Builders sought applications to build fewer apartment buildings, but more single-family houses during November, according to data compiled by the Keystone Report for the Builders Association of the Twin Cities (BATC). This month builders were issued 419 permits to build 646 units compared with the same four week period last year.
That was a nearly 50-percent drop in planned units, but a 4-percent increase in single-family homes. Construction activity so far this year is still on pace to exceed last year by 25 percent, and the region has issued permits for more units than any year since 2006. During the first 11 months of the year, builders have been issued 4,941 permits to build 9,292 units.
“Most of our members had been preparing for a relatively flat fourth quarter 2013 and first quarter 2014," said Pamela Belz, Builders Association of the Twin Cities 2013 president and developer with Senior Housing Partners. "We’re optimistic that by second quarter 2014, and maybe sooner, the market will be on the rise.”
Minneapolis issued the most permits with 212 units. Blaine came in second with 41 units, followed by Lakeville with 34 and Otsego with 33. Woodbury rounded out the top five with 26 units permitted.
Here's a link to the full report.
These are confusing days for anyone for clear signals from the housing market. A flurry of reports released this week shows what appears to be conflicting trends. Here's a summary of those reports:
With pending sales falling, home prices rising and home building on the upswing, what's a news junkie to make of these numbers? The housing market is in the midst of a seasonal slow-down exacerbated by the government shut-down and higher mortgage rates. Indeed, low inventory is putting upward pressure on home prices - and the demand for new houses. But the unusually strong price gains are more a reflection reflection of mid-summer investor purchases and big declines in foreclosure sales.
Here's a very good summary of the situation from David Blitzer, chairman of the index committee for Case-Shiller: "Housing continues to emerge from the financial crisis: the proportion of homes in foreclosure is declining and consumers’ balance sheets are strengthening. The longer run question is whether household formation continues to recover and if home ownership will return to the peak levels seen in 2004.”
Christian Ponder's million-dollar Minnetonka manse has a buyer, but the deal has just gone pending, so we don't yet know the name of the buyer, who stepped forward just two weeks after the house hit the market. Jeffrey Dewing of Coldwell Banker Burnet is the listing agent, here's a link to his website, which includes more details and photos of the house.
Sales of upper-bracket houses are rise in the Twin Cities metro, especially around Lake Minnetonka where listings are relatively tight and there are a limited number of homes with private lakeshore. Ponder paid $880,000 for the pad in July 2012, according to property records, but the sale price won't be public until the deal closes. Annual property taxes for the property are $18,515. Here are some highlights:
Minnesota is following the Twin Cities and the rest of the nation with a fall dip in home sales. That's according to new data from the Minnesota Association of Realtors, which shows that were 6,599 home closings during October, down 2.2 percent compared with last year. Low inventory, fewer foreclosure sales and an increase in more expensive sales helped boost the median prices of those sales to $175,000, a 12.2-percent increase over last year.
Also on Friday, the National Association of Realtors said that existing home sales nationwide were down 3.3 percent to a seasonally adjusted annual rate of 5.12 million sales compared with September, but 6.0 percent higher than last year. Sales were down for the second month in a row.
The trends were similar in the Twin Cities metro, according to a report released earlier this month
Agents blame the slowdown on higher mortgage rates, the government shut-down and the approach of winter. Lawrence Yun, NAR's chief economist, said the declines have been no suprise. "Low inventory is holding back sales while at the same time pushing up home prices in most of the country." More new construction is needed to help relieve the inventory pressure and moderate price gains."
Across the country, bidding wars are waning, but they still happened on more than half of all deals consummated by Redfin agents in 22 major markets.
The monthly Bidding War Report showed that during October, 55.9 percent of offers written by Redfin agents faced bidding wars, down from 58.3 percent in September. It was the 7th month in a row that Redfin showed a month-over-month drop in competition. October also was the third consecutive month to see competition fall below 2012 rates.
Redfin predicted the decline given the U.S. government shutdown and a decline in consumer confidence.
Here's what Redfin economist Ellen Haberle had to say about the situation: "This reprieve is unlikely to last much longer; as soon as the clock strikes midnight on New Year's Day, competition probably will reverse course as the 2014 selling season takes off."
Competition in Boston declined the most, with 61.3 percent of all offers facing bidding wars, down from 70.1 percent the previous month, and competition was most fierce in San Diego where 63 percent of all offers involved more than one bid.
Twin Cities-based HomeServices of America, Inc. said that after a decade-long courtship, the company has acquired Prudential Rubloff Properties, one of the leading brokerages in the Chicago market.
Speaking from Chicago where he announced the deal, HomeServices CEO, Ron Peltier, said Prudential Rubloff Properties and its subsidiaries will merge with Chicago area brokerage Koenig & Strey Real Living Real Estate, which HomeServices acquired in September 2009. Next spring those combined companies will become Berkshire Hathaway HomeServices KoenigRubloff Realty Group.
Terms of the deal, which includes the company’s subsidiaries, Rubloff Insurance and Sterling Title Services LLC, were not disclosed, but the deal will create a single company that will have nearly 1,600 agents and staff in the Chicago metropolitan area. Last year, the combined firm closed more than $4 billion in sales volume.
The company is expected to be the second-largest brokerage in that market, and it's a deal that Peltiering has been trying to put together for more than a decade, and it follows several acquisitions already this year.