The red line on the chart above shows the number of homes that were listed for sale through the Regional Multiple Listing Service (MLS) each week since the beginning of the year. The blue line shows how many homes had offers made on them that were accepted by the sellers during the same week. Some of the homes have closed and some have not. Pending sales and listings are a metric used to measure the health of the real estate market. Real estate is local and these numbers are for St. Paul Minnesota.
There are a couple of weeks where there were more offers than new listings and for the first time in a long time the number of offers hit the triple digits a few times. We have had many weeks where we hit the triple digits for listings but not for offers.
A few months ago I wrote about how in 2007 the trend lines were going in opposite directions. The number of listings was increasing and at the same time there were fewer offers on homes. Now the lines are meeting and the blue line is at a steeper pitch than the red. The number of listings has been leveling off while offers increase.
There are about half as many homes on the market in St. Paul as there were last August of 2008, and slightly fewer than there were in April of 2009. The inventory of homes on the market has been decreasing for months, fewer are being listed and more are being purchased.
What does this all mean? I have some theories. lets just say that there are people who want to sell and can not and there are people who are a couple of months behind on their mortgage payments who are exploring their options. There will be more foreclosures and that will bring the inventory up. Will there be enough buyers to absorb it or are we just seeing a little spring buying activity fueled by pent up demand, tax incentives and oh so low interest rates?
For more local monthly numbers see local market conditions
I keep hearing about first-time home buyers getting really good deals. Where can I find more info about it?
I am in Minnesota, and people (non-home buyers) are telling me they can get super-good interest rates, no money down to buy, not have a stable job, and get a loan for 120k. Can this be real? I have tried looking everywhere I can think of online to find info about this, but it seems to be hidden, if it is there. Please provide me with a link. Thanks!
I hope the banks reading your blog don’t think they can start playing new games with the market now.
I’m curious about your numbers in terms of short sales. Many banks wont accept hardship packages/short sale offers unless there are more than one offer on a house. Does “accepted by the sellers” mean accepted by banks in the case of short sales? I am trying to (short) sell my house and I have accepted two offers, but both walked away because banks never responded.
With the foreclosure process on hold for many banks at the beginning of the year, there will be another foreclosure spike coming soon.
I’m sorry to be so pessimistic, but I am knee deep in the mud.
That is wild to see the line meet. We are not doing that well but Bergen County New Jersey has improved a lot. To see the constant growth in offers is very warming. I hope we can hold up over the rest of the year.
Looks like you have a healthy market! Nothing like having more offers than products to sell!
The bank’s see the good signals from Mr. Obama with different types of tax credit, first time buyer money and the Governments money to save the bank and finance system. So of coarse the banks want so good offer as possible before they accept a credit lost.
Hi Teresa,
I agree with all your observations, except one. I heard that banks are starting to hold on to their foreclosed inventory in anticipation of the bottom. If this trend continues then I don’t think we’ll see the market weaken due to a foreclosure pricing….
Just for context, I write a blog on San Diego Property Management
Historically, market bottoms occur after even the most ardent people throw in the towel.
Right now, the government is driving down interest rates and giving away a tax credit for new buyers.
Even with all that, prices are flat or declining.
What happens when the current round of solvent buyers gets used up and when they can no longer hold down interest rates?
A $30k tax credit?
Maybe…
This graph is an incredible tool for gauging the health of a market. Very well done!