Tami and Steve's I-94 Minnesota Real Estate Blog: September 2007

A recent National Association of Realtors buyer survey may surprise you. Today's buyers have energy efficiency on their minds as well as oversized garages. They still want central air conditioning at the top of their list, but right up there is "cable ready," satellite TV and high speed Internet. Lifestyle dictates are also evident in the survey, including interest in exercise rooms and in-law suites. To see how your home compares to these national trends, or how the trends compare to what you are looking for in a home, visit: REALTOR Magazine Online October 1, 2007. To participate in the survey, go to: Buyer's Favorite Feature Quiz.

Enjoy the privacy and peace of nature on two-and-a-half heavily wooded acres along the Mississippi River. With five bedrooms and over 3500 square feet, there is plenty of space for all! Majestic views abound. Gas and wood fireplaces for relishing seasonal changes. A triple-car attached garage as well as a double-car detached garage/shop. View this listing at: 8567 116th Street, Clear Lake, MN 55319.

Enjoy the privacy and peace of nature on two-and-a-half heavily wooded acres along the Mississippi River. With five bedrooms and over 3500 square feet, there is plenty of space for all. Majestic views abound. Gas and wood fireplaces for relishing seasonal changes. A triple-car attached garage as well as a double-car detached garage/shop. View this listing at: 8567 116th Street, Clear Lake, MN 55319.

This spacious rambler is located within commuting distance of St. Cloud or the Twin Cities Metro area. Four bedrooms and two baths with 2400+ square feet, there is plenty of room for work and play. It features a kitchen island, front foyer, office, recessed lighting and uprgraded doors and trim on lower level. Large lot for outdoor fun. View this listing at: 121 Glen Road North, Watkins, MN 55389.

Impressive split-foyer on St. Cloud's south side at an incredible value! Four bedrooms, including a master suite, and two baths, walk-in closet, spacious living spaces, complete appliance package, family room and den. Very popular neighborhood with easy access to I-94. View this listing at: 1807 S. 36th Street, St. Cloud, Minnesota, 56301.

Fabulous St. Joseph, MN rambler, completely finished and ready to move into with four bedrooms and two baths, kitchen with center prep island, a spacious family room, front porch, back deck, and triple-car heated garage. Access to Pleasant Lake through a voluntary association. $219,900. View this listing at: 32755 Pamela Lane, St. Joseph, Minnesota 56374.

Remodeled and well-maintained, this three bedroom, two bath rambler is now just $149,900. It features a completely remodeled kitchen with new countertops, sink and faucets; new stove, dishwasher, microwave and refrigerator; refinished hardwood floors; a huge rec room and 3/4 bath in the lower level. View this listing at: 525 NE 2nd Avenue, St. Cloud, MN 56304.

Newer home on large lot with about 34' of water frontage on the Sauk River. A private setting in town, this split-foyer features sliders from the dining room and master bedroom, vaulted living areas and an open floor plan. Great new price at $184,900! Perfect setting for barbeques and fishing. View this listing at: 3303 Park Drive, St. Cloud, MN 56303.

Gorgeous tri-level in Sauk Rapids with stylish upgrades! Three bedrooms and two baths, with a granite prep island, stainless appliances, hardwood floors, front porch and open floor plan. Oversized triple garage. Contemporary neighborhood. Great price! View this listing at: 1012 Orchid Drive, Sauk Rapids, MN 56379.

Hands, Down! Best Deal in Town on this 2400+ square foot split foyer. Three bedrooms, two baths and upgrades galore. An energy star home with six-panel doors, prairie-style cabinets, master suite, surround sound, wet bar, center prep island. Steel siding, concrete driveway, inground sprinklers and fully landscaped. Ready-to move into and enjoy! View this listing at: 705 8th Avenue, Rice, MN 56367.

Small town lifestlyle close to city conveniences in this Annandale, MN split-foyer now priced at $204,900. Hardwood floors in the kitchen and dining room; center prep island; a vaulted main level with slider to deck; a partially finished lower level equity-builder. Insulated garage doors. Easy access to I-94. View this listing at: 312 Ash Street, Annandale, MN 55302.

New Price from Motivated Sellers on this gorgeous turn-of-the-century Craftsman-style two-story. Three bedrooms and two baths with maple floors, original woodwork, a built-in hutch and buffet in the spacious formal dining room. Unique character features including Craftsman pew seat, columns, built-in book cabinets and leaded-glass window in living room. In addition, a roomy country kitchen with pantry and enclosed front and back porches. Close to Wilson Park and the Mississippi River. Core Neighborhood Loan Money Available to Qualified First-time Homeowners. $137,500. View this listing: 315 NE 4th Avenue, St. Cloud, MN 56304.

Motivated sellers have price reduced this southside rambler to $199,900. Incredible value in this popular St. Cloud neighborhood. Over 2,500 square feet, three bedrooms and three baths, with a main floor laundry, owner's suite, formal dining, upgraded flooring, newer roof, private deck, and lower level family room with gas fireplace. Plenty of storage. View this listing at: 2020 S. 17th Street, St. Cloud, MN 56301.

According to current Central Minnesota MLS market data:

There were fewer listings in August 2007 than in July. This adjustment in inventory should lead to fewer days on market for sellers.
Listings SOLD went up from July 2007 to August by 15 units. If this trend continues, we will also see fewer days on market.
The absorption rate in the St. Cloud Metro Area (St. Cloud, Sauk Rapids, Sartell, Waite Park and St. Joseph) declined from 10 months in July 2007 to 9 months in August. This is positive movement toward a more balanced market.
If you are curious about the absorption rate, days on market or other specific data in your neighborhood, give us a call or email!

A key piece of data that many economic experts, real estate brokers and realtors agree upon is the importance of the "absorption rate" in the current housing market. The absorption rate to economists and brokers is the months of inventory available in a targeted market. To home sellers, the absorption rate represents the number of properties competing with their home on a month to month basis.

Think of a Hershey chocolate bar. Every convenience store manager stocks the shelves knowing how long it will take to sell a box of Hershey bars. He doesn't usually restock until the entire box is gone. The same concept applies to a seller's home: if there is a 12 month absorption rate, that means there are enough homes on the market at the current buying rate to last 12 months. In this case, the convenience store manager understands that he doesn't need a new box of Hershey bars for an entire year. The home seller understands that she may face long days on market--up to a year. However in the housing market, the "manager" is continually restocking the shelves: these are called new listings and affect the absorption rate month to month.

To home buyers, the absorption rate indicates the number of properties that are available to view (choices in a given price range) from month to month. At a 12 month absorption rate like the one described above, the housing market is generally considered a "buyers market."

SO, HOW IS THE CENTRAL MINNESOTA MARKET?
2005 to 2006/07 COMPARISON
A FOCUS ON ABSORPTION RATES

The current absorption rate for the entire Central Minnesota MLS area for residential properties is 11 months. Narrowing our focus to the St. Cloud Metro area (St. Cloud, Sartell, Sauk Rapids, Waite Park and St. Joseph,) however, reduces the absorption rate to 9 months. This rate has increased from 4 months in August of 2005, and from 7.7 months in August of 2006.

What this means to sellers is simply more competition, longer days on market, and that buyers will have higher expectations for the home that they purchase. To buyers it means more homes available to view and therefore more decisions to make, as well as a greater time investment in the process.

If you are interested in the absorption rate, days on market or other specific data in your neighborhood, give us a call or email.

Here's the good news we've been waiting for in the housing market!
Lawrence Yun of the National Association of Realtors published this article in the September 2007 issue of REALTOR magazine.

"The Signs Align"
PREDICTIONS ARE ALWAYS RISKY, BUT I'M going out on a limb to say exiting-home sales will improve markedly by the fourth quarter. Here's why:
Pent-up demand. The country has added nearly 4 million jobs since home sales started cooling in mid-2005, and the typical worker's wages have risen 7 percent, leading to a $1.35 trillion rise in aggregate national income. At the same time, wealth has grown significantly, with the Dow Jones Industrial Average hovering at record highs. Indeed, accumulated household wealth as of the first quarter was at a record $56.2 trillion. So, if you're wondering if people have the means to purchase, they do.
Delayed household formation. The number of households typically grows by up to 1.5 million a year, but in the first quarter, the year-over-year figure was only half a million. That weak performance suggests people are holding back because of uncertainty over the future, a trend that fuels pent-up demand.
Rising rents. With renters hesitating to buy, landlords are raising rents. Average rents rose 8 percent in the past two years. As renters start feeling squeezed, ownership will look increasingly good.
Condos make modest gains. The condo market has outperformed the single-family market i sales and price changes since early this year. Single-family homes could follow suit.
Better mortgage quality. Mortgage applications for home purchases have been rising nearly 10 percent on a year-over-year basis since May. This data, from the Mortgage Bankers Association, focuses mainly on applicants for prime and FHA loans, so the rise indicates a flight to quality.
Dollar weakness. The falling dollar has dangled as a big "For Sale" sign in front of property attractive to foreign buyers. Europeans can now buy a vacation home at essentially a 15 percent discount. That's good for sales. And despite the weak dollar, which usually leads to higher interest rates, mortgage rates remain attractive at around 6.7 percent.
2008 rate cut. Inflation looks to slide as the year proceeds. If it does, the Federal Reserve could lower interest rates, possibly as soon as early 2008.
So, keep your eyes on the horizon. There are forces at play that will turn the market around, and buyers who make the commitment now could be smiling next year.
To see this article in its entirety, view this link at REALTOR.org.

Clean and ready to move into! Three bedroom rambler in a country-like setting just minutes from St. Cloud. New carpet and tiled floors. Jetted tub in bathroom and three-season room. Spacious deck and fenced yard with mature trees. Oversized garage. Very affordable at $144,900. View this listing at: 8655 NW Lakewood Shores Road, Rice, MN 56367.

Well maintained a spacious condo in the Sartell school district. Huge master bedroom with walk-in closet and prep vanity. Guest bedroom. Convenient living with all the amenities including outdoor pool. Association fees include all utilties except electric. Seller will entertain all reasonable offers. View this listing at: 701 N. 9th Avenue, Sartell, MN 56377.

This newer split-level on a large lot is graced by frontage of the Sauk River. Spacious vaulted living room and master bedroom. Two bedrooms and one bath, the lower level is unfinished for equity-building. Central air. Walkout to a future deck. View this listing at: 3303 Park Drive, St. Cloud, MN 56303.

This home is well-maintained and fully finished up and down! Three bedrooms and two baths, it sports a spacious "L"-shaped living room, a full appliance package, a vaulted great-room, kitchen with prep island, and dining room with slider. All new mechanics with high performance ratings. Easy access to I-94. View this listing at: 1011 Stonebrooke Drive, Albany, MN 56307.

Enjoy this convenient and fun lifestyle with one-level living on an outstanding lot overlooking the Mississippi River! An open and spacious floor plan welcomes you. Vaulted ceilings, a large kitchen with breakfast bar, a bright four-season room and a huge wrap-around deck. The garage is spacious with plenty of storage. Clearwater Estates boasts a golf course, swimming pool and clubhouse. Quick access to I-94 and the Twin Cities. View this listing at: 112 Goldfinch Lane, Clearwater, MN 55320.

Truly impressive! Four bedroom, plus office, spacious rambler in West St. Cloud, Minnesota on a professionally landscaped cul-de-sac lot. Amenities throughout: Andersen windows, Jenn-Air gas grill and range, custom cabinetry, raised-panel oak doors, breakfast nook, gas firplace, tranquil attached screened-porch, vaulted ceilings, custom window treatments, wooded lot, apple and plum trees. Ideal peaceful living within the city limits. View this listing at: 814 Pebble Creek Drive, St. Cloud, MN 56303.