Edina, Minn. - Nov. 3, 2014 – Edina Realty, a Berkshire Hathaway affiliate, offers several tips for anyone thinking about buying a home this fall.
The current fall market offers distinct advantages for homebuyers as they enjoy a stronger bargaining position and more moderate housing prices. The recent seller’s market, which spawned fierce competition for a limited number of desirable homes, may be behind us, say Edina Realty experts.
Price increases have leveled off in recent months. Last year, at the height of the seller’s market, median sales prices were up a staggering 17 percent, while this fall, median sales prices are up just 5 percent according to the Minneapolis Area Association of REALTORS® (MAAR).
“Some might see these slowing prices as signs of an upcoming buyer’s market,” said Greg Mason, president and CEO of Edina Realty Home Services. “The reality is that we are now headed toward a moderate, balanced market.”
“First-time buyers have a better chance of purchasing a home now that bidding wars are receding and supply constraints have significantly eased in many parts of the country,” said Lawrence Yun, chief economist for the National Association of REALTORS®.
Homebuyers can still take advantage of low interest rates; however, market experts believe rates will begin rising. If you purchase a home before rates increase, you get more house for your money. For example, homebuyers with good credit could secure a monthly mortgage payment around $1,250 on a $350,000 home with 20 percent down. But if rates increase one percent, that monthly payment would go up by over $150, adding up to an additional $58,000 in interest over the life of the loan.
Exactly five years ago, during the height of the market correction, nearly 50 percent of pending sales in the 13-county metro area were short sales or lender-owned sales. Since then, the number of so-called distressed sales has dwindled to only 18 percent. Put simply, there are less bargains on the market as the quality of the housing inventory has risen. But that’s good news for anyone selling a home.
“Sellers are finally feeling more confident and are listing their homes in greater numbers,” Mason said. New listings in the Twin Cities metro area were up 7.2 percent in September over last year, and when distressed properties are removed, traditional home listings were up nearly 18 percent, according to MAAR statistics.
“The added inventory of homes for sale is a welcome relief to buyers who spent much of 2012 and 2013 scrambling to put in a competitive offer on the limited number of desirable homes on the market,” Mason said.
Despite nearly three years of rising sales prices, home affordability has remained relatively stable. Minnesota remains one of the most affordable housing markets in the country.
“The fourth quarter can be a good time to target serious, qualified buyers,” Mason said. “People actively looking for homes in fall and winter tend to be the most serious buyers who are intent on making a purchase.”
Potential homebuyers can map out the homes they want to view using Edina Realty mobile apps or the mapping functionality on edinarealty.com; open houses and new listings have a special flag.
For more information on the current state of the housing market and to see every property for sale in the area, visit www.EdinaRealty.com or call Edina Realty Customer Care at 952-928-5563.
Edina Realty is a Berkshire Hathaway affiliate and a wholly-owned subsidiary of HomeServices of America, Inc. It is one of the nation’s largest real estate companies with approximately 60 real estate offices and 2,300 REALTORS® throughout Minnesota and western Wisconsin. Edina Realty's family of companies includes Edina Realty, Edina Realty Title, and Edina Realty mortgage. Edina Realty closed nearly 29,000 real estate transactions and more than $6.9 billion in sales volume in 2014. For more information, visit www.edinarealty.com or find us on Facebook: facebook.com/EdinaRealty; and Twitter: twitter.com/Edina_Realty