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Traditional Sales Dominating the Housing Market

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Home sales in the 13-county Minneapolis–St. Paul metropolitan area have appeared lackluster of late on the surface, but if you turn the dirt, you’ll see more intriguing colors in the flowering market mix. Overall closed sales were down 11.9 percent to 3,806 for April 2014, but traditional sales were actually up 1.4 percent. The total was brought down by a 41.8% decline in foreclosure sales and 40.8% decrease in short sales.

Increased seller activity is critical to replenishing inventories. New listings rose 10.2 percent to 7,776 newly listed homes, a welcome sign for prospective buyers. Inventory levels are still constrained, but consumers should have more options to choose from this year than last year.

With higher prices and more buyers on the prowl, more sellers are able to go the traditional route. Traditional new listings rose 25.7 percent compared to last year at this time, while foreclosure and short sale new listings fell 41.6 percent and 49.6 percent, respectively.

On the demand side, pending sales declined 3.9 percent to 5,127 properties overall, once again reflecting less distressed market activity. Traditional pending sales were up 8.2 percent while pending foreclosure and short sales fell 40.4 and 35.1 percent, respectively. The inventory of homes for sale in the Twin Cities is now at 14,429 properties, 1.5 percent more than last year at this time, marking the first year-over-year increase since October 2013 and the largest increase since January 2011.

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“We’re seeing the return of a real estate market led by traditional listings and sales,” said Emily Green, President of the Minneapolis Area Association of REALTORS® (MAAR). “Coupled with more inventory – attractive inventory – it’s setting up to be an exciting year for buyers and sellers.”

As a result of the ongoing shift in the types of homes being sold, the median sales price for the metro rose 8.0 percent to $197,000. That’s 26 straight months of year-over-year price gains. Foreclosures and short sales now make up just 11.4 percent of all new listings. Last April, they made up 22.4 percent. For closed sales, the number fell from 31.3 to 20.9 percent.

On average, homes spent 89 days on the market, down 8.2 percent from last April. Sellers are receiving an average of 95.9 percent of their original list price. The Twin Cities now has 3.4 months’ supply of inventory, the same mark that it was last April.

“Distressed inventory has made up the majority of the lower price ranges, and that market is evaporating,” said Mike Hoffman, MAAR President-Elect. “We can anticipate more negotiations and transactions with people rather than banks.”

All information is according to the Minneapolis Area Association of REALTORS® (MAAR) based on data from NorthstarMLS. 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. 10K Research and Marketing, LLC is a wholly owned subsidiary of MAAR.

Weekly Market Report

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There have already been a few items to watch in the burgeoning spring market, particularly around price, sales and inventory. Median sales prices are on the rise while sales have been a wee bit stubborn emerging from winter hibernation. Meanwhile, more choices are still needed for eager buyers. There’s still plenty of time for the market to catch fire, and there’s no reason to believe that it won’t.

In the Twin Cities region, for the week ending April 26:

  • New Listings increased 25.6% to 1,906
  • Pending Sales decreased 2.4% to 1,212
  • Inventory increased 0.5% to 14,318

For the month of March:

  • Median Sales Price increased 7.6% to $189,950
  • Days on Market decreased 12.0% to 95
  • Percent of Original List Price Received remained flat at 95.0
  • Months Supply of Inventory decreased 3.0% to 3.2

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

April Monthly Skinny Video

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Where has the Twin Cities real estate market been and where is it heading? This monthly summary provides an overview of current trends and projections for future activity. Narrated by Emily Green (2014 President, Minneapolis Area Association of REALTORS®), video produced by Chelsie Lopez.

Weekly Market Report

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Science fairs, book swaps and spring sports have kept winter-weary minds off of what superficially appears to be a mixed beginning to what is typically a cheery second quarter. Most economists, however, believe that the coalescence of market normalization, an improving sales mix and good housing starts are all working behind the scenes to alleviate the growing pains of a market in recovery. Housing is already starting to see signs of upward price pressure, rising consumer confidence and some inventory relief.

In the Twin Cities region, for the week ending April 19:

  • New Listings decreased 2.8% to 1,571
  • Pending Sales decreased 5.3% to 1,227
  • Inventory decreased 0.5% to 14,148

For the month of March:

  • Median Sales Price increased 7.6% to $189,950
  • Days on Market decreased 12.0% to 95
  • Percent of Original List Price Received remained flat at 95.0
  • Months Supply of Inventory decreased 6.1% to 3.1

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

Weekly Market Report

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There’s no dainty tiptoeing through the tulips this spring, as market flower fields are blooming with speculation. Sales and new listings are up, and hope for a fluorescent spring market is flourishing. An increase in inventory is the desire at this point in the season, as more properties for sale should nudge first-time home buyers to sow their fledgling seeds in the housing market and encourage move-up buyers to say goodbye to familiar flower beds in favor of an upsized plot across town.

In the Twin Cities region, for the week ending April 12:

  • New Listings increased 19.9% to 1,925
  • Pending Sales increased 1.8% to 1,157
  • Inventory decreased 2.4% to 13,736

For the month of March:

  • Median Sales Price increased 7.6% to $190,000
  • Days on Market decreased 11.1% to 96
  • Percent of Original List Price Received remained flat at 95.0
  • Months Supply of Inventory decreased 6.1% to 3.1

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

Weekly Market Report

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April reporting brings hope as tulips and FOR SALE signs begin to brighten the housing landscape. Along with that hope is a little uncertainty about some regions’ year-over-year sales and inventory figures. Fear not, however, because rates are still lower than most years in modern memory, there’s proof of an improving mix of properties for sale on the national landscape and upward price pressure continues to motivate potential home buyers. Watch listing activity closely for more hints as to what may be unearthed next.

In the Twin Cities region, for the week ending April 5:

  • New Listings increased 6.1% to 1,839
  • Pending Sales decreased 7.1% to 1,026
  • Inventory decreased 3.6% to 13,241

For the month of March:

  • Median Sales Price increased 7.6% to $190,000
  • Days on Market decreased 12.0% to 95
  • Percent of Original List Price Received remained flat at 95.0
  • Months Supply of Inventory decreased 6.1% to 3.1

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

Traditional Segment Blooms, Sellers More Optimistic

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After being cooped up for a long, cold winter, homeowners in the 13-county Minneapolis-St. Paul metropolitan area showed renewed signs of optimism in March. Seller activity rose 5.5 percent to 6,492 newly listed homes, a crucial increase toward fueling buyer demand. Inventory levels are still hovering near a 10-year low, but consumers should have more options to choose from this year compared to recent years. Pending sales were 8.4 percent lower, resulting from a desired shift to less foreclosure and short sale activity. Most indicators continue to suggest ongoing recovery and stabilization.

It’s imperative to understand market activity by segment. Buyers are now leaning toward traditional purchases first because they are making up a greater share of the marketplace. These properties also tend to be in better condition, many come with warranties and traditional sellers tend to be more cooperative than banks. New traditional listings rose 22.1 percent compared to March 2013, while foreclosure and short sale new listings fell 39.9 and 53.8 percent, respectively.

On the demand side, pending sales declined 8.4 percent to 4,141 properties overall, which still reflects less distressed market activity. Once again, traditional pending sales were up 2.6 percent while pending foreclosure and short sales fell 32.2 and 45.1 percent, respectively. Consumers shopping for homes now have 13,086 properties to choose from – or 4.1 percent fewer than last year at this time, marking the smallest year-over-year decline since November 2013.

“There’s a lot of excitement and positive energy out there, especially among sellers,” said Emily Green, President of the Minneapolis Area Association of REALTORS® (MAAR). “Some would-be sellers have been lifted out from underwater by rising prices and less competition from foreclosures, while other move-up buyers are also eager to buy.”

The lowest price point of the market is evaporating. As a result, the median sales price for the metro rose 7.6 percent to $190,000, marking 25 straight months of year-over-year price gains. Last March, foreclosures and short sales made up 25.2 percent of all new listings. This March, they made up just 13.3 percent. For closed sales, the number fell from 37.6 to 26.6 percent.

On average, homes spent just 95 days on the market, 12.0 percent less than last March. Sellers are receiving an average of 95.0 percent of their original list price. The Twin Cities now has 3.1 months’ supply of inventory, suggesting a favorable selling environment. Importantly, interest rates remain affordable and well below their long-term average.

“Traditional properties are dominating the market again,” said Mike Hoffman, MAAR President-Elect. “As distressed product clears the pipeline, consumers are more likely to embark upon negotiations and transactions with people rather than banks.”

Weekly Market Report

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As April encroaches and spring feels more official, so does the possibility of a brightened, exciting housing market. Even though some areas across the country have seen a pause in buyer activity, the fundamentals remain positive. Traditional home buyers are apt to bud like a spring mix of lavender, peonies and tulips. And home prices are rising as surely as soil is being tilled for another fruitful season, adding even more to those warm fuzzy feelings sure to come.

In the Twin Cities region, for the week ending March 29:

  • New Listings increased 18.4% to 1,599
  • Pending Sales decreased 5.6% to 1,101
  • Inventory decreased 5.5% to 13,056

For the month of February:

  • Median Sales Price increased 14.4% to $183,000
  • Days on Market decreased 10.8% to 99
  • Percent of Original List Price Received decreased 0.2% to 93.6%
  • Months Supply of Inventory decreased 9.4% to 2.9

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

Weekly Market Report

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This spring, investors are expected to play a less dominant role since there are fewer attractive bargains to be had. This allows room for younger families and individuals fed up with rent hikes. The affordability picture has come down but remains attractive, pressured by rising but not fully recovered prices and slightly higher rates. Despite some inventory shortages, several local markets are in balanced territory heading into the peak selling season.

In the Twin Cities region, for the week ending March 22:

  • New Listings increased 2.6% to 1,490
  • Pending Sales decreased 6.9% to 1,010
  • Inventory decreased 6.8% to 12,791

For the month of February:

  • Median Sales Price increased 14.4% to $183,000
  • Days on Market decreased 10.8% to 99
  • Percent of Original List Price Received decreased 0.2% to 93.6%
  • Months Supply of Inventory decreased 12.5% to 2.8

All comparisons are to 2013

Click here for the full Weekly Market Activity Report. From The Skinny.

March Skinny Video

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Where has the Twin Cities real estate market been and where is it heading? This monthly summary provides an overview of current trends and projections for future activity. Narrated by Carson Brooks (2014 Secretary, Minneapolis Area Association of REALTORS®), video produced by Chelsie Lopez.