Lynn Johnson, Owatonna, MN Real Estate

I really shouldn't complain about the weather we've had - it certainly didn't produce the tragedies that the South has had to face as a result of their severe weather. But nontheless, this long flirtation with winter weather has brought all Minnesotans to the point of shouting in unison "enough is enough"!

We hope that Spring is a sign of homebuyers, buds on trees and flowers blooming, but it's also that time of year in Minnesota when the unwelcome box elder bugs return to stake their claim. My house faces south and they love the warmth that it offers. They love to congregate and otherwise hangout at the base of my garage doors and the surrounding brick.

I checked out the University of Minnesota Extension website to learn about their habits and find ways to safely exterminate them. I'd like to get rid of them once and for all with methods other than my shoes, but after reading the information I'm not as hopeful. It seems that late summer and early fall are the best times to try to eradicate them. I also found this website which has some additional ideas and resources, along with information on non-pesticide treatments to rid your exterior of the pesky bugs.

Perhaps you've had this problem, too, and if so let me know if you've had any success in treating your home. Short of cutting down all the trees on my property (so they have nowhere to breed) I'd like to find a way to reduce or eliminate their population around my house. Please send suggestions.

Lynn Johnson, CRS, GRI, MBA

Owatonna Real Estate Pros

Coldwell Banker Home Connection

ljohnson@owatonnahome.com

www.myowatonnarealestate.com

www.cbhomeconnection.com

It seems that activity has slowed down a little from our earlier start. It's always difficult to try to make sense of when and why the level of activity varies as it does. I was looking at the sales statistics for the year to date and was a little surprised at the low average sale price. With seventeen homes sold so far this year the average selling price is $106,258. I know it's quite early in the year to make any predictions from this start, yet it is slightly lower than it was this time last year when the average sale price was $109,157. At this time last year there had been 24 homes sold. We continue to have a variety of homes available in the under $100k range with a total of 35 homes for sale - many of them foreclosures. I was curious as to the breakdown by price of the homes that have sold. I found that only one home over $179k had sold so far this year (it was a foreclosure) and the highest priced pending properties are in the $170k to $179k range (2 of them). Twelve of our 17 sales were priced under $120k.

The following report tells the story. You'll see a price range analysis for active, pending and sold listings. As we move forward in 2011 the average sale price will continue to increase, and hopefully sales will start to pick up again. As you may remember we were working with tax credit incentives through April 30^th in 2010 which spurred some sales. I expect that we will lag behind the sales pace of last year at least through that date this year. Last year purchases came to a halt during May and June as buyers had taken advantage of the tax credit offering by that April 30^th deadline. At least we don't expect to see that kind of market depression during those months in 2011. As always, please feel free to call or e-mail me with any questions. It's my pleasure to provide any additional information that might be of interest.

Lynn Johnson, CRS, GRI, MBA

Owatonna Real Estate Pros

Coldwell Banker Home Connection

159 18th Street SW, Suite 5

Owatonna, MN 55060

ljohnson@owatonnahome.com

www.myowatonnarealestate.com

As I researched this market to try to make sense of it for our sellers I looked back nine years to find information that I thought you mind find interesting. Here are the statistics I noted (all from the South East Minnesota Association of Realtors) for the city of Owatonna. This information includes sales data as reported for all sales that took place in Owatonna with any property listed or sold through a participating Multiple Listing Service member (all local real estate brokers).

Year # of homes sold Days on Market (sold properties) Average sale price

2001 455 64 $126,501

2002 467 69 $139,167

2003 487 63 $149,362

2004 492 75 $161,330

2005 505 91 $172,647

2006 436 97 $172,606

2007 400 128 $170,851

2008 297 129 $159,437

2009 322 117 $143,461

2010 YTD 182 116 $129,687

These numbers tell the story of what we have been experiencing for the last few years. We thought it was bad in 2007, and certainly didn't realize at that time how bad it would get. If we maintain the same pace that we've achieved so far this year we will probably see sales under or just a little above the 300 home mark (a 40% - 45% decrease from 2005) and average sale prices around $130,000. As you can see from the numbers, we haven't hit an average sales price below $139k since 2002. At least in 2008 when we were below 300 homes the average sale price was $159k.

We don't expect the real estate market to rebound quickly. It will hopefully start to improve soon, and it appears that it could be sluggish growth at best for the next two years. As you are well aware, the issues holding the market back are problems that no one of us can repair - it will take significant work to rebuild the damaged consumer confidence, and to provide sustained job growth to bring homebuyers back into the market.

The best that many potential move-up (2^nd time) buyers can hope for is to continue to pay down their mortgage so they can afford to sell their homes when the time comes for them to move. That stumbling block (they bought in 2003 - 2007) and owe more on their home than what they can sell for - forces them to stay put until their circumstances change. That factor has taken so many of our usual buyers out of the market. The move up buyer fueled most of our robust sales from 1996 - 2006 - and now most of them aren't in a position to move.

One other factor that we've found affecting potential home buyers is the number of people who have been sidelined from the market for at least 3-5 years because of a home foreclosure or other derogatory credit issues. These are definitely issues that we've not had to face before - and especially on such a large scale.

What can we do to ease this depressed market? We are trying our best to be patient - as painful as this is for many sellers, we know that it will ease. We look for the positive and try to accentuate that whenever we are talking with potential buyers - the interest rates are amazing and home affordability will never be this good again. Home ownership IS a good investment for the long run - many people were caught in the shorter term situation. Homes sellers will have to face the unfavorable market by being as competitive as they can be with their pricing and home condition. It's imperative to position your home in order to compete with the other homes in the market and "WOW" the buyer with value. Homes need to appeal to "today's" buyers who have so many very nice homes to choose from. Their wants, needs and expectations are different from the buyers we may have seen in the past. On the plus side for many sellers is that if they are purchasing they are able to benefit from this down market as a buyer - so in many cases it may be in their best interest to sell - even if they have to bite the bullet on their price. Chances are they can make that it when they buy.

As always, please call or e-mail me with any questions and if you know of anyone who may be looking to purchase a home please send them my way - we've got great houses to choose from!

Copyright 2010

Lynn Johnson, CRS, GRI, MBA

Owatonna Real Estate Pros

Coldwell Banker Home Connection

507-390-6109 cell

ljohnson@owatonnahome.com