A free research tool from the Minneapolis Area Association of REALTORS brought to you by the unique data-sharing traditions of the REALTOR community

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1 A free research tool from the Minneapolis Area Association of REALTORS brought to you by the unique data-sharing traditions of the REALTOR community Buyer activity took another step up in as the final days of the federal tax credit for first-time buyers ticked toward a November 30 deadline, contrary to the typical slowdown. There were 4,986 signed purchase agreements during the month, up 23.5 percent from a year ago the 15th consecutive month of year-over-year increases in pending sales. Since first-time home buyers don t typically go high end, a healthy portion of these sales are taking place in price ranges below $200,000. The influx of new buyers has helped home prices grow over the course of the year. The median sales price of $170,000 represents a slight dip from the prior month, but the dip is much less extreme than typical. Compared to last, it s a 10.5 percent decline the lowest year-over-year decline in 17 months Contents New Listings Pending Sales Closed Sales Dollar Volume of Closed Sales (in millions) Median Sales Price Average Sales Price Total Active Listings Available Percent of Original List Price Received at Sale Mortgage Rates Supply-Demand Ratio Housing Affordability Index Months Supply of Inventory Market Overview Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union

2 New Listings Year to Date 8,027 7,689 7,328 86,401 76,726 68, % % - 8.7% % 12,000 10,000 Historical Market Activity New Listings Pending Sales Closed Sales 8,000 6,000 4,000 2,000 0 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 2

3 Pending Sales 4,036 4,036 4,986 4,986 January through Year to Date 35,588 35,162 35,588 35,162 41,811 41,811 2,839 2, % % % % 12,000 10,000 Historical Market Activity New Listings Pending Sales Closed Sales 8,000 6,000 4,000 2,000 0 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 3

4 Closed Sales 4,202 4,216 4,202 4,216 January through Year to Date 31,855 31,855 29,835 29,835 33,321 33,321 3,116 3, % % % + 4.6% 12,000 10,000 Historical Market Activity New Listings Pending Sales Closed Sales 8,000 6,000 4,000 2,000 0 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 4

5 Dollar Volume of Closed Sales (in millions) January through Year to Date $847.4 $847.4 $965.8 $965.8 $863.8 $863.8 $8,815.1 $8,815.1 $7,243.2 $7,243.2 $6,624.5 $6, % + 1.9% - 8.5% % $2,000 Historical Dollar Volume (in millions) $1,700 $1,400 $1,100 $800 $500 $200 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 5

6 Median Sales Price $225,000 $225,000 $189,900 $170,000 $189,900 $170, % % $250,000 Historical Median Sales Prices $225,000 $200,000 $175,000 $150,000 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 6

7 Average Sales Price $271,942 $271,942 $229,831 $229,831 $204,874 $204,874 January through Year to Date $276,725 $276,725 $242,775 $242,775 $198,808 $198, % % % % $300,000 Historical Average Prices $275,000 $250,000 $225,000 $200,000 $175,000 $150,000 Jan 00 Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 7

8 Total Active Listings Available 34,042 34,042 30,901 30,901 24,687 24, % % 40,000 Historical Inventory Count 35,000 30,000 25,000 20,000 15,000 10,000 Mar 04 Mar 05 Mar 06 Mar 07 Mar 08 Mar Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 8

9 Percent of Original List Price Received at Sale 94.2% 100% 92.2% 93.9% The Percent of Original List Price Received at Sale is calculated by comparing the final sales prices of closed sales to their original list prices. This does not account for list prices from any previous listing contracts. 95% 94.2% 92.2% 93.9% 90% 85% 80% 100% + 1.8% - 0.3% Historical Percent of Original List Price Received at Sale 95% 90% 85% 80% Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 9

10 Mortgage Rates October Mortgage rate information is gathered from HSH Associates Financial Publishers, Inc ( Data represents 30-year fixed-rate mortgages in the Twin Cities region Historical Interest Rates 7.0 Nation Twin Cities Jan 01 Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 10

11 Supply-Demand Ratio October The Supply-Demand Ratio (SDR) is calculated by comparing the number of homes for sale at the beginning of each month with the number of total pending sales for the month. The higher the SDR, the more supply there is relative to demand. Number of Active Listings for Each Buyer Historical Supply-Demand Ratio % % Mar 04 Mar 05 Mar 06 Mar 07 Mar 08 Mar Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 11

12 Housing Affordability Index October Note: The HAI formula measures housing affordability for the Minneapolis/St. Paul market. An HAI of 201 means the median family income is 201% of the necessary income to qualify for the median priced home using a 20% down payment, 30-year fixed mortgage % % 220 Historical Housing Affordability Index Jan 02 Jan 03 Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 12

13 Months Supply of Inventory October The market is considered balanced between buyers and sellers when there is roughly a 5-month supply of homes available for purchase % % 11 Historical Housing Supply Outlook Sep 04 Sep 05 Sep 06 Sep 07 Sep 08 Sep Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 13

14 Market Overview Percent Change 5-Year Average Year-to-Date Year-to-Date Percent Change 5-Year Yearto-Date Average New Listings Pending Sales Closed Sales Dollar Volume of Closed Sales (in millions) Median Sales Price Average Sales Price Total Active Listings Available at Month End Percent of Original List Price Received At Sale Jul 7,669 8, % 8,887 53,792 61, % 63,356 Aug 7,154 7, % 8,766 60,946 69, % 72,122 Sep 7,328 7, % 8,248 68,274 76, % 80,370 Jul 5,174 4, % 4,858 31,928 26, % 32,178 Aug 4,897 4, % 4,785 36,825 31, % 36,964 Sep 4,986 4, % 4,118 41,811 35, % 41,081 Jul 5,235 4, % 4,957 24,533 21, % 26,368 Aug 4,572 3, % 4,959 29,105 25, % 31,327 Sep 4,216 4, % 4,167 33,321 29, % 35,495 Jul $1,079.7 $1, % $1,290.6 $4,809.7 $5, % $6,702.3 Aug $951.1 $ % $1,302.4 $5,760.7 $6, % $8,004.7 Sep $863.8 $ % $1,053.4 $6,624.5 $7, % $9,058.1 Jul $171,000 $208, % Aug $175,000 $200, % Sep $170,000 $189, % Jul $206,251 $250, % $260,380 $196,049 $245, % $252,366 Aug $208,022 $241, % $259,898 $197,930 $244, % $253,581 Sep $204,874 $229, % $252,980 $198,808 $242, % $253,457 Jul 25,862 33, % Aug 25,407 31, % Sep 24,687 30, % Jul 94.0% 92.6% + 1.5% 95.5% 91.7% 92.0% - 0.3% 95.0% Aug 94.1% 92.7% + 1.5% 95.3% 92.1% 92.1% - 0.0% 95.1% Sep 93.9% 92.2% + 1.8% 94.8% 92.3% 92.1% + 0.2% 95.1% Mortgage Rates Aug % 6.3 Sep % Oct % 6.2 Supply-Demand Ratio Aug % (Homes for Sale Per Buyer) Sep % Oct % Housing Affordability Index Aug % 145 Sep % Oct % 152 Months Supply of Inventory Aug % Sep % Oct % 2009 Minneapolis Area Association of REALTORS, Inc. Sponsored by Royal Credit Union 14