Real Estate Rebound Hits Inver Grove Heights

There has been a modest, but noticeable buzz around Inver Grove Heights real estate circles lately. Early signs at the onset of the home buying season show the beginning of a rebound. 

“It’s not like it used to be, but I do see encouraging signs,” said Bob Reynolds, an agent with the Inver Grove Heights Real Estate Group. “Buyers’ activity levels have been up. There are pending agreements out there, and there’s a lot more activity at open houses and showings of properties.”

Paul Johnson of Edina Realty sees a perfect storm building. “There’s what I would call pent up interest,” he said. “I’ve been getting a lot of queries from people that have been sitting on the fence for a while. People are jumping into the market because house prices are really low. Basically, you’re getting a house for half-price. And the interest rates are hovering around 4 percent, or even less.”

As the national economy gathers steam and the housing market in the Metro is showing the first signs of a turnaround, statistics from the Minneapolis Area Association of Realtors show Inver Grove Heights following suit.

In January more houses were listed and sold than in the same month last year, and they were sold at a higher percentage of the list price. In January 2011 sellers got 88.9 percent of their asking price, this January, that figure had risen to 93.6 percent. Houses stayed on the market for an average of 88 days this January, as opposed to almost twice as long last year. The number of homes for sale fell by 14.7 percent, from 156 in January 2011 to 136 last month.

Not all the news is unequivocally rosy, though. The median sales price for homes in Inver Grove Heights fell by 2.2 percent, to $169,574. But prices have been rising slowly over the past few months, and properties at the lower end of the price spectrum are doing better than more expensive ones.

“Anything underneath $150,000 – those are the ones that have been going,” said Reynolds.

“The upper bracket neighborhoods are still hurting”, said local home appraiser Todd Wicker. “The middle neighborhoods are starting to stabilize. And the lower value neighborhoods seem to be slowly coming back.”

But that does not mean any old cheap house will sell, warned Johnson. “The big challenge we’re having right now in Inver Grove Heights – and citywide – is a shortage of good inventory. Young buyers want something that’s turn-key, that they can walk right into. And there’s a great shortage of that.”

Much of that has to do with the number of shortsales and foreclosed houses still on the market. In a still depressed market, even if it seems to be bouncing back, sellers should be mindful of the competition, said Wicker.

“Your property really has to be up to par. It’s got to be fixed up. You can’t have things that need repair, and it can’t be overly dated, because if that’s the case, you’re competing with foreclosures, and that just drops your value down 10-20 percent.”

Of course, the tentative housing rebound in Inver Grove Heights doesn’t happen in a vacuum. Nationally, employment numbers are down, while consumer confidence is up. The Dow Jones has risen 20 percent since October, and hit 13,000 for the first time since 2007 this week.

Minnesota’s unemployment numbers dipped below 6 percent last month – markedly better than the nation as a whole, which is still above 8 percent. January home sales in the Twin Cities were up by 26 percent compared to last year, according to the Minneapolis Area Association of Realtors.

All of that makes for a more robust market, said Johnson. “The Mr. and Mrs. are more confident that they are going to keep their jobs. That was one of the problems in the past. People were worried to jump in and commit a quarter of a million dollars or whatever. You don’t want to lose your job and become one of the statistics.”