Enclosed is our newest video on real estate in the Twin Cities. You will also find the script of our video.

http://www.youtube.com/watch?v=Owktcf8r3KY

 

STEVE:  Hi, this is Steve Westmark, Counselor Realty.  Thanks again for tuning in.  Today, I’m going to talk to you a little bit about some other things and what they call our Market Indicators Report.  It comes out once a month, and it talks about what our market is indicating and where we’re going and what is happening.  So many times people ask me, “Well, what is happening in the pricing market?”  Well, the graphs that you’re going to be able to look at here show both what has happened in the median sale price and in the average sale price.

 

Quickly, the median sale price is the price of the middle sale, the one that’s right in the middle.  So if half the sales are below 150 and half are above 150, that’s the median sale price, where the average sale price is taking the total number of sales and the total volume and dividing it to come up with an average sale price.  So they’re both very interesting statistics to look at, and they give you some kind of idea of what is going on in our marketplace.  What you’re going to notice on this graph is that in the early 2000s, the average sale price in the Twin Cities was around $175,000, and then it began to climb and it peaked in about 2006 up in the $286,000 area.

 

And then we saw the fallback in our marketplace with the crisis in our financial markets so that our average sale prices began to decline and go down.  So that you’ll see today our average market price, as you look at the graph that’s on here, you’ll see that the average sale price two years ago was at $242,000.  Then in 2009, it was at $198,000.  And today, it’s at $190,000.  It’s beginning to bottom.  So people ask me, “Is the bottom over?”  Well, when you start looking at some of the trends on here, it begins to start showing that we’re kind of bumping along the bottom, and probably the bottom is over for the reduction in value.

 

The second chart that you can look at is the median sale chart, and you’ll see from the median sale chart on the graph, two years ago the median sale price was 189,900.  In 2009, it was 170,000.  And currently, it’s at 166,000.  So we’ve continued to see our median sale price drop, but I can tell you is that you dig through some of the other statistics you’re going to also see that our average dollar per square foot in the Twin Cities is now beginning to change slightly.  And so there is about a 1% to 2% move up in our average sale price.

 

The last two graphs I’m going to show you is the first one is closed sales.  You’re going to see how our closed sales have changed, and what I want you to look at is how we have been affected and why these values have remained somewhat stagnant.  Two years ago in September, we had 4,202 sales.  In 2009, we had 4,216 sales.  And for this September, we only had 2,803 sales.  So you can see that we are still somewhat stressed in our marketplace, though the last thing that I want to show you that is a positive thing to look at is what has happened to mortgage rates.

 

As you look at the mortgage rate chart, you’re going to see that in 2008 our interest rates were running right around 7%.  Then in 2009, they were averaging 5.4%.  And currently in 2010, in today’s market, we’re at 4.6%.  It’s a great time if you have a mortgage on your own property that’s at 6% or more to look at going and refinancing and getting a 4 to 4.5% interest rate 30-year fixed.  But it also gives you great affordability in going out to the marketplace and buy a lot more house for the dollar than what you could have at 6% or 7%.  Thanks for listening in today, and we look forward to seeing you next week.  Make it a great day.