Weekly Market Activity Report

New Listings for the week ending April 16 were down 21.5 percent from the same week in 2010 to 1,846 properties. That's a smaller decline than the 3-month average, which is down 26.4 percent. It appears that year-over-year declines in listing activity peaked around the end of March when motivated sellers were eager for buyers to consider their properties during the run-up to the end of last year's tax credit deadline.
Pending Sales, too, predictably fell short of April 2010's credit-inspired five-year high-water mark. The 898 purchase agreements signed were 18.6 percent fewer than last year. That's on-par with the 17.6 percent 3-month average decline. Purchase demand is currently the highest it's been since the week ending May 8, 2010. Sales activity in 2010 peaked during the week that ended April 25 and then fell sharply, so we can expect a very different story in two weeks.
The winner is still inventory, which plunged by 15.4 percent from the same week in 2010. It's worth noting that the number of active listings for sale ballooned at this time last year as sellers moved to take advantage of the increased buying activity. Notwithstanding, we haven't seen declines of this magnitude in nearly 15 months. It's a trend that will mean fewer options for buyers as well as improved market balance.

Monthly Skinny: April 2011

Take a listen to this 3 minute video for the latest "The Skinny" on the Twin Cities real estate market.

Weekly Market Activity Report
Daylight hours may be increasing but contrary to seasonal norms, the number of homes for sale continues to remain about the same. There are now 22,449 active listings in the Twin Cities, 14.4 percent fewer than last year. Nine consecutive weeks of year-over-year inventory decline bring a number of implications—mostly good, some not so good.
On the good side, sellers have fewer properties to compete with. This should quicken market times and increase seller leverage at the closing table. Improving demand with unchanging supply has the tendency to lift prices. On the not-so-good side, buyers have fewer options than in recent years. In light of skyrocketing affordability, historically low interest rates, foreclosure bargains, favorable negotiations and low prices, buyers are still proving to be either very patient, highly cost-conscious or both. Even so, purchase demand has more or less kept pace with non-incentivized 2009 levels.
New Listings decreased for the 14th consecutive week, dropping 19.2 percent to 1,738 properties. Pending Sales hit their highest weekly total this year but still trail last year's pace, down 25.1 percent year-over-year to 840 purchase agreements signed.

There's been a lot of talk regarding Shadow Inventory.  That is inventory that isn't currently on the market, but is either foreclosed on & the bank is holding the properties, waiting for an improved market, or inventory that is in the process of foreclosure.  Too much Shadow Inventory will definitely impace the recovery of the housing market in the next several year. Let's hope that the Shadow Inventory continues to decline.

Shadow Inventory Declines, But Supply Still High
As of January 2011, the number of residential properties in shadow inventory fell to 1.8 million residential properties, representing a nine months’ supply, down from 2.0 million units from a year ago, also a nine months’ supply, according to CoreLogic. Of the current shadow inventory supply, 870,000 homes are seriously delinquent and 470,000 are bank-owned. Accelerated loan modifications and short sales can help reduce the inventory of distressed properties, say economists at CoreLogic.

In addition to the current shadow inventory, nearly 2 million current negative-equity loans are more than 50 percent “upside down” and will likely become shadow supply in the future. New Jersey, Illinois and Maryland have the highest levels of shadow inventory while North Dakota, Alaska and Wyoming had the lowest.

Council of Residential Specialists  Fri, Apr 1, 2011