Eagan, MN

Eagan Residential Sales Increased 21% In 2011

Eagan, Minnesota has had a substantially improved year for sales of residential real estate. According to the Regional Multiple Listing Service of Minnesota, there were 775 residential sales in 2011, which is approximately 21% more than the 640 tallied in 2010.

While there are many ways to measure market trends, the total units sold represents buying interest and also suggests that there may have been more qualified buyers in 2011. 2011 sales also exceeded 2009 by about 3.5%. 2009 and the beginning of 2010 were the years of the homebuyer tax credits, and many analysts believed that the credits would influence buyers to accelerate their plans to the detriment of the years following. That does not seem to have significantly affected 2011.

With an economy inching its way forward, and with improved real estate sales, there is cause for optimism that the worst of the real estate crash is behind us. While home prices may go up or down, the drastic fluctuations of the past years will probably not be repeated soon.

If you're thinking about buying or selling real estate in 2012, you need all the location-specific information you can find. We invite you to make us your source of information about Eagan real estate and all your questions about buying and/or selling a home. Calls and emails will be answered promptly.

Last year, my state of the industry post followed the state of... addresses by the President and heads of various states. This year it's my turn to go first, and like last year, the following are opinions that are based only on my personal perception.

The industry is almost the same as the beginning of 2011. Prices are not changing with any alarming velocity, and the number of sales, although somewhat improved in many markets, are not approaching robust levels. The new distressed properties are, like many in the beginning of 2011, no longer the result of loans to the unloanable accidental homeowners, but now the result of a poor economy and a job loss or other hardship. The fact that many persons who can't keep their homes cannot afford to sell them is perpetuating the poor state of the housing industry and a high inventory of distressed property.

As it was in the beginning of 2011, most buyers are first time buyers or investors, and they are getting what appears to be excellent value and excellent interest rates on financing. Although it appears that there is little possibility of a spike in home prices, interest rates could experience rapid substantial changes.

Last year, my opinion was that the industry needed to involve move up buyers in the market before anything turns around in a noticeable way. That opinion has not changed. With so many underwater owners immobilized for probably another decade, it's hard to see how the present course will change before the 46th or 47th President takes office. We have a half generation of people who will only move out of their homes if they walk away or negotiate a short sale with their lender.

Government initiatives are all directed at immobilizing people or turning them into renters. People who want to stay where they are are being encouraged and assisted in negotiating their exit. People who want to buy and move to a home that is a better fit for their families are stuck where they are, even if they can afford a much higher payment. Government and lenders have joined forces in virtually ignoring this large number of forgotten Americans. They can either stay or walk away and become renters. 2012 -- more of the same.

Eagan homes for sale in Eagan, MN. Over the last year, the Eagan real
estate market has improved dramatically. Although economic setbacks
have occurred with the closing of Lockheed Martin and a few other
companies, real estate continues to sell in Eagan for a number of
reasons.

Like other prestigious areas of the Twin Cities, Eagan homes for sale
offer numerous advantages over other areas. Besides an award winning
school system, Eagan sports excellent access to Minneapolis and St.
Paul. Get to downtown Minneapolis via 35W, Cedar (77), or Hiawatha -
or get to downtown St. Paul via a half dozen access points.

Eagan homes for sale average $175,000 for 2011 thusfar and stay on the
market an average 128 days. Eagan has its share of foreclosures and
those are generally found in higher concentration towards the southern
end of Eagan. Eagan short sales (pre-foreclosure sales) are also
prevalent in the same areas.

Year to date, 1099 new Eagan listings have come on the market.
A drop of nearly 15% from this time last year. Closed sales are up by
23% so far with 668 closed sales. And on average, homes for sale in
Eagan receive roughly 90.8% of list price, versus 98.9% for our
clients. The most popular Eagan homes for sale tend to be the
midrange Eagan homes $225,000-$325,000 price range. And the current real estate market has
produced a plethora of Eagan homes for sale under $200,000.

As of the census of 2000, there were 63,557 people, 23,773 households,
and 16,427 families residing in the city. The population density was
1,967.6 people per square mile (759.3/km²). There were 24,390 housing
units at an average density of 755.1 per square mile (291.5/km²). The
racial makeup of the city was 88.03% White, 3.41% African American,
0.26% Native American, 5.31% Asian, 0.10% Pacific Islander, 0.96% from
other races, and 1.93% from two or more races. Hispanic or Latino of
any race were 2.24% of the population.

Plan ahead for postage increase

Those of us who operate a business, whether real estate or otherwise, understand that sometimes things don't go well. The Amazons and Netflixes and others like them have distressed many brick and mortar businesses that attempted to compete with them. Some survived and some did not. Anyone who has been in business for more than a few days understands that competition is nothing to be ignored. Well, everyone but businesses connected with the government.

The US postal service has for decades competed with United Parcel Service in the package delivery business. For most of those decades, UPS has been profitable and the USPS has not. Now there are more players in the same area including FedEx and others. They all tend to be profitable while USPS operates at a loss.

The internet and the emergence of email and electronic bill receiving and payment have further depleted the USPS revenue. It also seems that technology improvements have not increased reliability or decreased the amount of elapsed time between mailing a letter and receiving what has been mailed. In short, the USPS has taken on competition by doing nothing or worse.

Faced with huge losses, USPS has once again demonstrated their lack of business acumen by doing what they always do. They are raising their prices. If your competition is providing better and more reliable service, and they are charging less, dive head first into the shallow end of the pool. Raise your already too high prices.

On January 22, the postal service will raise the price of mailing a first class letter by one cent. If you do a lot of mailing, this may be a good time to pay the postal service ahead by buying some of their forever stamps before the rate increase. If you are looking for some additional end of 2011 expenses, buy next year's stamps before the end of the year.

Both must wait until the other has passed

There has been a report floating around the internet for years that says there is a law, usually reputed to be in Washington, that two trains coming to a crossing must both wait until the other has passed. I've seen variations of this absurdity. Once I found a rural intersection with a four-way yield, about the same as the train law.

Another absurdity is the rhetoric about the housing industry and the economy, unemployment levels to be more specific. The story goes like this, "Housing will return to normal when the economy recovers and there are fewer unemployed people." Of course there is the other story, "Unemployment levels and the economy will only return to normal when the housing industry recovers." Apparently, both must wait until the other has passed.

I guess we all feel that we have some insight into what must be done before there is improvement, and there is an element of truth in most folks' ideas about housing and/or the economy and high unemployment levels. Here are a few of my thoughts:

• The inventory surplus in housing is due to both the aging of our population and the tendency for extended families to consolidate their living arrangements. It is a symptom of a poor economy with a high level of unemployment.
• It will be four to ten years before there is a noticeable trend toward higher home prices, and they will likely be in line with inflation, not beyond that.
• Most of the excess unemployment is the result of the continued housing depression, with construction work and supply line jobs gone for the long term.
• Walkaways can be reduced if there are more people living in homes they like and want to continue to call home.
• There has been virtually nothing creative occur in the real estate sales, home building, lending or government to attempt to shorten the duration of the depression.
• If there is ever an action taken that helps the housing depression, it will have to involve people who are currently home owners with the ability to make a higher monthly payment. Either portable underwater debt or incentives to accelerate paydown of debt, or both will contribute to housing recovery.