Monday, January 16, 2012

It's a Wrap, 2011 Minneapolis St Paul Real Estate Market Steps Towards Balance

Most observers would agree that this year's housing recovery was not as robust as many had hoped. That said, a handful of things went right. Supply-side market correction took the guise of inventory declines and a pullback in listing activity. Consequently, sellers generally faced fewer challenges than in the past. Driven by improvements in the economy and record-low mortgage rates, purchase demand strengthened organically, independent of government incentives. Those sales gains dovetailed with falling inventories to move the market back toward balance. Nobody knows what 2012 will bring, but it's a safe bet that these positive developments will continue to evolve.

In the Twin Cities region, for the week ending December 31:

• New Listings decreased 11.6% to 593
• Pending Sales increased 41.7% to 564
• Inventory decreased 24.9% to 18,341

For the month of December:

• Median Sales Price decreased 5.6% to $145,000
• Days on Market decreased 2.4% to 140
• Percent of Original List Price Received increased 1.8% to 90.6%
• Months Supply of Inventory decreased 36.2% to 4.6

If you're one of the homeowners waiting for the bottom to move up, consider the following:
* A balanced market between homes for sale and buyers buying is considered to be when the market has 4.3 months supply. The market is currently at 4.6.
* Interest rates are lower than ever imagined with available rates as low as 3.75%. So, many buyers are trading their home up for a payment close to their current payment.
* There are many loan programs now available with down payment requirements for as little as 3.5%.
* 2012 trend - Americans no longer primarily consider their home as an investment or a piggy bank but rather a lifestyle choice from which their home is the wellspring for the memories and events that make their life meaningful and brings intangible well being to their daily life.

As always, if you or anyone you know are considering a move this year, contact The Basil Group - for an initial consultation and extraordinary service. There's never been a better time to purchase a new home.