Real Estate Weekly Update
May 16, 2011
Last week marked the official end of year-over-year comparison to the 2010 tax credit period, and we’re likely to have at least one (not uncommon) transitional week to count up the final sales of the tax credit. This week’s numbers are still about as negative as the Minnesota Twins have been this May, but we anticipate a more positive showing in the weeks to come.
For the week ending May 7, Pending Sales were down 27.7 percent to 819 purchase agreements signed, marking the 22nd consecutive week of year-over-year declines in Pending Sales.
There are 23,475 homes to choose from in the 13-county metro area – 210 more than last week but 10.3 percent fewer than last year at this time.
One interesting blip on the radar is that New Listings were up 14.5 percent from last year. A total of 1,774 new homes were introduced to the market, similar to last week but ahead of last year’s post-tax credit drop-off.
Pending Sales over the next four weeks will be compared to 830, 634, 600 and 527, respectively. Those are numbers that even the Minnesota Twins should beat.
Statistics provided by the Minneapolis Area Association of Realtors.
End of Comparison to Heightened Spring 2010 Tax Incentive Market Draws Nigh
Pending sales in the 13-county Twin Cities metropolitan area were down 25.8 percent to 4,289 from April 2010’s incentive market high of 5,781. The overall median sales price dropped 14.6 percent to $145,000. Sellers introduced 7,279 new properties to the market, 25.3 percent fewer than last April, and inventory levels were a welcome 16.1 percent lower at 24,380 units—the lowest April inventory count since 2005.
Since activity was disproportionately strong during April 2010, the months of April 2009 and 2008 can provide more reliable comparisons. Pending sales were down 17.7 percent versus 2009 but up 1.9 percent against 2008; the median sales price was down 5.2 percent compared to 2009; and new listings were down 10.3 percent compared to 2009. Comparing non-incentive markets to similar non-incentive markets provides a different picture – one of stabilization.
Although overall purchase activity was down, overall pending sales for the month were the highest they’ve been since last April and the number of foreclosure pending sales increased by 31.0 percent. Traditional (non-distressed) sales were down 39.0 percent while short sales were down 11.4 percent. Traditional sales prices were down 3.0 percent to $193,000; foreclosure prices were down 18.9 percent to $103,000; and short sale prices were down 9.9 percent to $132,400.
Foreclosures and short sales comprised 46.1 percent of all pending home sales during the month—the lowest level since November 2010 and down from 55.6 percent in January. Also, distressed homes represented 30.5 percent of all new listings—the lowest level since April 2010. “The fact that comparatively more homes in financial distress are selling off the market than are entering the market is a positive sign,” said Fisher.
The average days on market was up to 152 days, the percent of list price received at sale declined to 90.1, months supply of inventory was up to 8.2 months and pending sales gained only at price points above $500,000.
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