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Real Estate Sale Prices on the Rebound in Eagan, Twin Cities Region

In Eagan, the median sales price for homes sold in the first eight months of 2012 is up 10.1 percent compared to the same period in 2011.

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Real estate is on the rebound.

The Minneapolis Area Association of Realtors (MAAR) announced last week that for the sixth consecutive month, local real estate prices were up in August on a year-over-year basis. The median price, regionwide, was up 15.5 percent from the same month last year, to $179,000. And the average sales price was $222,922, up 10.4 percent and marking the seventh consecutive month of annual increases.

Even in the boom period from January 2003 to January 2004, median prices in the Twin Cities area were only increasing by about 7 percent a year.

In Eagan, the median sales price for homes sold in the first eight months of 2012 stands at $188,300, up 10.1 percent from the median sales price for the same period in 2011. The number of closed sales in Eagan has jumped from 527 in the first eight months of 2011 to 617 in the same period in 2012—a 17.1 percent increase.

The number of days a home stays on the market before selling has also dropped from 134 to 105, according to the MAAR's most recently market update for Eagan.

Regionwide, nearly every housing market measure has indicated improvement for at least six months now. In August, for instance:

  •  There were 4,877 pending sales, up 19.5 percent and marking the 16th consecutive month of increase.
  • There were 4,883 closed sales, up 12.3 percent, marking the 14th consecutive month of increase.
  • In June 2012, closed sales fell just six  units short of a nearly six-year high.

Part of the reason for rising prices is supply, which has declined compared to demand. In August, there were 16,348 homes for sale, down 30.5 percent from the same month last year and marking the 19th consecutive month of decreases. Inventory levels are at their lowest since the hot market of December 2003, a nearly nine-year low.

Inventory levels, in fact, have come down a total of 54.5 percent from their July 2007 peak, when the market was at its worst.

"With inventory levels nearing 10-year lows, buyers are scrambling to find the perfect house," said Cari Linn, MAAR’s president. "The next step of recovery will be getting hesitant … sellers back into the market."

Also, the “distressed” market is making less and less of an impact on Twin Cities area home prices; in August, foreclosures and short sales comprised less than a third of the new listings, a far lower rate than was seen during the depths of the area’s real estate downturn.

Paul September 19, 2012 at 12:22 AM
If property values are indeed increasing, I don't yet see it reflected in anything. Worse, I'm no longer sure I want my property value to go back up. My taxes have been increasing even while my property values declined, because those in government think that their incomes need to be unaffected even while the tax-paying base is hit hard. Because tax rates increased while property values decreased, I fear for how much my taxes will jump, whenever property values actually do start back up towards where they were in 2008. I guess the solution to increasing property values in a way that doesn't stiffle potential economic growth, is that we just need more libertarians and conservatives in city and county government, and a lot fewer liberals at all levels of appointive and elective government.

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