Duplex Chick

Comment

As of late, the Minneapolis duplex market seems to have tendinitis in its throwing arm. It aims in the general direction of a recovery, but never seems to find an open receiver.

For the week ending October 2, 2010, just 18 purchase agreements were signed. Of those, a mere 16.67 percent did not involve a bank in the negotiations.

These 18 transactions were 33.3 percent fewer than those that pended during the same week last fall. One-third of those sales involved traditional sellers.

The good news is there are fewer new listings as well. While there were 50 new duplexes, triplexes and fourplexes on the MLS during the week last year, this year saw just 28 new listings.

Thirty-two percent of the 2009 listings were offered by traditional sellers. This year, 53.6 percent were not bank owned or short sales.

The average off-market price of $110,794 trailed last year’s average sold price of $112,530 as well.

Let’s hope the housing market finds some Advil soon.

Comment

I try to be an optimist; to see the bright side of a slower duplex market.

To that end, let’s call the sixteen duplexes that had purchase agreements signed in the week ending September 25, 2010, the glass half full.

Trouble is, nearly twice that many (31) pended the same week one year ago.

Traditional sellers contributed 31.25 percent of those transactions, compared with 2009 when they offered 22.5 percent of the pended sales.

The average off market price for the week was $86,412.50. This represents a 15.5 percent drop from last year’s average sold price of $102,232.

The good news is the number of new listings also dropped by nearly half, 34.4 percent coming to the market with traditional sellers. This just edges the 32.8 percent contributed by them one year ago.

In the single family sector, listing activity dropped 19.9 percent from the same week last year. This wood be good news had there not been 41.7 percent fewer purchase agreements signed than last year.

The sharp decline in buyer activity means housing inventory is swelling, with the current 26,915 active single family home listings on the MLS being 9.8 percent higher than last year’s offerings.

Of course, whenever supply exceeds demand, prices fall. This represents a golden opportunity for buyers; especially multi-family property investors who are seeing double digit returns on rental property.

There has never been a better time to buy.

Comment

Sometimes Minneapolis duplex numbers are difficult to write about.

In this market, that’s from both a creative perspective and an emotional one.

I’m just flat running out of metaphors, adjectives and adverbs.

The supply of residential homes on the Twin Cities MLS has grown by 9.5 percent since last year for a total of 27,408 homes on the market.

Meanwhile, the 596 signed purchase agreements for the week ending September 18 represent a drop of 42.9 percent from last year’s 1,043 signed contracts for the same week.

The duplex and small multi-family didn’t fare much better. While the number of new listings for the week was down 21.3 percent from last year, the number of pended duplex sales was also down– by 50 percent.

Just 19 percent of the week’s pended properties were negotiated by traditional sellers, while 58.3 percent of the new listings were offered without some level of bank involvement. This is a gain from last year’s 42.6 percent of traditional seller new listings.

Unfortunately, however, the abundance of market supply put downward pressure on prices. Last year’s average sold price for the week was $125,509. Meanwhile, the average off market price of a Minneapolis duplex this year was a meager $105,462; a number that’s sure to drop once those transactions actually close.

While the lower sales prices are certainly discouraging for sellers, there’s always a silver lining. In other words, if you’ve ever considered buying a duplex or adding real estate to your investment portfolio, it’s unlikely there’s ever been a better time to buy.

1 Comment »

Shakespeare wrote, “Don’t shoot the messenger.”

So why do I think it’s still a good idea to don a bulletproof vest?

Perhaps because I don’t seem to have any good news for the Minneapolis and St Paul duplex market this week.

While this week’s statistics include the Labor Day holiday, pended sales were nonetheless down 20 percent from last year. These properties left the active inventory at an average off-market price of $105,292; a figure which once these transactions are closed, is likely to be lower yet.

Last year’s average sold price for the week was $126,631.

Of those duplexes that pended, just 10 percent were offered by traditional sellers. Last year, the week saw 24 percent of the small multi family inventory sold inventory not involve a lender in the negotiations.

However, traditional sellers did dominate the new inventory, bringing 51.5 percent of the week’s new listings to the market. This is up from last year, when 67.4 percent of the new listings required lender participation.

In the single family market, sales dipped with the holiday to 519 signed purchase agreements for the week. This represents a year-over-year decline of 38.2 percent.

There are currently 27,601 homes on the market in the Twin Cities; an increase of 9.5 percent from last year.

That’s an 8 month supply of inventory, representing a market heavily skewed in the buyer’s favor.

Comment

Mary Poppins said, “A spoon full of sugar helps the medicine go down.”  Since she was generally a pretty happy chick, I’ll go with her advice.

For the week ending September 4, 2010, 45.2 percent of the new duplex listings in the Minneapolis market were offered by traditional sellers. This is a healthy gain of market share over the 15.62 percent of sellers with human names for the same week last year.

The average off market list price of $136,725 is well ahead of last year’s sold price of $122,187. Of course, the price a property is listed at isn’t usually the price it sells at these days.

Now for the medicine. Of the 16 duplexes and small multi family properties that received acceptable purchase agreements, just 6.25 percent, or 1, was offered by a traditional seller. Last year, 20.7 percent of the 29 that pended did not involve a lender in the negotiations.

There was some sugar in the single family home market as well. The number of new listings was down 12.8 percent compared to last year at the same time. However, there were more properties that came on the market Labor Day week than had the week before.

Pending sales didn’t experience as much of a decline, but are nonetheless trailing last year’s by 35.9 percent.

Maybe if we all learn to spell supercalifragilisticexpealidocious, things will get better.

Comment

I added a new duplex to my “Five All-Time Favorite Duplexes” list yesterday. It probably also ranks as one of the nicest foreclosures I’ve ever seen.

The duplex is located in the sought-after Prospect Park neighborhood in Minneapolis, meaning it’s just blocks from the river walking trails and the University of Minnesota.

Built in the 1920s, it has two rare 3 bedroom units and all the character you’d expect from the era like built-ins, fireplaces (3), arched doorways and even an original Murphy Bed.

However, the previous owner added all the important upgrades like updated kitchens, a studio apartment in the basement, screened porches off the dining rooms, air conditioning and even an observation deck on the roof.

Still more rare is that it actually has a fenced yard big enough for a swing set or dog too big to ride in a purse.

The only problem with the place is it’s not my listing.

At $369,900,  it’s probably priced too high for an investor and feels much more like a duplex suitable for an owner-occupant. Nonetheless, it’s a terrific opportunity for somebody, because it’s truly special.

Call me if you’d like to see it. But hurry. I can’t imagine it will be on the market long.

Comment

OK, would everybody PLEASE put your duplexes on the market?

Call me crazy, but I have a long list of buyers and, believe it or not, there’s not enough good duplexes out there for them to chose from.

Now before you accuse me of having lost my marbles, the market data for the week ending August 28, 2010, backs me up. That week alone, the amount of new inventory that became available for sale was down 46 percent from the year before.

Of those new listings, 58 percent were offered by traditional sellers,  compared to just 35 percent for the same week in 2009.

Pended sales were down too, though at a 10 percent decline, not as dramatically. Of those property owners who accepted purchase agreements, just 7.4 percent did so without a lender involved in the negotiations. Last year for the week, 13.33 percent of the sellers could say the same.

Perhaps the decline in inventory contributed to the higher average off market list price for duplexes of $121,264.81; which is significantly above last year’s sold price of $86,228. Of course, the list price and sold price are rarely one in the same these days, so the gain may not be as significant as it first appears.

Comment

The Minneapolis real estate market is like someone who just can’t stop eating.

No matter how much it needs to not put another piece of chocolate in its mouth without also working out, it just can’t seem to keep itself from reaching for another piece.

For the last 12 weeks, the number of single family homes for sale in the market has been higher than it was a year ago; 8.1 percent higher to be exact.

And it’s growing because buyers aren’t out there to help work off the pounds of excess inventory.

For the week ending August 21, there were 601 purchase agreements signed. That’s 40.6 percent less than a year ago.

Duplex and small multi-family sales fared better however. While pended sales were down 10.7 percent year over year, the amount of new inventory also declined by 9.75 percent.

Of those properties that received purchase agreements, just 20 percent were signed by traditional sellers. This is down slightly from last year’s 25 percent. While the average off market price was $119,492, faring better than last year’s sold price of $113,148, it’s important to remember we won’t know until the sales have closed how near list price those transactions were for. In this market, odds are the “getting” price was below the “asking” price.

Traditional sellers brought 32.43 percent of the new inventory to the market for the week; a healthier showing than last year’s 22 percent of the new offerings.

1 Comment »

Some days, it’s tough for Realtors to get out of bed.

Today was one of those mornings, knowing as I did that the National Association of Realtors would be releasing their report for July existing home sales.

The news was worse than expected. Nationally, sales fell by more than 27 percent; the largest decline in 15 years.

Worse yet, Minneapolis lead the nation in declines, with sales down 42 percent from their mark one year ago.

August doesn’t appear to be faring any better. For the week ending August 14,  pending single family home sales were down 38.5 percent from last year.

In fact, over the last three months, there have been 5,812 fewer pending sales than there were one year ago over the same stretch of time.

Pending duplex and small multi-family property sales also declined 24 percent from the same week last year. Of those property owners who accepted purchase agreements, 74 percent were or had to involve lenders in their negotiations.

Traditional sellers eased ahead of foreclosures and short sales in the new listing category, bringing 53 percent of the listings to market.

The silver lining may be that while duplex and small multi-family sales were down, the average off market price of $126,742 was 11.9 percent higher than the sold price of last year.

Somebody wake me when this is over.

Comment

If the first time and repeat buyer tax credits were a housing party, then it’s fair to say the post tax credit hangover continued in the Twin Cities housing market for the week ending August 7.

Pending sales of single family homes continued stay in bed; down 36.5 percent from their mark one year ago.

With fewer sales, it’s natural that the amount of  inventory would continue to swell. In fact, there are 7.4 percent more homes available for sale than there were last year at this time. This month, there will be 8.64 homes available for every buyer in the marketplace. Last year, there was an average of just 5.28 for each buyer to choose from.

Duplex sales fared no better, with week over week sales dropping 25.6 percent from their 2009 mark. Of those duplex houses went under contract, just 13.79 percent were offered by traditional sellers. While this is an improvement over the 10.26 percent sold by parties other than banks for the same week last year, neither number is reason to celebrate.

However, it could be argued that the $118.224 average off market price for the pended sales is an improvement over last year’s sold price of $86,334, neither number is worthy of a party announcement.

Unlike single family homes, new duplex and small multi-family listings were down year over year by 31.8 percent.

While less inventory should ultimately put upward pressure on prices, and 7 percent more of the week’s new listings were offered by traditional sellers than last year’s figures, we’re a long way from anything resembling either price stability or appreciation.