Twin Cities housing market

“Dog Years” and Days on the Market

by Ross Kaplan on May 1, 2012

How Long Should Sellers Wait to Reduce Their Price?

“If a tree falls in the forest in forest and no one is around to hear it, does it make a sound?”

–Philosophy riddle

“If a Seller drops their price when the market’s slow, does anyone notice?”

–Corollary, Ross Kaplan

Not all “days on the market” are created equal.

What does THAT mean??

Just this:  60 days of market time — if the home is located in the Twin Cities and the interval in question is March and April — says volumes about how well-priced a home is.

The same home on the market between November 15 and January 15?

Not so much.

The point of the above is, a home that sits during a seasonally busy time of year is very likely mismarketed, overpriced — or both.

The best time to remedy those problems is while the market is busy, not after activity falls off.

Twin Cities Housing Market Rhythms

So, in the Twin Cities housing market, I’d characterize Buyer activity at the moment as being at a seasonally high plateau.

That’s likely to continue for a few more weeks, until the arrival of Memorial Day weekend, and — for families with school-age children — the end of the school year.

Things pick up again mid-June, then predictably slow down ahead of the 4th of July break.

The bottom line for Sellers who listed their homes earlier this Spring, but haven’t sold yet?

May is a good time to revisit price.

See also, “Nurse!  I Need a Price Reduction, Stat!!”

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Are There REALLY Multiple Showings?

by Ross Kaplan on April 22, 2012

Gauging Buyer Interest

“Please leave lights on.  There are multiple showings today.”

–Note to Buyers’ agents on Kitchen table at a newly listed home

It’s certainly not as important as knowing whether a home is in multiple offers, but one of the things Twin Cities home Buyers are running into these days  – especially Buyers looking in a market segment where inventory is tight — is the newly listed home with a TON of early interest.

So, instead of giving Buyers’ agents the lockbox location and code, and directing them to “leave a card, turn off lights, and make sure Boots the cat doesn’t escape,” there is a handwritten note — prominently displayed — telling agents to leave everything as they found it because there are multiple showings that day.

So, are there?

Context, Context, Context

As with multiple offers, it ultimately comes down to plausibility and context.  See, “Are There Other Interested Buyers?”;  ”Is it REALLY in Multiples?  How to Tell.”

If the home just came on the market, is well-priced, shows great, is in a popular neighborhood, and has no close competitors, yeah, it’s plausible that lots of Buyers are lined up to take a look.

Conversely, if few or none of those attributes are present, I’m more dubious.

P.S.:  Aren’t a slug of Realtor business cards on the Kitchen or Dining Room table also an indication of showing activity?

Usually.

But see, “Putting Your (Colleagues’ Business) Cards on the Table.”

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“Twin Peaks”

by Ross Kaplan on April 14, 2012

Twin Cities For Sale, Rental Markets

It’s widely known that the annual Twin Cities housing market generally peaks March-April (the exception being 2005, when the peak was November(!)).

At least anecdotally, however, it sure seems like that’s when the local rental market peaks, too.

That’s based on what I’m seeing with my own clients, as well as the quickening pace of rental-related emails filling up my mailbox these days.

Which makes sense.

People selling their homes and moving into a rental try to time the Spring market to catch peak Buyer interest.

Meanwhile, lots of renters-now-prospective home Buyers have May 31 or June 30 lease expirations (factors:  school graduation, mild weather, etc.).

Allowing for a 6-8 week closing period — and 4-8 weeks of home shopping prior to that — means that serious Buyers need to be out there . . . now!

P.S.:  to smooth out the seasonality in the rental market, some big local landlords have experimented with non-standard lease terms (e.g., 8 months instead of 12), and given incentives for off-peak periods.

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Housing Market Bellwethers (Good and Bad)

by Ross Kaplan on April 12, 2012

Is the Twin Cities housing market shifting gears?

Put it this way:  the public perception certainly has.  See, “Twin Cities Home Prices Up; Traditional Sales Strengthen.”

In fact, the market does feel different this spring.

The weekly Broker meetings — always a good litmus test of market trends — have devoted more time to dealing with multiple offers this Spring than they have in seven years (that would be 2005, if you need help with the math).

And active, local Buyers’ agents (that would include me) are reporting thin inventory and shifting leverage in multiple Twin Cities neighborhoods.

Turning Points

But what’s also nice is what’s missing.

Like, the unprompted offerings of sympathy (if not condolences) from complete strangers when they hear you are a Realtor.

That trend peaked (bottomed?) about 18 months ago.

Also missing:  the sketchy types who seem to invade the market — however briefly — at market extremes.  

Like shady auto dealer (and now convicted felon) Denny Hecker, who jumped into residential home sales and financing near the housing market peak.

Loudly.

There was a period back then when his ads seemed to be slapped on every bus bench and billboard in town.

See also, “Calling a Housing Market Bottom.”

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Listing Agent Refrain: ‘Put it in Writing’

March 10, 2012

Permission to Lowball . . . Denied As a listing agent (representing Sellers), I sure seem to be parrying a lot more of what I’ll call “verbal probing” these days. The gist of all the questions being lobbed by Buyers’ agents:  “would the Seller consider an offer significantly below the current asking price?” Thrust — and [...]

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Advertising Buyer Needs

February 21, 2012

It Takes Two to Tango Do a Deal SOUTHWEST MNNEAPOLIS 2+ Beds, 2 Baths, 1,300+ sq. ft. Swanky Modern or Mid-Century Modern Joseph Arcand: 612-821-4232 –Excerpt, Edina Realty ad; Southwest Journal (February 20 – March 4, 2012) What do you do in a Twin Cities housing market characterized by falling inventory, and frustrated Buyers who [...]

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Calling a Housing Market Bottom

January 19, 2012

More Twin Cities Housing Indicators Flash “Green” The “housing-has-bottomed” camp has some fresh, new ammunition. At the top of the list is an excellent post by Edina Realty colleague (and fellow blogger) Aaron Dickinson, marshalling a wealth of Twin Cities housing data that cumulatively makes a single point:  the local housing market is stronger than [...]

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Knowing When to Follow — and Break — the Rules

January 16, 2012

Pricing a Home When the Comp’s are Tough “You have to know the rules before you know when you can break them.” Normally, the standard way of doing a CMA (“Comparative Market Analysis”) is to limit your focus to three Comp’s, or “Comparable Sold Properties.” By definition, those are the nearby homes most similar in [...]

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