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Annual Report on the Twin Cities HousingMarket spaar FOR RESIDENTIAL REAL ESTATE ACTIVITY IN THE BETTER AGENTS • BETTER COMMUNITIES 13-COUNTY TWIN CITIES REGION 5 1 ? t':.J i a_�i A 4�,S 0(_I %r',)k 'F:, •., 5' TWO steps forward, one step back.That's how the 2014 Property Types With boomers emptying their suburban housing recovery went in most local U.S. markets. It was nests and millennials having their own unique set of another recovery year but not without its hurdles-some preferences, market activity can often vary by property type, new,some familiar. Metrics like sales price and new listings but the prevailing trend in median sales prices for both single- showed improvement,while new home construction and family homes and condos-townhouses was up-finishing 2014 inventory didn't quite meet expectations.Though the rate of with increases of 6.6 percent and 8.2 percent, respectively. improvement is uneven across areas,price tiers and market segments,overwhelmingly encouraging data sets a positive tone for 2015. Prices Prices in most areas have enjoyed another year of gains.The overall median sales price rose 7.2 percent to While that data confirms that recovery is still underway, it $205,739 for the year. Home prices should continue to rise in also suggests that the 2014 recovery was not as strong as in 2015 but perhaps at a tempered pace as the market 2013. Moderate inventory gains meant less robust-yet still approaches a natural balancing point. Price gains should be mostly positive-price growth.Since prices have risen,the more in line with historical norms in 2015. affordability picture isn't what it was in 2012 or 2013,though affordability remains above its long-term average. Factors If the economic tailwinds stick around as they should, housing such as inadequate mortgage liquidity,stagnant wage growth will get a boost in 2015.Qualified first-time buyers need good and student loan debt have served as impediments to both jobs and access to mortgage capital.Watch for movement on first-time and move-up buyers. housing finance reform. Rates should be stable until mid-2015, when the Federal Reserve is expected to raise the key federal Sales interest rates remained lower than most expected. funds rate. That helped fuel buyer activity.In general,sales continue to By almost all measures,the economic landscape has improved. skew away from the distressed segments and toward Recent gross domestic product growth is rising at a 5.0 percent traditional sales.Overall pending sales increased 6.1 percent annual rate.The national unemployment rate is under 6.0,down to 49,610 for the year. In 2015,watch for stronger seller from a 10-year high of 10.0 in October 2009, and stocks are activity to increase inventory levels,which could alleviate reaching all times highs.The deficit is down by two-thirds,gas shortages in certain areas and segments. prices are at multi-year lows and we're in the midst of the largest stretch of job gains on record.Given all that,2015 Listi119S Those shopping for homes saw their searches should hold much promise. Here's to making the most of it. return fewer homes but listings of higher quality.With 11,822 active listings as of the end of 2014,consumers had 7.2 percent fewer options in 2014 than in 2013. Persistent price gains meant once-underwater sellers could finally list their homes, but it would be good to see more sellers finding the extra confidence to sell.Seller activity increased 2.3 percent to 73,768 new listings. Expect that to continue in 2015. Table of Contents Distressed Properties In almost every community, 3 Quick Facts foreclosure and short sale activity is declining and is near multi-year lows.That's a good thing,since these distressed 5 Property Type Review product types sell at a steep discount to their traditional 6 Distressed Homes Review counterparts. In 2014,the percentage of closed sales that were either foreclosure or short sale fell 41.8 percent to 16.5 7 New Construction Review percent. 8 Area Overviews 15 Area Historical Prices Click on desired metric to lump to that page. Gurrent as of January 9 2015 All data from NorthstarMLS Powered by 10K Research and Marketing 1 2