The Skinny

Weekly Market Activity Report 4.7.08

The Twin Cities housing market is showing early signs of entering a positive phase of correction. The number of new listings entering the market for the week ending March 29 was 14.8 percent behind the same week last year, the fourth consecutive week of double-digit declines relative to last year. Unfortunately, pending sales remain lackadaisical (down 15.9 percent for the same time period comparison), so the total inventory of homes for sale continues to exhibit decelerating growth this spring season—an encouraging momentum change in our shifting supply-demand balance.

This week's edition of the MAAR Weekly Market Activity Report features updated figures for several key metrics. In March, the Days on Market Until Sale held steady at 165 and the Percent of Original List Price Received at Sale dipped slightly to 91.0—both indicators of the continued advantage the buyer holds in this market. The April Months Supply of Inventory increased to 9.6 months, up 23.9 percent from this time last year. A market that's balanced between buyers and sellers would have roughly a 5- to 6-month supply of homes for sale. We haven't been there since 2005.

Weekly Market Activity Report 3.31.08

Vamoosh! Home sellers in the Twin Cities are continuing their great disappearing act, with new listings on the market in 2008 sitting far below last year's rate. Over the last three months, there have been almost 2,500 fewer listings put on the market than there were a year ago—a drop of 9.5 percent.

Inventory is still more plentiful than ever.  Despite the pullback, we still have a record high number of houses on the market for this time of year. So what's the takeaway here? Well, if we look closer, we can see that the inventory gap between now and one year ago is closing, and closing hard. We've gone from being up 12.6 percent from a year ago to only 5.5 percent up in the last 12 weeks.

Gut check: We must keep perspective on the challenging environment that sellers still face, despite the softening competition. The number of signed purchase agreements (pending sales) for the last three months is 17.7 percent behind the same period a year ago. There's fewer of everything.

Click here for the full Weekly Market Activity Report.

Weekly Market Activity Report 3.24.08

Potential home buyers waiting for even more new inventory to hit the market may be waiting a long time. For the week ending March 15, there were almost 300 fewer properties put on the market in the Twin Cities than during the same week in 2007—a decline of 12.0 percent. And the number of new listings on the market in the last three months is 6.9 percent behind the same time one year ago. So while total inventory remains high, the frenzied peak of seller activity appears to be behind us.

The number of newly signed purchase agreements jumped significantly from the previous week; and for the same time period comparison last year was down only 8.9 percent. While this is a positive indication that buyers may be beginning to recognize the tremendous opportunities available, we are by no means out of the woods yet. Let's at least hope we're out of the snow.

Weekly Market Activity Report 3.17.08

"So tired, tired of waiting for you" -- The Kinks, garage-rock innovators and noted housing economists

Still waiting! Buyer activity remains relatively lethargic in the Twin Cities housing market. For the week ending March 8, the number of new purchase agreements signed was 682, behind the same time last year by 18.7 percent. Despite the deluge of properties available, rapidly improving affordability, attractive interest rates and motivated sellers, buyers appear to be unwilling or unable to take advantage of this incredibly attractive buyer's market.

This conundrum begs a question: Do buyers remain on the sidelines because they so choose or because they have no choice? In other words, is it tightening lending rules or a sincere lack of consumer interest that is keeping buyers in stasis? What do you think?

This month's edition of the MAAR Weekly Market Activity Report features an updated figure for Months Supply of Inventory, which jumped in March to 9.2. This means that it will take the current supply of properties for sale roughly 9.2 months to sell through completely.

Calling All Brokers! If MAAR were to host a broker summit that gathered Twin Cities real estate brokers together, what speakers would you be willing to pay to listen to? These speakers can be national or local, real estate related or general. Please share your thoughts with Linda Stoeckicht at lindas@mplsrealtor.com.

Click here for the full Weekly Market Activity Report.

Weekly Market Activity Report 3.10.08

The number of new listings on the market has been relatively small so far in 2008. Over the last eight weeks, there have been roughly 1,200 fewer listings put on the market than during the same eight weeks in 2007—a decline of 6.7 percent. The decline in purchase agreement activity during the same period is on a more extreme decline, however—falling by 17.8 percent for the same time period comparison.

What buyers need to hear about is the significant improvement in affordability. Despite an increase in mortgage rates, the Housing Affordability Index (HAI) shot up dramatically for March to 157, the highest figure in five years! The HAI increased thanks to a decline in sales prices in February and increased consumer income. The home buying environment has been getting exponentially more attractive with each passing month, which is great news for those waiting on a real estate market rebound.

This week's MAAR Weekly Market Activity Report features updated figures for several important metrics. Days on Market Until Sale held steady at 165 in February, an increase of 12.2 percent from last year. The Percent of Original List Price Received at Sale increased slightly to 91.1 percent, and should continue to rise in the spring months as it does each year.

Do buyers recognize the improving affordability and what it means to their bottom line? Let us know what you think by clicking the "Comment" link below and sharing your thoughts.

Click here for the full Weekly Market Activity Report.

Weekly Market Activity Report 3.3.08

"The greatest enemy of progress is not stagnation, but false progress." – Sydney J. Harris (1917–86), famed columnist

New listings for the week ending February 23 posted 1,832 units, down 10.1 percent from the same week in 2007. Signed purchase agreements (pending sales) declined from last year by 15.9 percent for the same time period comparison, posting 635 units. Despite the general decline in seller activity, the total number of homes for sale is ahead of this time last year by 9.8 percent. Also, this week's Weekly Market Activity Report features a new March Supply-Demand Ratio of 8.72 houses per buyer, down from last month's figure of 10.02 but up 38.4% from March 2007.

Looking for a silver lining to the weekly litany of grimacing news? Well, the seemingly endless swell in the growth of homes for sale has steadily declined. The Supply-Demand Ratio is the lowest it's been since June 2007. Housing affordability is at its highest point since 2004. And we're receiving anecdotal evidence of increased buyer traffic beyond seasonal norms over the past few weeks.

It ain't all bad news, folks. The word on the sheet may not yet match the work on the sheet, specifically pending sales, but ample supply, lower interest rates, weakening median prices and healthy affordability are all historical buyer opt-ins.

Buyers are out there. They may not yet be certain the market has hit bottom or that appreciation will return anytime soon, but unless everyone moves away or decides to rent or does absolutely nothing, pent up buyer demand has the inevitable feel of unfurl. Whether it has already begun or starts a year from today is something we have yet to learn, but buyers are out there.

We are currently highlighting MAAR's two housing market classes for continuing education credit. "Real Estate Math: Statistics" provides instruction on how to find, interpret and utilize statistics on the housing market. "Wake Up, Shift Happens!" is an interactive analysis of where the housing market has been and is going next.

Real Estate Math: Statistics
Date and Time: March 18, 1:00 p.m. – 4:00 p.m.
Credits: 3
Instructor: Jeff Allen, MAAR Research Manager
Location: MAAR Office

Wake Up, Shift Happens!
Date and Time: March 19, 9:00 a.m. – noon
Credits: 3
Instructor: Jeff Allen, MAAR Research Manager
Location: MAAR Office

Register online or contact Delores Dahlsten at deloresd@mplsrealtor.com or 952.988.3153.

Click here for the full Weekly Market Activity Report for 3.3.08.

Weekly Market Activity Report 2.25.08

With mercury dropping, snow falling, lips cracking, wet hair freezing, and cars stalling, February has mostly been an exercise in old-fashioned winter hibernation for those of us brave (or foolish) enough to live in the Twin Cities. The weather is by no means the only explanation for the lackluster showing of area home buyers—the uncertainty in the credit markets and dampened consumer confidence are obviously playing their own crucial roles—but it certainly isn't helping. That's why the uptick in temperatures seen in recent days is a welcome sight for home buyers, sellers and real estate brokers alike.

New listings for the week ending February 16 posted 1,859 units, down 8.3 percent from the same week in 2007. Signed purchase agreements (pending sales) declined from last year by 17.8 percent for the same time period comparison, posting 624 units. Despite the general decline in seller activity, the total number of homes for sale is ahead of this time last year by 12.1 percent.

Thank you to all who shared their thoughts with us on the state of the Twin Cities housing market in our survey last week. The quantity and quality of the responses we received were extraordinary. Keep your eyes peeled in the weeks ahead -- we'll be summarizing the great input we received here in the near future.

MAAR's two housing market classes are being offered again soon, both for continuing education credit! "Real Estate Math: Statistics" provides instruction on how to find, interpret and utilize statistics on the housing market. "Wake Up, Shift Happens!" is an interactive analysis of where the housing market has been and is going next.

Real Estate Math: Statistics
Date and Time: March 18, 1:00 p.m. – 4:00 p.m.
Credits: 3
Instructor: Jeff Allen
Location: MAAR Office

Wake Up, Shift Happens!
Date and Time: March 19, 9:00 a.m. – noon
Credits: 3
Instructor: Jeff Allen
Location: MAAR Office

Register online or contact Delores Dahlsten at deloresd@mplsrealtor.com or 952.988.3153. Each class will be offered several times this year. Check your printed edition of The Source, MAAR's education catalog for dates and times or visit The Source online. Dates and times for "Real Estate Math: Statistics" and "Wake Up, Shift Happens!" are listed on page 23.

Click here for the full Weekly Market Activity Report.

Weekly Market Activity Report 2.18.08

"Under the right circumstances, groups are remarkably intelligent, and are often smarter than the smartest people in them."

– James Surowiecki, The Wisdom of Crowds

As 2008 progresses, the picture remains relatively static. New listings are holding steady with last year's pace, home sales remain sluggish and the total inventory of houses for sale is at record levels—all of which points to a market in the buyer's favor. Yes, it's been a challenge to think of fresh ways to say the same thing every week: Sales down, inventory up. buyer's market, interest rates low, prices low, affordability high, buy now. If it were 1978, we'd be a broken record; 1988, a tangled tape; 1998, a skipping CD. But it's 2008, and digital capabilities have eliminated these faults while increasing the ability to interact with the makers of the recording. So let's take advantage.

We're the experts at compiling the numbers into useful reports. But you're the experts on the street. Tell us where you think the Twin Cities housing market is headed. Draw on your personal experiences to help us answer four direct questions:

How long will this extreme buyer's market continue?
What needs to change for the rebound to begin?
What is the current psychological mindset of buyers?
What is the current psychological mindset of sellers?

Click here to answer these questions and submit your responses!

We'll compile the answers and highlight some notably thoughtful and thought-provoking answers in an upcoming post on this very blog, coming next month as part of our website overhaul.

In case you watch this space each week simply for the weekly numbers, here they are: For the week ending February 18, new listings posted 2,125 units, up 1.9 percent from the same week in 2007. New purchase agreements (pending sales) posted 634 units, down 13.9 percent for the same time period comparison.

Click here for the full Weekly Market Activity Report.

Weekly Market Activity Report 2.11.08

With both the temperature and the region's home prices dropping, home buyers who are willing to brave the harsh and cold meteorological landscape are finding the home buying environment quite warm and welcoming. The MAAR Housing Affordability Index (HAI), which measures how affordable Twin Cities housing is to its residents, jumped in February to 149—the highest level in nearly four years—thanks to continued declines in mortgage rates, a smorgasbord of homes to pick from and a seller psychology that is motivated to move and ready to negotiate.

For the week ending February 2, the number of new units on the market was 1,930—a full 10.2 percent behind the same week in 2007. The decline in listings was met by an even more hearty decline in signed purchase agreements, as pending sales fell by 28.7 percent for the same time period.

Besides the HAI, this week's edition of the MAAR Weekly Market Activity Report features updated figures for several other metrics. In January, the Days on Market Until Sale increased to 165 and the Percent of Original List Price Received at Sale fell to 90.9—both indicators of the continued advantage the buyer holds in this market. The February Months Supply of Inventory increased to 8.9 months, up 37.5 percent from this time last year. A market that's balanced between buyers and sellers would have roughly a 5- to 6-month supply of homes for sale.

Click here for the full report.

Weekly Market Activity Report 2.4.08

With the new year in full swing and the unofficial national holiday of Super Bowl XLII now under our pizza-and-beer-stretched belts, the number of homes for sale in the Twin Cities housing market is beginning its annual ascent. With just over 28,000 units on the market as of this morning, inventory is 11.8 percent higher than this time last year—a new record for this time of year. For the week ending January 26, there were 528 purchase agreements signed (pending sales), a decrease of 16.9 percent from the same week in 2007.

The net result of growing supply meeting cooled demand is a market tilted in favor of the buyer—a dynamic we can clearly see in our new February 2008 Supply-Demand Ratio (SDR) of 10.02. This means that there are 10.02 houses on the market for every buyer expected this month, up 36.9 percent from February 2007—a tougher environment for sellers.

Consider the flip side of this coin. With a bounty of inventory to peruse, historically low interest rates, improving affordability and motivated sellers, this is truly one of the best times to buy real estate in recent history.

Click here for the full report.