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Week of April 21, 2008 ( Mpls Assoc of Realtors)
Housing Affordability Index
Months Supply of Inventory
The signs are early and nascent, but there are some promising early
indicators that the Twin Cities housing market is beginning to correct
and pull back from its two year-beeline in the buyer's favor. While
affordability, interest rates and overall supply are still attractive, home
sellers are cutting back on new listings substantially in 2008.
For the week ending April 12, there were 2,156 new listings, down a
full 20.1 percent from the same week last year. That's the fifth week in
the last six that we've seen double-digit percentage drops from 2007
activity. Newly signed purchase agreements (pending sales) are still
behind last year also, posting a 3.8 percent decline.
While our market still faces a long road ahead to full recovery, the
recent reduction in new supply is a positive beacon on the horizon and
undoubtedly welcome news for home sellers.
THE 100/Real Estate Market
summary:
Twin Cities Summary: 4/23/08
http://www.mplsrealtor.com/downloads/the100/Twin-Cities.pdf
by Diana Olick
Tuesday, January 22, 2008
provided by
On days like this, I think it’s important to go back to the ol’ mortgage primer and figure out exactly what
all this news means to you, to your mortgage, to your home equity line and to your home’s financial future. I’ve
said it before, and I’ll say it again: the 30-year fixed is not tied to short-term treasuries.
Fixed mortgage rates are tied to long-term bond yields that move based on the outlook for the economy and inflation. And
guess what? The long-term outlook for the economy isn’t exactly rosy right now.
Today’s rate cut does affect short-term adjustable rate mortgages, but not really as much as you might think. Why?
Because this rate cut was already priced into the market, maybe not three quarter's point, but definitely a half-point. So
if you are facing a reset on your ARM, you’re in much better shape today than you were just six months ago.
For example, if your rate adjusts Feb. 1st, and your ARM is pegged to the 1-year treasury, than your reset is going to
be to 5.25 percent as opposed to the 7.5 percent that it would have been in August. That’s going to make the payment
much more manageable.
So does this cut stem the foreclosure crisis? Maybe a bit on the margins, but not really, and here’s why: the bulk
of the folks facing foreclosure because they can't make their monthly payments have no equity in their homes and no money
to put down on a refinance.
While rates might be lower, this is a market where lenders and investors are much more aware of risk and will gravitate
toward borrowers that represent less risk. So many folks will still find themselves in trouble. For people who are having
trouble paying the initial rate on the loan, forget it. No help there.
As for those looking to buy a home, that is, get a new mortgage, while ARM rates may be lower, the mortgage landscape is
still a far far different tundra than it was just a year ago. You can’t do a stated income loan anymore, and you can’t
do 100 percent financing. Tighter standards don’t change with a rate cut.
And I want to add my two cents here about a home equity line of credit. Yes, the rates are lower now, but I really don’t
think that means we should all start using our homes as ATM’s again, which is what got us all in trouble in the first
place. This is a time to pay off debt, not to gather more. The housing market is still in trouble.
The statement from the Federal Reserve this morning: “incoming information indicates a deepening of the housing
contraction as well as some softening in labor markets.” We all know the price correction in housing is still underway
with home prices across the nation (yes, I know, some markets worse than others) expected to fall further, so this is no time
to put your home in more hoc. Just my two cents, which I’m putting in the bank as we speak.
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Characteristics of Minnesota Home Buyers and Sellers - 2007
In 2007, the Minnesota Association of REALTORS® (MNAR) participated in a survey oversampling of Minnesota
home buyers and sellers. The data was collected by NAR as pat of their annual profile. NAR received 9,966 responses nationally,
and an additional 441 in Minnesota. The purpose of the survey is to help REALTORS® understand how consumers
view the services you provide. | |
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Because the real estate market is always evolving, it is important for real estate professionals to have a clear picture
of today’s home buyers and sellers.
Characteristics of Minnesota Home Buyers
- Median age of all home buyers was 36 years old. Among first-time buyers, the median age was 28.
- The household income of homebuyers was $69,300 compared to $74,000 among all home buyers nationally.
- Sixty-nine percent of home buyers reported that there were no children under the age of 18 residing in the property.
- Fifty-six percent of home buyers were married couples, 24 percent single females, 11 percent single males and 9 percent
were unmarried couples.
- Six percent of homebuyers were born outside of the United States, compared with 9 percent nationally.
- First-time home buyers accounted for 42 percent of homes purchased in 2007.
- Sixty-six percent of first-time home buyers were between 25 and 34 years old.
- The median income of first-time home buyers was $57,500 compared to $58,600 nationally.
- Thirty percent of home buyers reported using social networking Web sites, such as, Myspace, Facebook, Linkedin, and Friendster.
Among home buyers aged 18 to 24, 59 percent reported using social networking sites.
- Nineteen percent of homes purchased were new construction.
- Sixty-four percent of homes purchased were detached single-family.
- The typical home buyer purchased a home 14 miles from their previous residence.
- The median price of homes purchased was $221,900 compared to $215,000 in the U.S.
- The typical buyer purchased a home that was 1,850 square feet in size.
- Recent homebuyers plan to live in their home a median of 10 years.
Over the next few weeks we’ll be providing you with more details about the profile and what consumers are thinking
about the transaction, your services and the future. We also have a CE program that asks consumers about the real estate transaction
and the services provided. Look for it in February – March of 2007. | |
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