Minneapolis Housing Stats..Great News!

Great News! Don't be Caught on the Sidelines This Time!

New listings and pending sales both took a jump upward in the week
ending June 6 as the annual post-Memorial Day surge in activity took
place. There were 1,226 signed purchase agreements in the Twin
Cities for the week, which represents a 33.4 percent increase over the
same week last year. The 2,160 new listings were a 4.3 percent
decline from a year ago but were a significant bump over the activity
seen during the Memorial weekend respite.

Complete Report: Housing Stats

The June Housing Affordability Index of 199 is down 20 points over the
last two months due to recent rises in mortgage rates and seasonal
increases in the region's median sales price. Combine that with a
steadily declining Months Supply of Inventory (7.6 months) and falling
Supply/Demand Ratio (5 homes per buyer), and it's clear that buying
conditions are not quite as friendly as they were a couple of months
ago, especially in the lower price ranges.

Regardless, there remains a hefty cadre of properties available for
purchase. And with the $8,000 federal tax credit spurring first-time
home buyer activity, this summer should be busy.

Complete Report: Housing Stats

Don't Believe the Good News?

www.go2joe.com

Recently there was an article on the web I ran across entitled "Housing sales up? Why that is bad news"

After reading this article I realized this is all part of the problem we all are in today. Negativity sells and is front page news, positivity is in the "E" section of the paper. Housing sales were up at twice the pace as last year at this time! Twice! This is bad news?

Here's the take on the article. The sales that have been happening predominately are foreclosures. They are discounted 30-40-50% and sometimes more of the value they once were. Some say this means nothing to the "real housing market" you and I live in. The foreclosures drive our prices down and cost us money. True. The values of all of our houses have dropped dramatically. The stock market quip is "my 401k is now a 201k". The economy is in a tail spin and we need to work hard and save hard to get through it.

Here's my positive spin for the eternal optimist I like to think I am. All of these foreclosures being sold create activity. They create money. Most often the homes that are sold by a bank need work. Real work. This includes plumbing, electrical, furnace, paint, carpet, roofing, siding, you get the picture. Now all these people fixing these homes purchase supplies from the local stores and hardware store. They use gas getting to and from the job sites. They have their coffee, and doughnut at the local store. They come back for lunch and have a burger, etc.

These hard working people also have kids like I do. Hockey, baseball, swimming, tennis, movies, and so on. Families take money to survive, and the money being made on these foreclosures is being put back into the economy just as fast as it was earned. This money flowing into the economy will eventually affect the job you are in right now. Whatever your company does, at some point will gain new sales from the new money flowing.

Look on the positive side. Foreclosures may be hurting your property values right now, but they also may be the answer to turning your 201k back into the 401k we all remember gazing at dreaming of early retirement it was so fat!

The next time someone says "yeah, but look at how the foreclosures are killing our economy", remind them of the positive side. The foreclosures are also turning our economy around!

-Joe Koltes 10/29/08