Rochester MN Real Estate Market Blog » Real Estate Articles

How Low Can You Go: Is the Buyer’s Market Finally Over?

admin — Mon, 16 Jan 2012 19:27:39 +0000

Between economic woes and the housing bubble burst, home buyers have appeared to have the upper hand in the real estate market for several years now. With fewer active buyers, more homes for sale, tighter lending restrictions, and falling home prices, sellers were at a clear disadvantage.

The big question is – is the buyer’s market over? Signs point towards yes. Very low listing inventory levels and increased buyer demand, combined with sellers’ unwillingness, and inability, to let prices go much lower, are shifting the balance of power back away from buyers.

For years, the homes that were listed for sale were by those that either had to sell or could afford to lose some of the equity in their homes. Of course there were also those that entered the market hoping for interest at their asking price, rather than pricing at the true market level. Needless to say, the majority of those homes languished on the market.

Regardless, as housing prices continued to drop, lost equity and lost income prohibited home owners from entering the market to move or to move up. Lost confidence in the economic market also contributed to the housing status quo.

In recent months we’ve seen increased buyer demand as consumer confidence begins to build again. Mortgage interest rates have continued to break records reaching lows unimaginable just a few years ago, potentially putting home ownership within reach of a broader pool of buyers, especially in light of tighter lending practices. According to MSN Real Estate there are also more cash buyers, putting mortgage-backed buyers at a disadvantage. Wherever they come from, more buyers means more competition. And a growing buyer pool with a shrinking seller pool means the balance of power continues to shift.

At the same time, home sellers are drawing a line in the sand. For those with mortgages (which is almost everyone), there is only so low the selling price can go without bank cooperation, as in the case of a short sale. Unless one must sell, there is little incentive for home owners to list at all, let alone lose money on the deal. Sellers must protect whatever remaining equity they have. Seller reticence has certainly lessened buyer power in real estate transactions, but at the end of the day, there still must be a buyer willing to pay what a seller is willing to accept for a sale to take place.

Regardless of whether the market favors sellers or buyers, the homes that sell are the ones that are the most desirable – those with the best condition, in the best location, with the best price. It pays to understand the market – where the buyers are, what interests them, and what they need to close the deal.

If you’re considering buying or selling, give us a call. We know what’s selling, we know who’s looking, and we can help you get your best deal.

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

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Rochester Minnesota Housing Market Update – January 2012

admin — Mon, 16 Jan 2012 19:23:15 +0000

The Rochester, Minnesota housing market may have slowed way down in December, 2011, but overall the market improved over 2010. There were 9.9% more signed contracts and 6.5% more closings in 2011, an impressive sign given the absence of the Homeowner’s Tax Credit that boosted real estate activity in 2009 and 2010. Another positive sign – although the average selling price in 2011 was 1.6% lower than in 2010, the total volume of homes sold increased 8% year over year.

New listings (75) in December, 2011 were down by a third from the previous month and more than 16% over last December. Signed contracts (94) were also down from the previous month, but were up more than a third from the last month of 2010. Average market time in December reached 177 days, the longest we’ve seen in more than a decade.

Active listings have dipped below the 600 mark, a 40% drop from a year ago. We’ll be watching to see how the market heats up as we head into the spring selling season.

For the latest in local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

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Minnesota Housing Outlook – Looking Back and Looking Ahead

admin — Tue, 22 Nov 2011 14:34:52 +0000

From home ownership trends to predictions regarding future home prices, Rochester, Minnesota appears to be holding its own.

The 2010 Census information is beginning to be released and, according to 24/7 Wall Street’s analysis of the data, Minnesota has the 2^nd highest percent of home ownership (73%), second only to West Virginia. This analysis points towards home ownership being higher in states that have lower home prices and a lower population density. Minnesota’s median home value was $200,400 according to the 2010 Census, ranking 20^th among all states. Minnesota’s population in 2010 was 5,310,584.

Nationally, home ownership was at 65.1% in April 2010, down 1.1 percentage points from a decade earlier, but a drop of more than 4 points from the middle of the decade, according to CNNMoney. This represented the biggest negative change since the 1930s when home ownership dropped 4.2%.

According to CNNMoney.com, median home prices are expected to continue falling, with a drop of another 3.6% expected by the end of June 2012. The Rochester area housing market saw a 2% drop in home prices from the second quarter of 2010 through the second quarter of 2011. In the last 20 years, according to Fiserv, the worst one year price change in Rochester, Minnesota came in the first quarter of 2008 when median home prices dropped 5.9%. On a positive note, the forecast change in housing prices from the second quarter of 2011 through the second quarter of 2012 is expected to be a drop of just 1%, with an increase of 1.3% in the twelve months following that.

If you have any questions, please don’t hesitate to contact me. As always, I am working to make your home buying and selling a rewarding experience.

Shawn Buryska, ABR, CRS, GRI
Coldwell Banker Burnet Realty
www.ShawnBuryska.com
507-252-6745 – Direct
507-254-7425 – Mobile
507-252-6845 – Fax

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

Looking for a Silver Lining – Mortgage Interest Rates Continue to Drop

admin — Tue, 16 Aug 2011 11:57:05 +0000

Last week was a tough one in the financial markets following the debt rating downgrades. Nevertheless, the resulting decline in mortgage rates could mean significant savings for home buyers. The interest rate on a 30-year mortgage fell to 4.32% last week, down from 4.39% a week earlier, according to Freddie Mac’s Primary Mortgage Market Survey. The record low for a 30-year mortgage was 4.17% set last November.

Last week saw record-setting lows on 15-year fixed mortgages for the second week in a row, falling to 3.5%. Not surprisingly, refinancing activity has picked up in light of the lowered interest rates. On a $200,000, 30-year loan a borrower would save more than $29,000 on a 4.32% loan during the loan period compared to a 5% fixed mortgage.

At this writing rates have continued to fall, so be sure to check with your mortgage lender for the most current information and for assistance in deciding what is best for your personal situation.

If you have any questions, please don’t hesitate to contact me. As always, I am working to make your home buying and selling a rewarding experience.

Shawn Buryska, ABR, CRS, GRI
Coldwell Banker Burnet Realty

www.ShawnBuryska.com
507-252-6745 – Direct
507-254-7425 – Mobile
507-252-6845 – Fax

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

Residential Real Estate Market Update for Rochester, Minnesota – August 2011

admin — Tue, 16 Aug 2011 11:52:50 +0000

Compared to last year’s flurry of buyer activity and sharp drop-off following the end of the tax credit, Rochester, Minnesota home buyers have been more consistent with home sales achieving a more typical pattern. The number of Rochester, Minnesota homes going under contract is actually 4.6 percent ahead of last year at this time. Combined with lower seller activity and continued low interest rates, the absorption rate has dropped to less than half of what we saw a year ago.

Signed contracts on Rochester area homes were 37 percent higher than last July, despite dropping nearly 13 percent from the previous month. The 137 homes that went under contract had an average asking price of $194,783. Average market time for these homes was 163 days, the longest average we’ve seen in Rochester since February of 2008, but an indication that certain homes are finally moving off the market.

We’ll be watching in the coming months to see the impact of the erratic financial markets. For the latest in local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

Proposed Reforms of Concern to All Home Owners

admin — Thu, 14 Jul 2011 10:42:44 +0000

At the National Association of REALTORS Mid-Year Conference in Washington, D.C. there was much discussion regarding several reforms proposed by regulators that would negatively impact homeowners and sellers.

The Mortgage Interest Deduction (MID) is of concern to all homeowners. This tax deduction has been around for over 100 years and undoubtedly makes a huge difference at tax time. Be sure to let your congressman know that you do not want to see the MID reduced or taken away.

Other critical issues we discussed include:

Mortgage Assistance Relief Services (MARS) — Additional disclosures would be required for those facing foreclosure or short sale. The NAR has been working with FTC regulators to modify the language.
Qualified Residential Mortgage (QRM) — Presented as reforms to prevent another mortgage meltdown crisis, this regulation may easily take home ownership way beyond the reach of the average American. the NAR is working to protect the interests of homeowners.

During these meetings, our delegation and I personally met with several politicians, included Senators Al Franken and Amy Klobuchar and Representatives Tim Walz, Eric Paulson, and Michelle Bachman, to help them understand the problems these types of reforms would create.

From time to time our state and national boards will send out a Call To Action whereby we can very easily send an email to our elected political leaders in our respective districts calling attention to the importance of any particular urgent issue at the time. If you would like to be added to my Call To Action list where you too can also make your voice heard, please send me your name and email address and I would be happy to add you to the list.

If you have any questions about these issues, please don’t hesitate to contact me. As always, I am working to make your home buying and selling a rewarding experience.

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

Rochester, Minnesota Housing Market — Monthly Update July, 2011

admin — Thu, 14 Jul 2011 10:42:15 +0000

Through the first half of 2011, there were 934 signed contracts, up slightly from a year ago. There were 157 residential properties in Rochester, Minnesota that went under contract in June, 2011, a drop of nearly 18% from a month earlier, but up 34% from last year. Average list price for these homes was $195,466. Average market time for homes going under contract in June, 2011 dropped to 120 days, two weeks shorter than in May and two-and-a-half weeks shorter than last June.

New residential listings through the first half of the year were down 16% compared to the first half of 2010. The 169 homes that came onto the market in Rochester, Minnesota in June, 2011 represented a drop of nearly 13% from a month earlier and a year over year decline of 6%. In June, 210 homes closed with an average selling price of $196,786; average market time was 117 days.

For the latest in local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

News from the National Association of REALTORS Mid-Year Conference

admin — Fri, 20 May 2011 14:04:35 +0000

Last week I had the privilege of attending the National Association of REALTORS Mid-Year Conference in Washington, D.C. There are several reforms proposed by regulators that would negatively impact homeowners and sellers.

Other critical issues we discussed include:

Mortgage Assistance Relief Services (MARS) — Additional disclosures would be required for those facing foreclosure or short sale. The NAR has been working with FTC regulators to modify the language.
Qualified Residential Mortgage (QRM) — Presented as reforms to prevent another mortgage meltdown crisis, this regulation may easily take home ownership way beyond the reach of the average American. the NAR is working to protect the interests of homeowners.

If you have any questions about these issues, please don’t hesitate to contact me. As always, I am working to make your home buying and selling a rewarding experience.

Shawn Buryska, ABR, CRS, GRI
Coldwell Banker Burnet Realty
www.ShawnBuryska.com
507-252-6745 – Direct
507-254-7425 – Mobile
507-252-6845 – Fax

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

7 Reasons Homesellers Should Pay for a Pre-Inspection

admin — Fri, 13 May 2011 10:56:48 +0000

Traditionally, home buyers pay for an inspection once a purchase agreement has been reached, and then any deficiencies are negotiated, where appropriate. There are several reasons why it’s in the seller’s best interest to pay for a professional home inspection before listing the home for sale.

Avoid Costly Surprises – Identifying potential problem areas before you list allows you to prioritize issues to address within your budget constraints
Reduce Stress – When both buyer and seller understand the property’s strengths and weaknesses up front, there’s less likelihood of a deal falling through post-inspection.
Save the Buyer Money – When buyers pay for inspections on properties that don’t result in a signed contract, that can be discouraging and expensive. When your property is pre-inspected, the buyer can be confident that even if they choose to pay for their own inspection it will be money well-spent since a closed deal is more likely to happen.
Simplify the Process – In some states the buyer can elect to waive an inspection, further reducing opportunities to haggle over the price, resulting in a better price to the seller.
Target the Proper Price Point – When you and your Realtor are aware of your property’s pros and cons it is easier to identify the price range where your home has the best chance of finding the appropriate buyer in the least amount of time.
Position for a Faster Sale – Again, knowing the selling points and the deficits up front will allow your Realtor to market your home in the way most likely to attract the right buyers from the beginning, meaning a quicker sale and better final sale price.
Knowledge is Power – Home buyers are more likely to offer on a known quantity. A home with a pre-inspection has fewer unknowns than one without, and the buyer can be more confident that they are aware of potential problems BEFORE they make an offer. This in turn can increase the likelihood of a realistic, acceptable offer.

Your real estate professional can assist you in determining the best approach for your property. Be sure to seek the advice of real estate and legal professionals to make sure you are within the laws of your region and state.

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota

Monthly Market Update for Rochester, Minnesota

admin — Wed, 09 Mar 2011 15:32:48 +0000

It may be cold outside, but the Rochester, Minnesota area residential real estate market is warming up. Although new listings (229) were down 19% from last February, this represented a 52% increase from the previous month and was the largest number of new listings since last April. Average asking price of these new listings was $205,079.

Another sign that the Rochester, Minnesota area residential real estate market started off the year in the right direction was the largest number of signed contracts in the first month of the year since 2008. The 106 agreements in February represented the most activity we’ve seen in one month since September, 2010. The average market time for these properties was 134 days, up slightly from January and from last February.

The average sold price for the 86 homes that closed last month was up 2% from last February. The average sold price of $168,851 was 95.5% of the asking price, and just 85.1% of the original list price. Average market time for these homes was 152 days.

Like spring flowers, real estate signs are popping up in area yards as the spring selling season continues to warm up.

For the latest in local real estate stats make sure to check out http://www.shawnburyska.com/real-estate-statistics.php

Shawn Buryska ABR, CRS, GRI
Coldwell Banker Burnet Realty
507-252-6745
www.ShawnBuryska.com

Shawn Buryska, Coldwell Banker Burnet Realty, Licensed in the state of Minnesota