Crunching The Numbers
Most of us learned a little about Supply and Demand back in school. I even remember doing a mini-musical about simple economics in 6th Grade Social Studies. And yet the concept of Supply vs. Demand gets lost in emotion and motivation when looking at buying a home.
I wanted to take some time today and analyze a few housing numbers from the Twin Cities area for your benefit. There’s an old thought that goes something like, “once something is popular, it’s already out of style” which means if you wait until everyone else jumps on the bandwagon first, you probably won’t have any room to hop on yourself.
That’s a little bit similar to what the Twin Cities Housing Market has been like for First Time Home Buyers this past 12 months. Back in the winter of 2008-2009 it wasn’t trendy to buy real estate, but after the 2009 Obama Stimulus Bill passed in February 2009, which included the $8,000 Home Buyer Tax Credit, it became popular to go house hunting for your first property.
With the Tax Credit Deadline of Nov. 30th, a lot buyers waited until late summer or early fall to act, which meant there was a lot of competition in lower price ranges. While a lot of new buyers thought they were going to get a great deal and close fast, they were rudely greeted by a swarm of buyers and shrinking inventory, which added up to a ton of headaches for them (and their agents).
So here’s the scoop – the numbers will tell the story of why it’s been such a crazy market for the past few months. The summary: more buyers, less houses.
For the full report visit the MPLS Realtor Site here. All data by the Minneapolis Association of Realtors.
RED – 2008 BLUE – 2009
(Note: since most first time home buyers will be buying under the $150,000 range, we’ll focus on those price points)
Number of Homes on Market – October 2008 and 2009
Months Supply of Homes on Market – October 2008 and 2009
Number of Homes Sold – October 2008 and 2009
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All too true, Steve! The market can change and by the time it’s being reported, it’s already happening. There’s always an element of risk taking when buying a property. That’s why having a relationship with a REALTOR is so essential. We can track the numbers so buyers and sellers have the most current and accurate stats to make their decisions.