According to new figures released by the Minneapolis Area Association of REALTORS® (MAAR), the Twin Cities housing market continued to see its inventory of available homes drop at breakneck levels in October. The number of properties currently available in the Twin Cities metro area has dropped to 21,145, the lowest October mark since 2004 and a decline of more than 6,000 listings from this time last year.
Eagan figures mirrored the area-wide figures experiencing a 32.6 percent decline in October, 2011 inventory as compared to October 2010. According to the MAAR report, there were 312 homes available for sale in Eagan this October compared with 463 last year.
The drop in supply is due to a combination of weak seller activity and strong buyer activity. New Listings were behind last October's pace by 16.3 percent, while Pending Sales were up 34.6 percent.
"It's something of a fallacy to call this a buyer's market," said Brad Fisher, President of the MAAR. "Good quality homes that are priced right are in short supply. Buyer demand exists, but we need more sellers in the game."
In 2007, the Twin Cities housing market had the opposite problem, when there was a rather sizable oversupply of properties available.
Foreclosures and short sales remain a high proportion of the local housing market according to the report. In October, 43.5 percent of pending sales were lender-mediated, up slightly from the prior month. There is currently 2.0 months of foreclosure supply, 13.1 months of short sale supply and 7.5 months of traditional, non-lender-mediated supply.
Eagan’s inventory plummeted to 4.8 months’ supply for October, 2011 compared to 8.9 months of inventory supply in October, 2010. Buyers being more active accounts for some of the reduced inventory in Eagan. A total of 78 home sales were closed this October compared to 49 in October, 2010, an increase in closed sales of 59.2 percent.
The improving supply-demand balance means that sellers are starting to receive closer to their original asking price for the third consecutive month – up over last year to 91.2 percent. In a related story, the average market time in October was slightly lower than the prior year for the first time since last August.
The average median sales price of homes in Eagan rose 7.7 percent to $181,000 in October, 2011 compared to $168,000 in October, 2010. The Year-to Date average median sales price in Eagan is $175,000. That figure is still down 7.2 percent from the previous year pace.
"We believe that many consumers are playing a waiting game for their home values to improve before considering selling again," said Cari Linn, MAAR President-Elect. "That's certainly a logical decision, especially as winter approaches, but there's a lot less competition for buyers than there used to be."