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Friday, December 12, 2008Minneapolis Real Estate Market Update
Today we are going to take a look at market activity during the week of December 8 for the Thirteen County area of the Twin Cities. The numbers will look like things are decreasing, but they are predictably this way for the couple weeks after Thanksgiving. Starting next week (December 15th) the numbers will be more accurate for showing year over year comparisons. The main highlight for this week is the housing affordability index (HAI), which has gone up 19 points, from 161 to 180 points! This is the best HAI we have seen since 1990! It is definitely still a buyer’s market.
Here are some examples of the decreases: new listings are showing a very steep decrease at 45.2% going from 1,485 this week in 2007 to 814 this year. In relation to that, supply and demand is steadily decreasing as well, with a 16.1% decrease over last year at this time and is still 12.06 houses on the market per buyer. Last year at this time there were 14.38 houses per buyer, so we’re definitely seeing something positive happening there. Pending sales are also showing a predictable 20.5% decrease with 424 properties pending this last week. Active listings remain steady with a consistent decrease of 8.6% and currently there are 27,374 houses on the market.
Because Thanksgiving took place at different time locations comparing 2008 to 2007, the year over year numbers are a bit skewed. Hopefully over the next couple weeks we’ll be able to show the comparisons more accurately. And after the holiday season is over, we should see things looking up. With mortgage interest rates still very low and predictably getting lower and home prices still falling, we will hopefully see more buyers getting off the fence and making purchases, lessening the amount of inventory. With this home prices will one day begin to rise and the market can return to a more “normal” level. How far away are we from that? Only the numbers will tell!
