Inver Grove Housing Market Looking Good Heading Into Summer

The housing market in Inver Grove Heights is showing promise in several key areas, according to statistics released in early June from the Minneapolis Area Association of Realtors (MAAR).

Compared to 2011, the number of new listings in the city is up 3.4 percent in May and up 1.7 percent so far in 2012. The number of closed sales in Inver Grove also increased 40.7 percent—from 113 in 2011 to 159 this year.

The average number of days homes are staying on the market has dropped dramatically. Year-to-date statistics show an average of 14 fewer days on the market compared to 2011.

In fact, homes in May 2012 spent an average of 124 days on the market compared to 153 days in 2011—an 18.5 percent decrease.

One particularly encouraging statistic shows that the months supply of inventory—or, the time it would take to sell every available home on the market—has dropped from eight months in May 2011 to 3.5 months this year.

Despite the positive signs, sellers are taking a slight hit.

According to the MAAR report, the price at which these homes are selling is down 3.0 percent compared to last May and almost 5 percent (4.8) compared to 2011.

Regionwide Sales

The MAAR statistics also show evidence of a real estate recovery across the Twin Cities. 

The median regionwide sales price was $169,000, up 10.5 percent from the same month last year. That represented the third-largest year-over-year jump since January 2004 and the third consecutive month of year-over-year gains.

Median prices have risen 22.5 percent since February (from $138,000 to $169,000), and are now at the highest level since October 2010.

Part of that was due to decreased supply. The number of homes for sale has dropped for 16 consecutive months, down 31.1 percent from last May to 17,262 active listings—the lowest inventory reading for any month since January 2004.

That trend continued in May; during the month, buyers signed 5,130 purchase agreements, 27.3 percent higher than the same month last year, and sellers introduced 6,599 properties to the market, 6 percent less than May 2011.

This combination of activity drove down the number of homes for sale on the market to 17,262, down 31.1 percent.

As a result, "Residential home prices have been increasing steadily," said Cari Linn, MAAR’s president. "It's been a positive change for our local housing market and it'sbeen a long time coming."

Linn noted that another factor in the median price rise is the fact that so-called "distressed properties" now comprise a smaller share of overall sales. Traditional homes now sell for a median price of $205,000, foreclosures sell for $116,350 and short sales go for $135,000, so the smaller proportion of the latter translates into median price gains.

Traditional closed sales were up 50.1 percent, while foreclosures fell 12.8 percent and short sales increased 12.9 percent. Together, distressed homes made up 31.1 percent of all new listings and 39.4 percent of all closed sales, the smallest shares since June 2008 and September 2008, respectively.

Homes sold in 125 days, on average, down 19.6 percent from last May. Sellers received an average of 94.5 percent of their list price, up 3.8 percent from last May.