A bunch of new info regarding the November Housing Stats was released by MAAR today. Here's the highlights:
With home prices in seasonal decline and mortgage rates dropping, the buying environment is as good as it’s been since February 2005, according to the Minneapolis Area Association of REALTORS® (MAAR) based on data from the RegionalMultiple Listing Service of Minnesota, Inc.
The MAAR Housing Affordability Index (HAI) increased to 141, the healthiest December HAI figure since 2003. The median sales price in November of $216,500 was 5.1 percent behind November of 2006, the largest such year-over-year decline in 2007. Since decreased affordability has been one of the leading causes of the current market malaise, these improvements bode well for the future.
Despite abundant inventory, motivated sellers and improving affordability, home buyers remain inactive. Newly signed purchase agreements (pending sales) posted 2,615 units in November, 21.0 percent behind November 2006. Similarly, closed sales declined by 19.3 percent for the same time period comparison.
The number of homes for sale has fallen by 4,000 units in the last two months. Despite the seasonal drop, inventory set a new November month-end record with 30,126 homes for sale and 13.44 homes for each buyer expected during the upcoming month.
• Declining home prices are often viewed as a negative phenomenon. In reality, lower prices bring attractive buying opportunities to the market and lay the foundation for a bright future.
• Right now, buyers are like awkward kids at a junior high dance—anxious and waiting for their favorite song. Meanwhile, the kids who recognize a good thing are already on the floor having fun.
• A revival in FHA loans, which had lost substantial market share to the risky subprime market, will provide funding for low-to-moderate income households at attractive rates.
• All of the conditions in our market are ideal for buying a home. Buyers who are waiting on the sidelines should seriously consider acting now. Otherwise, they might look back at this as a time of missed opportunity.
• Positive changes are still taking place. Affordability is improving, the lending environment is returning to solid fundamentals, interest rates are still historically low, and buyers now have a golden opportunity to purchase a home.
• Real estate is a cyclical business and fall is historically a slower time in our housing market.
• Sellers face a challenging market right now. But if you’re a first-time home buyer or a second-home buyer with no home to sell of your own, the market has been with opportunities.
• Downward pressure on home prices will continue into early next year as record inventory competes for a declining buyer pool.
• A quick and easy rebound in sales is not in the cards—our market’s recovery will be slow to start and gradual in its effect.
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