Minnesota MLS Market Update
The Weekly Minnesota Real Estate Market Update - June 18th, 2008Sunny weather here in Minneapolis and the Twin Cities area is bring some more "sunny" news to our local real estate market. As we know, real estate in simplest terms, comes down to supply and demand. The past couple of years has seen an overwhelming increase in supply with flattening to decreasing demand. As a result, misery for many who are trying to sell their home. The key word is many...not all.
HOWEVER, as much as anyone in the media may be trying to convince us otherwise, the tide is definitely starting to turn here in the Minneapolis real estate market. This past week, we saw 2,256 new MLS listings come onto the market. This is down 13.9% compared to 2007. As far as newly signed purchase agreements (pending sales), we saw 919 properties go pending. This too was a decrease from 2007, but only by 5.3%. Lastly, there are currently 33,219 properties for sale on the MLS here in the Twin Cities. This is thankfully down 4.9% compared to this exact same time in 2008. When we look at overall housing supply, it would currently take 10.4 months for the current inventory to become pending or sell.
Interest rates continue to remain steady. This week, the average 30 year fixed interest rate is right around 6.5%.
Are we at the "bottom" of the market? Of course no one knows for sure, but based on the activity we are seeing by investors in our market, I really believe we are there or very close. Last night, we had our monthly investment property seminar in Burnsville. The number of attendees was very encouraging. Buyers really seem like they are slowly but surely coming off the fence and looking to get back in the market.
From a listing standpoint, our team is still finding MLS listings selling that are priced to move. The overpriced homes in the Twin Cities are sitting and sitting on the market. For some of these sellers, we have found a great alternative by encouraging them to look at renting out their property. This allows them to weather this slower listing market and sell when the market rebounds. With our weekly radio show, we work with two great partners, Nina Haugen of NTH Enterprises and Steve Rajavuori of REI Property Management.
As a team, we currently are carrying 168 listings, down a bit from the previous week.
One other item I wanted to briefly discuss in this week's market update blog entry: Auctions here in Minnesota.
Agents on our team have had a number of buyers attend these events. Prices seem to be unbelievable, and the opportunities vast. However, when the smoke clears, it usually is not as appealing as it seems. For example, one of the agents on our team had a client who thought he had bought a property at a recent auction that was here in Minneapolis. Yesterday, they found out that this home was just listed by a local REO listing agent in our market at about $25,000 higher in price they what they supposedly "got" the home for. Apparently the buyer had not hit the "reserve" that the bank was looking for.
Our team has found bank owned homes in Minneapolis, St Paul, really anywhere in the Twin Cities, get listed on the MLS. I personally am not a fan of these auctions at all, for exactly the reasons I described above
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