In July 2011, foreclosures and short sales accounted for 45.4% of home sales in the Twin Cities. In July 2013, these same market segments made up only 26% of home sales. As far as new listings, in July 2011, distressed properties made up 41.2% of the market, but in July 2013, only 17.9%.
Traditional sellers are coming back into the market. All new listings were up 24.6%, but the traditional homes on the market were up 55.7%, the highest increase in almost ten years. Inventory is still low, down about 13% from July 2012 which is making this a seller’s market. The average days on market time is now 72 days and sellers are receiving an average of 97.5% of asking price which is the highest ratio in about seven years.
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Even though the weather has been cold and snowy, the home buyers are out in full force in the Twin Cities this year! According to the S&P/Case-Shiller study, Minneapolis-St. Paul was one of just 8 US cities with double digit price increases, up 12.1% in January 2013 from January 2012.
According to the Shenehon Center for Real Estate at the University of St. Thomas the median sale price in the Twin Cities in February was $205,500 which is a 14.2% increase over February 2012 and this number is just for traditional sales, not distressed properties. The last few months have shown that sales of traditional homes account for 50% or more of all sales which is a very positive sign.
The biggest market challenge is still the low inventory of homes for sale which is driving up prices. Hopefully with the sales prices on traditional homes increasing more home owners will have better equity positions and will be able to put their homes up for sale.
Builders are also reaping the benefits of low home inventory with more people looking to build. There were 360 building permits issued for single-family homes in the 13-county metro area in January, which is an 80 percent increase over the 200 permits issued in January 2012.
In Minneapolis in February 2013, there were 2,736 closed home sales, down 4.7% from a year earlier. The number of homes for sale dropped 31.6% to 12,202 active listings. This represents the lowest number since January 2003.
Listings of traditional sales is up and distressed properties is down which is great for the market. Traditional sales jumped 21.5% year-over-year, while foreclosures and short sales dropped 23.5% and 28.5%, respectively.
Buyers are out in force this spring and they are motivated, now we just need the sellers to get their homes on the market so there is something for these buyers to purchase!
According to the Minneapolis Area Association of Realtors the market for January 2013 was better than January 2012. This is really no surprise as it was expected. Closings on homes were up 11% and pending sales were up 13.3% in January 2013 over January 2012. The inventory also continued its decline down 32.2% over January 2012 which is also the lowest inventory of homes in the Twin Cities for any month of the year since January 2003!
Traditional sellers are coming back as well. In January 2013, traditional homes were 65.9% of the market up from 56.3% in January 2012 and the closed traditional sales were also up to 57.1% from 44.8% in January 2012.