As anticipated, lack of new listings which is resulting in a lack of listing inventory continues to be the factor that is most affecting residential real estate in the Twin Cities heading in the spring market of 2013. Buyer demand is high, listing supply is low. This market imbalance has slowed the housing recovery, but has not stifled it. An example of this is that while new listings (-9.6%) and closed sales (-4.7%) lagged behind February 2012 numbers, pending sales (+2%) and median sales price (+15.5%) were up in February 2013.
Another interesting development is the shift in properties that are being listed. In the recent past, the majority of the homes being listed were “distressed properties”. These are homes that are either foreclosures or offered for sale as short sales. That trend has reversed, last month 72.3% of new listing were traditional listing (non-distressed). The average sales price of distressed properties is significantly less than a traditional listing. Last month, the median sale price for a foreclosure was $116,522; a short sale was $127,750 while a traditional sale was $205,500. This shifting of listing composition is one of the reasons for the increase in median sales price.
I hope you enjoyed this installment. Stay tuned until next month. We are in a dynamic market and want to keep you informed. Thanks for reading.