling housing inventory for a year now. In most micro markets, inventory is down 20-30%. As that continues, it will inevitably put pressure on pricing. I don’t think anyone’s expecting a sharp rise in home prices, but it certainly will help the situation as it should minimize the price declines that we have gotten used to over the past 5-6 years.
Craig Kamman has a very good synopsis of some recent reports on inventory and home prices. There does seem to be some hope that prices might be up by 5-10% over the next 24 months. Every market is different of course.
This isn’t a pretty way to start out a Saturday morning, but I had to do some analysis on St. Louis Park, MN and I thought I’d share the very graphic destruction in home price values in “The Park.”
Median home prices peaked at around $235,000 in St. Louis Park during the top of the market and they are now around $182,500. That’s a decline of 22.3% in home values during the past 4-5 years.
- Orono, MN Median Home Prices Decline From $800,000 to $525,000 (johnmurphyreports.com)
- Understanding Agency (Who Represents Whom in a Real Estate Transaction) it’s Important, Overlooked and Misunderstood (iloanminnesota.com)
- The New Agency Laws in Real Estate – Understanding Dual Agency as a Home Buyer or Home Seller (johnmurphyreports.com)