September stats are in and closed sales for the month were virtually the same as last year…which were abnormally high as buyers flocked to take advantage of 100% financing before it went away at the end of September 2008. I expect sales figures for next two months to break away from last year as buyers take advantage of the final days of the 2009 Federal tax credit, which is set to expire the end of November. There is considerable talk that it may be extended, but no guarantees.
Pending sales, indicators of upcoming closed sales, were a whopping 61.2% above last year for the week ending October 3rd! Lender-mediated foreclosures and short sales made up 39.2% of the month's pending sales, significantly down from 60% of sales in the first quarter 2009.
New listings are eerily close to the last two years, but with sales continuing to be higher that means the total number of homes available for sale are continuing to drift downward.
Nowhere are the differences between this year and previous years more apparent than in the total number of homes for sale. There usually is an arc in the number of homes on the market, as it surges up in the spring and back down in the fall and winter. This year's arc is so flat it's almost unrecognizable as 'traditional' sellers have been holding back.
Although sales were still above last year in the lower price ranges, they were 15.4% below last month's level for homes priced below $120K and a bit higher than last month in the $150K-$190K price range. This likely reflects the short supply of homes currently available in the lowest price range as properties are being gobbled up by first- time homebuyers and investors and there is a shift to slighty higher prices. It is now an extreme sellers market in the lowest price range, with only a 2.9 month supply of home available in the under $120,000 price range.
This shift towards slightly higher prices has helped keep median price more stabilized. Median sale price moved up to a higher level in May and June, and has been hovering around that plateau the last few months.
Months supply of inventory has dropped in all categories. Houses have been below 2006 levels since June, and townhomes finally dropped below 2006 months supply of inventory in September. Condos still have a way to go, but have at least dropped consistently below the more-than-a-year supply that held on tenaciously for more than a year.
You can see in the chart above how townhome and house supplies are getting closer. It may be that as the supply of houses has diminished in the lower price ranges, buyers are again choosing townhouses. Condo sales will likely continue to have a bigger challenge as a larger down payment has been required the last two years…clearly indicated in the chart above as the months supply of condos soared above other housing types.
The figures above are based on statistics for the combined 13-county Twin Cities metropolitan area released by the Minneapolis Area Association of Realtors. Click here for links to local reports for 125 metro area communities. Third quarter foreclosure and short sale data should be released later this month.
Sharlene Hensrud, RE/MAX Results - Email – Minneapolis – St. Paul Real Estate Market Information
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