The State of Real Estate: Edina and Southwest Minneapolis: January 2012

With January under our belt, I'm glad to announce, the Real Estate market in Edina and Southwest Minneapolis is really improving and shows signs of real recovery.

"Recovery" is a work I'm careful about using. For the past 5 or 6 years we've encountered waves of new crises, foreclosure crisis, bank crisis, credit crisis, economic crisis... crushing any recovery at the time. But strong fundamentals continue to fuel a strong Real Estate market in Edina and Southwest Minneapolis.

January has been beautiful in the Twin Cities, maybe it's the weather, or the good employment numbers, or the fact that people simply can't wait any longer to buy a home. In any case buyer activity is growing. Coupled with declines in listing activity, the result is improved inventory levels.

What does that mean for you? Not much if your buying or selling today. The market is still fundamentally the same, buyers want a great home in a great neighborhood for less and sellers are trying to figure out how to compete with short sales, foreclosures. The good news is that over the long run I believe median home prices are stabilizing and that demand for homes is rising. Maybe in a year or two we will feel the effects as the market begins to balance out. For now we are still squarely in a buyers market.

Some very interesting trends to watch...

1) New Home Construction: In the Edina and Southwest Minneapolis real estate market that means tear-downs, new homes built after tearing down the home that was there before. This in-fill or tear-down activity has not slowed down in spite of the slow market in general. One reason, cheaper land. As the purchase price of the original home and lot has been hammered, the end result is a better deal on the new construction home.

2) The best block always wins. As buyer activity improves across the Edina and Southwest Minneapolis real estate market you'll find areas where homes seem to always sell fast. The old adage applies here, "Location, Location, Location" everything else being equal buyers always buy into the best neighborhood they can afford.

3) Interest Rates: I'm so sick of saying this, but, interest rates are so low! If you need a reason to buy this is it. Do not wait, buy now. Even if prices do drop, a small tic up in the interest rates will balance out the savings.

Loving real estate Edina and Southwest Minneapolis, and loving this early spring time weather!

Ben Kolkman