The foreclosure crisis in Minnesota is nearing an end, but communities of color are still struggling to keep pace with the recovery. That's according to an annual report released this morning by the Minnesota Homeownership Center, which provides homeownership counseling, foreclosure prevention service and other support to Minnesota homeowners.
For example, in North Minneapolis prices have fallen so far that a homeowner who bought in 2006 at the neighborhood’s median price would need to see their 2013 home value increase by 85 percent to return to its purchase price. On the other hand, in Southwest Minneapolis, house prices have risen to pre-crash levels.
“This report gives us a clear understanding of how homeownership impacts communities – from safe neighborhoods and engaged citizens, to better educational achievement and health – as well as the barriers and opportunities that will influence our next generation of homebuyers,” said Julie Gugin, executive director of the Minnesota Homeownership Center.
This June, the Minnesota Homeownership Center and its network of nonprofit partners, the Homeownership Advisors Network, will offer free homebuyer education to potential homebuyers
Click here for info.
Is the housing market crashing? (Again?). In recent months there's been considerable and growing concern about whether weak year-over-year home sales in the Twin Cities and beyond portends an end to the housing recovery.
This week, in the latest weekly home sales summary from the Minneapolis Area Association of Realtors (MAAR), I spotted a bit of data that suggests otherwise: After six months of monthly, year-over-year declines in closings, there was a 0.1-percent increase in pendings for the week ending 5/10/14. That followed a a 0.7-percent gain for the week ending 4/12/14. Though not every inked deal makes it to the closing table, pending sales are an important indicator of future closings.
MAAR's data contains other clues that market fundamentals are improving in a quiet, but meaningful way. Specifically, the decline in closings is the result of dramatic weakness in foreclosures and short sales at a time when traditional buyers are stepping into the market at increasingly brisk pace. MAAR's data guru, David Arbit, said that during May, for example, traditional pending sales have been 21 percent higher over the past 12 months, while there has been 32 percent fewer foreclosure sales and 44 percent fewer short sales. The same thing happened during April.
The decline in foreclosure sales has triggered another interesting trend: There's been a dramatic decline in sales of homes priced under $150,000 and substantial increases in home sales priced above $150,000. Arbit said there were nearly 4,300 fewer pending sales priced under $120,000 during the 12-month period ending April 2014. "When you take out that many sales (many of which were distressed), the overall sales pie can shrink. But those sales represented a bitter and unwanted slice of the pie to begin with. Even so, when you get rid of that rancid slice, the overall pie does shrink but it also becomes a better, healthier pie." Anyone hungry?
Fast-fashion retailer H&M (short for Hennes & Mauritz) is opening a new store in Burnsville Center. Look for it this fall. The opening is part of a broader expansion by the Swedish company “in the North,” according to a news release Monday.
The 18,000-square-foot Burnsville store will feature clothing for women, men, young women and young men (or “young ladies and young men,”) kids, and a stores-within-the store for accessories, lingerie, maternity and plus-size. Since opening its first state-side store on Fifth Avenue in New York 14 years ago, H&M has expanded rapidly with some 311 stores nationwide.
Stores locally include Mall of America, Calhoun Square, Southdale, Maplewood, Woodbury Lakes and Ridgedale.
The delinquency rate for residential mortgage loans at the end of the first quarter in Minnesota was 3.76 percent, a decrease of 76 basis points from the fourth quarter of 2013, according to a national survey by the Mortgage Bankers Association (MBA).
The rate excludes loans in the process of foreclosure, but the percentage of loans in the state on which foreclosure was started was also down, falling 11 basis points to 0.28 percent, while the percentage of loans in the foreclosure process at the end of the quarter fell 16 basis points to 1.01 percent.
Across the nation, the average delinquency rate was 5.69 percent, down 102 basis points from 6.71 percent in the fourth quarter of 2013. Among the 50 states and the District of Columbia, Minnesota ranked 44th in delinquencies and 41st in foreclosures started. Mississippi ranked first in delinquencies with a rate of 10.46 percent and New Jersey ranked first in foreclosure starts with a rate of 1.06 percent. .
It's been a less-than-stellar spring housing market in many parts of the Twin Cities, but the recovery marches on, though at a more moderate pace than last year. Here's a look at what happened during April, according to a monthly sales reports released this morning by the Minneapolis and St. Paul Area Associations of Realtors.
Stay tuned for a full report in the Tuesday paper.
One third of all home sales in Minnesota during the first quarter were paid for with cash - a significant increase over last year, according to a new survey by the National Association of Realtors. That increase, in Minnesota and across the country, is somewhat perplexing to the experts. From January through March in Minnesota, 34 percent of all sales were cash compared with just 19 percent two years.
Last year many cash deals were foreclosures that were being bought be investors with plenty of money to spend, but those distressed sales have been waning. Lawrence Yun, NAR's chief economist, said the findings are counterintuitive.
“Distressed home sales, most popular with investors who pay cash, have declined notably in the past two years, yet the share of all-cash purchases has risen,” he said. “At the same time, investors have declined as a market share, indicating other changes have been underway in the marketplace.”
Those distress sales declined from 26 percent of the national market in 2012 to 17 percent in 2013 and 15 percent in the first quarter of this year; NAR projects distressed homes to drop to a single-digit market share by the fourth quarter. All-cash purchases rose from 29 percent in 2012 to 31 percent in 2013 and 33 percent in the first quarter of 2014.