Now, all the market needs is more sellers.
“We’re very encouraged by the recovery we saw in 2012,” said Andy Fazendin, president of the Minneapolis Area Association of Realtors (MAAR), at a news conference late last week to announce the organization’s annual market-results survey. With the area’s economy recovering and interest rates at historic lows, “we clearly saw behavior (among buyers) change from the start of 2012 to the end of 2012.”
A robust year for Roseville
The result: The median price of a home in Roseville rose a robust 18 percent in 2012 from a year earlier, going from $158,500 in 2011 to $187,000 last year.
Another encouraging indicator: completed home sales. Roseville had 414 in 2012, up from 310 for a 33.5 percent gain.
The number of days homes spent on the market dropped dramatically: In Roseville, the average home sale now requires 117 days, an 18 percent drop from 142 days required to sell a home at the end of 2011.
Rick Duffy, of The Duffy Group-LaBelle Real Estate, said he had a good year in 2012 for sales and expects similar results in 2013. He said the sales volume in his Roseville office increased by 100 percent last year
"I think we are back in the race," Duffy said. "I'm not sensing fear in the marketplace like before."
One indicator of the upturn is that many sellers have been getting multiple offers on their homes, Duffy said, with the percentage of sellers getting them being the highest he has seen in nearly 30 years.
Even with the spectacular rebound in prices, however, prices have a long way to go before returning to the values of the past decade. The Twin Cities’ region overall median price at the end of 2012 was $167,900. That’s way up from the $150,000 median of a year earlier, but at its peak in 2006, the median hit $230,000.
As a result, many homeowners are apparently still reluctant to list their properties for sale, Fazendin said. Inventory is at a 10-year low, and some people who want to buy homes “are writing four or five offers (and) still not getting a house.”
Fazendin believes the problem will self-correct, however.
“Sellers soften trail buyers” in getting excited about the market, he said. In 2013, he expects the median price across the region to grow an additional 8 percent to 13 percent, which should result in more “For Sale” signs sprouting up.
The recovering market should also prompt a big increase in new home construction across the region, said Kate Beckman, president of the St. Paul Area Association of Realtors.
“We’ve seen a great increase in activity,” Beckman said. “We believe new construction could surge 25 to 35 percent in 2013.
There’s a lot of “pent up excitement among our agents,” she added. “We had full parking lots in our offices in December. That’s unusual.”