A look at 2011 real estate and what we have in store for 2012

February 3, 2012

We thought we hit bottom in 2010, 2011 was supposed to be the turning point for real estate values and as we take a look back we find political gridlock consumed by credit downgrades, financial volatility and a sluggish job market. This is not what we needed for a turnaround in real estate.  As seen, the housing sector in particular did not see the recovery forecasted by real estate agents and analysts alike.  It was another transition year as house values continued to decrease, median sales price of homes dropped from $169,000 to $150,000 and days on market of MN homes for sale increased from 133 days to a an astounding 148 days.

On the other hand, not all was negative.  For both Minneapolis buyers and sellers there were is something to get excited about.  We have seen a decrease in new listings from 81,846 in 2011 to 68,875 and an increase in closed sales from 38,283 in 2010 to 41,429 in 2011.  This tells us that housing supply is below housing demand signaling a positive outlook or a potential swing in the trend we have seen over the last few years.

Take a look at the chart below, you will notice that new listings are down year over year, closed sales are up from 2010 and inventory is down.

New Listings, Closed Sales and Inventory from 2009 -2011:

Sold Homes and New Listings Data

We see here that supply is down and demand is up from 2010 to 2011.  One would then think that prices of homes for sale would increase, which signals a recovery.  The numbers show me that the housing market could be ready to make its return.

Also take a look at total closed sales for the calendar year 2011 by city:

Total Closed Sales Change from 2010
Twin Cities Region

41429

8.2%

Albertville

25

25.0%

Andover

363

-8.8%

Anoka

73

-1.4%

Apple Valley

721

21.5%

Arden Hills

68

14.3%

Blaine

957

17.0%

Bloomington

860

5.8%

Brooklyn Park

510

16.4%

Burnsville

764

27.5%

Chanhassen

370

23.3%

Chaska

282

-5.1%

Coon Rapids

894

19.8%

Cottage Grove

440

5.0%

Crystal

329

21.9%

Deephaven

49

-10.9%

Eagan

796

22.7%

Eden Prairie

755

11.4%

Edina

695

4.7%

Excelsior

27

125%

Forest Lake

281

12%

Fridley

267

30%

Golden Valley

270

39%

Hopkins

168

-10%

Inver Grove Heights

311

12%

Lakeville

761

4%

Lino Lakes

198

4%

Long Lake

17

-23%

Maple Grove

1008

7%

Medina

53

10%

Minnetonka

652

12%

Minneapolis – City Wide

4378

0%

Minneapolis –  Calhoun Isles

315

18%

Minneapolis – Camden

597

-6%

Minneapolis – Central

449

0%

Minneapolis – Longfellow

295

8%

Minneapolis – Near North

362

-18%

Minneapolis – Nokomis

569

2%

Minneapolis – Northeast

406

8%

Minneapolis – Philips

79

-26%

Minneapolis – Powderhorn

466

-2%

Minneapolis – Southwest

681

6%

Minneapolis – University

154

-6%

Mound

153

-4%

New Brighton

174

15%

New Hope

205

13%

Orono

132

0%

Plymouth

933

17%

Richfield

455

26%

Robbinsdale

208

17%

Roseville

308

10%

Shakopee

624

50%

St Louis Park

687

33%

St Paul

3025

1%

Wayzata

57

8%

Are you in the market to buy a new home right now? With mortgage rates still at historic lows and the housing market potentially moving in an upward swing, right now may be the time to make your move.

What do you think is going to happen in 2012?