The Minneapolis Association of Realtors released their Weekly Market Activity Report today and for the 15th straight week the Twin Cities real estate market has seen significantly less transactions than a year ago. We continue on a pace of an approximately 40% sales decline from last summer, even while interest rates continue at record low levels.
For 12 consecutive weeks now, the number of homes for sale in the Twin Cities housing market has been higher than it was a year ago, and the gap between this year’s inventory and last year’s inventory at the same time has been steadily growing. There are currently 27,784 homes for sale, up 8.1 percent from this time in 2009. Inventory is not growing due to an influx of new sellers putting their homes on the market. Rather, its growing due to a drop in buyers who once were absorbing supply.
For the week ending August 21, there were 601 signed purchase agreements, down 40.6 percent from a year ago. That’s the 15th consecutive week of significant declines compared to a year ago.
With supply growing and fewer buyers to purchase it, home sellers can expect a challenging fall and downward pressure on home values. Motivated sellers who want to move quickly may have to pursue aggressive pricing to attract buyers.
With the end of the summer home buying season just about over one has to wonder what this fall is going to bring. One thing is for certain, there aren’t many buyers out there and those sellers are facing even further drops in house values and longer time on market.
