Wondering just where this market is heading? Well the Minneapolis Area Association of Realtors just released this statement regarding current market conditions.
“The song remains the same from week to week in the spring Twin Cities housing market. New listings are flat relative to the previous year while buyer activity declines further. New listings for the week ending May 19 were 0.7 percent behind this time in 2006, posting 2,656 new units. Of these new listings, only 301 were new construction, bringing the new construction share of our total current inventory to 16.1 % compared to 19.7 % one year ago. Newly signed purchase agreements (pending sales) were down 21.5 % from the same week last year, continuing the trend of significant declines seen in recent weeks.
The residential market discord reflects a period of widespread recalibration of home values, lending standards, housing affordability, supply-demand dynamics, and construction activity; and the climax of this is depressed consumer confidence relative to real estate. The frenzied boom we saw from 1998 to 2005 was so extreme that it necessitates the market correction currently underway. The uncertainty surrounding our shifting market causes angst for both consumers and REALTORS® alike, but the adjustments now taking place will inevitably lead to long-term health and stability to our market.”
So next time you read about how the sky is falling for real estate, just remember that this, too, will soon pass. Sooner than later, all will be right again in the wonderful world of real estate!