Real Estate Blog

By Burl Gilyard, MinnPost, 5/23/16

Ten years ago, downtown Minneapolis was in a condo-building frenzy. Hardly a week passed without someone announcing a new project or conversion. Developers could barely keep up with the feverish demand for condo units, while investors were pocketing profits from flipping units as the national housing boom continued to push prices higher. The median sales price for downtown Minneapolis homes (nearly all were condos) reached $270,000 in 2006, up 85 percent in just five years. Owners were convinced these were not just homes, they were good investments.

But the Great Recession changed this as much as it affected the rest of the nation’s residential real estate market. Condo projects were scrapped, empty units piled

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Keeping Current Matters, 5/24/16

Today, many real estate conversations center on housing prices and where they may be headed. That is why we like the Home Price Expectation Survey.

Every quarter, Pulsenomics surveys a nationwide panel of over one hundred economists, real estate experts and investment & market strategists about where they believe prices are headed over the next five years. They then average the projections of all 100+ experts into a single number.

The results of their latest survey:

Home values will appreciate by 4.0% over the course of 2016, 3.4% in 2017 and 3.0% in the next two years, and finally 2.8% in 2020 (as shown below). That means the average annual appreciation will be 3.2% over the next 5 years. 

The

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Keeping Current Matters

The price of any item is determined by the supply of that item, and the market demand. The National Association of Realtors (NAR) recently released their latest Existing Home Sales Report which gives insight into today’s market conditions.

Inventory Levels & Demand

Sales of existing homes rose 5.1% month-over-month in March and are 1.5% higher than this time last year. Sales rose in all four major regions in March.

Total unsold housing inventory is 1.5% lower than March 2015 at a 4.5-month supply and remains well below the six months that is needed for a historically normal market.

Consumer confidence is at the highest level in over a decade. Pair that with interest rates still below 4%, programs available for

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Keeping Current Matters, 4/25/16

In today’s market, where demand is outpacing supply in many regions of the country, pricing a house is one of the biggest challenges real estate professionals face. Sellers often want to price their home higher than recommended, and many agents go along with the idea to keep their clients happy. However, the best agents realize that telling the homeowner the truth is more important than getting the seller to like them.

There is no “later.”

Sellers sometimes think, “If the home doesn’t sell for this price, I can always lower it later.” However, research proves that homes that experience a listing price reduction sit on the market longer, ultimately selling for less than similar homes.

John Knight,

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Keeping Current Matters, 4/6/16

A few weeks ago, Jonathan Smoke, the Chief Economist at realtor.com, exclaimed: “All indicators point to this spring being the busiest since 2006.” Now, Freddie Mac has doubled down on that claim and is saying that 2016 will be the best year that the real estate industry has seen in a decade. In their March Housing Outlook Report, Freddie Mac explained:

“Despite the challenges facing the housing market, we expect this to be the best year for housing in a decade. Home sales, housing starts, and house prices will reach their highest level since 2006 according to our latest forecast…Challenges remain, with low housing supply and declining affordability being a key concern in many markets, but on balance, the housing

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Some Highlights:

• Harvard University's Joint Center of Housing Studies recently released the top financial & emotional reasons to own a home.
• Owning is a good way to build up wealth that can be passed along to your family as it is usually a form of "forced savings."
• You're paying for a house whether you own or rent, but owning gives you control over your living space.

Keeping Current Matters, 3/16/16

Some Highlights:

• Many buyers are purchasing a home with a down payment as little as 3%.
• You may already qualify for a loan, even if you don't have perfect credit.
• Take advantage of the knowledge of your local professionals who are there to help you determine how much you can afford.

Keeping Current Matters, 3/10/16

We recently reported that home prices are continuing to rise across most of the nation. This has created concern in some pundits that a housing bubble, like we saw ten years ago, is forming again. We want to explain why these concerns are unfounded. The current increase in home values can be easily explained by the theory of supply and demand. Right now, the number of families looking to purchase a home is greater than the supply of homes on the market. Here is a chart that explains how the months’ supply of housing inventory impacts home values: 

According to the latest Existing Home Sales Report from the National Association of Realtors, there is currently a four-month supply of inventory. That puts us in

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By Jim Buchta, StarTribune 3/15/16

The kickoff to the spring housing market in the Twin Cities was unseasonably strong — especially for sellers.  

During February, there was a 6.7 percent increase in signed purchase agreements in the 13-county metro area, according to a monthly sales report released Monday by the Minneapolis Area Association of Realtors. Though new listings increased slightly in February, there were just 10,953 available properties at the end of the month, a 19.4 percent decline compared with last year.

With buyers outpacing sellers in some parts of the metro area, that meant stiff competition and little room for buyers to negotiate. The median price of all closings during the month was $207,395, a 3.7 percent increase

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Keeping Current Matters, 3/8/16

According to the latest Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index homeownership is a better way to produce greater wealth, on average, than renting. The BH&J Index is a quarterly report that attempts to answer the question: 

Is it better to rent or buy a home in today’s housing market?

The index examines the entire US housing market and then isolates 23 major markets for comparison. The researchers use a “'horse race' comparison between an individual that is buying a home and an individual that rents a similar quality home and reinvests all monies otherwise invested in homeownership.” Ken Johnson Ph.D., Real Estate Economist & Professor at Florida Atlantic University, and one of the index’s authors

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