Minnesota Association of Realtor's Market Report

The Minnesota Association of Realtors (MAR) completed a report for the 3rd Quarter of 2007. It is available online at their website. Its a VERY interesting report (and quite large - 16MB in size).

One section that I found interesting stated that:
"Housing prices over the time period beginning in 1998 through the end of 2003 grew over 5 times faster than inflation. Inflation increased nearly 14% over this time, whereas housing prices increased 62%. In the 24 month period covering the beginning of 2004 through the Fourth Quarter of 2005, inflation increased about 7.3% (or about 3.65% per year, on average), and housing prices rose approximately 14.99% (or about 7.45% per year, on average). Between the Third Quarter of 2006 and the Third Quarter of 2007, the average house price in Minnesota fell by about 2.4%."

Here's the interesting thing - even with a fall of 2.4% over a one year period, we're STILL at incredible increases spread over the course of time from 1998 to the present (just shy of 10 years). We're still FAR ahead of even what the stock market was able to do during that same time. A little slow down in price is OK - no one is earning 62% more than we were in 1998 (see the inflation rate). We were in essence pricing people out of the market as the value of homes climbed and climbed.

Yes, it hurts to not see the value of a home as high as it was. It stings. But, if you've been in your home for more than a couple of years, and you did not refinance to 110% of your home - you're still able to sell for a nice profit!

AND, if you're selling for a little less than you were hoping to sell for -- Remember, you're able to buy for a little less than you would have expected to.