"Twin Cities Real Estate Market Update 12-22-2010 

STEVE:  Well, welcome again.  I’m Steve Westmark.  Thanks for watching my video blog.  The numbers have just come in from November, and so I’m going to give you just four charts that you can look at to see what’s going on graphically in our marketplace.  The first chart is the month’s supply of inventory.  You can see from the graphs that we’ve gone from an 8-1/2-month’s supply in 2008 to a 5-1/2-month’s supply in ’09.  And now we’re jumping back to a 7.8-month’s supply for 2010.

The second chart that I want you to look at is the mortgage rates where in 2008 they were at 5.9%.  Then they dropped in 2009 to 5.1%.  And currently, we’re at a 4.7% interest rate out there for 30-year fixed mortgages.  The third one is showing what’s going on in the median sale price in our marketplace where in November ’08 we were at 175.  In 2009 at 170.  And in 2010, we’ve had a 1-year drop again of about 2-1/2% to 165,700.

The last chart that I’ll have you look at is the chart that shows housing affordability.  Because of lower interest rates and because of lower sales prices, you’re going to see that our affordability has moved from 180 in 2008 to over 218, a 21% increase since 2010.  So what all that means in the marketplace is that housing is at a great time to be purchasing.  You will see the stats probably by the end of the year coming out through the end of December that our sales will be off by about 15% and the total inventory is going to be up by 12%.

For buyers that are out in the marketplace, it’s going to be a great time to be purchasing.  You can buy more house for your dollar than you ever could have in the last decade.  I hope you have a great holiday season, and Happy New Year.