A number of real estate related articles caught my eye this past week that should have an impact on homeowners in the Twin Cities. They were articles about how flipping houses is making a comeback, a new program that President Obama is proposing dubbed “Cash for Caulkers” which is aimed at making homes more energy efficient and the most recent Twin Cities real estate statistics.
Flipping Makes A Comeback
Last week there was an article in the Wall Street Journal about how Flipping (the investment process of buying a home cheap, improving it quickly and selling it for a profit) is making a comeback – House Flipping Comeback
There is definitely an active group of investors that is both buying foreclosed properties to resell/flip and to purchase as rental units. Just last week I made an offer on a nice starter home in East Bloomington. There were 15 offers on the place – mine wasn’t nearly high enough. With the low prices in the market and interest rates below 5% this is a great time to buy rental properties so the flippers do have to compete on almost every low-priced property that’s listed.
Cash For Caulkers
Also last week, President Obama announced plans to support new legislation that would provide current homeowners with up to $12,000 in rebates for home improvement projects – Cash For Caulkers To Provide Up To $12,000
The program contains two parts: money for homeowners for efficiency projects, and money for companies in the renewable energy and efficiency space.
The plan will likely create a new program where private contractors conduct home energy audits, buy the necessary gear and install it, according to a staffer on the Senate Energy Committee and Nadel at the American Council for an Energy-Efficient Economy.
Big-ticket items like air conditioners, heating systems, washing machines, refrigerators, windows and insulation would likely be covered, Nadel said.
These rebates could definitely help sellers to get their homes into a more saleable condition if they are looking to sell or help homebuyers to upgrade a home they want to purchase.
Twin Cities Weekly Real Estate Statistics
The Minneapolis Area Association of Realtors released their Weekly Market Activity Report today for the week ending December 5th, 2009.
Activity was up from the previous week but is down 7.7% from the same period a year ago. We are seeing a slight slowdown in sales, most likely to the previous expiration of the First Time Homebuyers Credit which pushed a lot of activity through November and was scheduled to expire. While the credit did get extended it did pull activity forward into the fall time period which is slowing down a bit now and probably won’t pick back up until we get closer to the new expiration of April 30, 2010.
The most interesting metric from the report was the following one -
Months Supply of Inventory – At 5.7, this is the lowest MSI in more than two years and a full 32.9 percent below last year. This bodes well for sellers in general, but the higher price ranges are still buyer’s markets.
While most people agree it’s a buyers market there continues to be a big reduction in the number of homes on the market which is making this much more of a balanced market, especially in the lower price points.
Conclusion
It’s important to stay on top of the Twin Cities real estate market. House flipping & Cash for Caulkers are just 2 ways that investors and consumers can benefit from knowing what’s available to them. Let me know if you have any more detailed questions on taking advantage of them for your situation – Contact Bill
