You may have seen the front page article in the StarTribune yesterday that showed that according to statistics released this week nearly one-third of all Twin Cities area home sales in 2008 were lender mediated sales, such as foreclosures and short sales. (Percentage was over 50% at the end of the year…will be interesting to get 4th quarter foreclosure stats.)
A positive result of this growth is a continuing dramatic increase in the number of homes for sale under $150,000 and another jump in the Housing Affordability Index to even higher than last month's record high. The supply of homes available for sale under $150,000 is 61% higher than at this time last year…but there were 233% more sales under $150,000 in 2008 than in 2007!! This seems to indiciate these properties are being sold at a faster rate than the supply. As these are primarily foreclosure properties, this is a good sign…we need to sell off this inventory to get back to a healthy market.
As a result of this dramatic growth in the number of lower priced homes overall average sale price has dropped…as has the supply of homes in all prices ranges above $150K except those properties over $1M.
What is interesting is both the number of new listings and closed sales didn't follow the historical downward trend in December. Traditional listings tend to slow in the winter months but foreclosure listings don't…the increase in new lisitngs compared to last year is another indication of the higher percentage of foreclosure properties on the market. The increase in pending sales is a good sign. The year ended with more pending sales than in 2007…the first time that has happened since 2004!!
The figures above are for the combined 13-county Twin Cities metropolitan area. Click here for links to the full December combined market report as well as local reports for 125 metro area communities.
