Q2 2009 Market Update

Date Posted: Thursday, July 23 2009 1:12 PM

The Minneapolis Area Association of Realtors (MAAR) reported in the first quarter foreclosure inventory was down by about 1,200 units to 7,674 units for sale on the Minnesota MLS.  2Q numbers were released on Monday and the trend continues. The supply of these homes has dropped another 2,100 units to 6,685. This is the lowest lender mediated inventory since March 2008.  Albeit, most agents, including myself believe another wave of foreclosures are on the way well into 2010 given the lift foreclosure moratorium, Alt-A and Option Loan resets to come and the continuing rise in unemployment.  

19,298 homes have closed through the first half of 2009. This is a 10% increase over last year. 46% of these sales have been lender mediated transactions, a steep increase over the first half sales in 2008 of 25.7% and 2007 of 8.5%. On a positive note we have seen a continuing decline this year in lender mediated sales from its peek of 60% in January indicating that traditional sales are up and that maybe we are getting closer to a more normal market. Another positive note is inventory is down 13% compared to last year and at the beginning of this month there were 26,204 listings available compared to 33,425 last year. This is a 23% drop in inventory.  This gives the market a 7.3 month supply as compared to 10.6 in 2008. Meaning it would take the current inventory about 7 months to sell out.

The graph below still shows that lender mediated inventory is higher than 2008 at every price point except $120,000 and under.

 
Lender mediated transactions continue to put downward pressure on median sale prices.
 
For listings as of July 1st Edina comes in only at 6% for share of lender mediated inventory, while Brooklyn Center is at a Twin Cities high with nearly 69%. 
 
Top 5 Lowest Share of Lender Mediated Inventory
  1. Edina – 6%
  2. Downtown Minneapolis – 8.4%
  3. St. Paul – Mac/Groveland – 11.9%
  4. Mpls – Calhoun/Isles – 13.1%
  5. Mendota/Lilydael/Mendota Heights – 13.2%
 
Top 5 Highest Share of Lender Mediated Inventory
  1. Brooklyn Center – 68.8%
  2. North Mpls – 64.4%
  3. St. Paul – Central – 61.5%
  4. St. Paul – Phalen – 59.1%
  5. Mpls – Powderhorn – 55.6%
 
Want to see how lender mediated transactions are affecting your neighborhood click here. Q2 2009 Update

Comments

Market Update

Posted by minnesota first time home buyersJul 29, 2009 12:00 AM CDT 
Thanks so much for the market update Kevin. It is interesting to see how pending sales still remain so strong. Good news indeed.

Posted by South of The River NewsAug 2, 2009 12:00 AM CDT 
The highlight that the media seems to miss is that the current inventory is lower and homes ARE moving, which is one of the first steps back toward a balanced market. Thanks for the great info Kevin!

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