It would be easy to look at the data for the Minneapolis duplex market the week ending October 8, 2011, and decide all of the rays of sunshine we’ve seen in recent months had suddenly turned to rain.
In doing so, though, you’d miss the rainbow.
See, the sellers of just 13 listed duplexes, triplexes, and fourplexes received and accepted purchase agreements for the week. And of these, just 23 percent had enough equity in their property that they didn’t have to involve a bank in the negotiations.
This is down from the 23 property owners who chose to sell a duplex and accepted an offer on it during the same week last year. Of those sellers, 34.8 percent owed less to the bank than the property was worth.
But here’s the “good” news for duplex sellers.
There were just 29 new listings for the week ending the 8th. Of these, 41.4 percent belonged to equity sellers.
During the same week in 2010, there were 45 new listings for Minneapolis and St Paul duplex sellers to compete with. Of these, 42.2 percent took a check home at closing.
The difference between 29 new listings and 45 may not seem like a lot; that is, until you convert it to a percentage. It’s a 35.5 percent DECREASE in the amount of new inventory on the market — the trend we’ve been seeing all year.
In English? There are one-third fewer duplexes for buyers to choose from than there was one year ago.
The single family home market experienced a similar phenomenon for the week. There, new listings for the week were down 13 percent, and continue to be down 21 percent for the entire year.
Meanwhile, pending sales were up 48.3 percent over the same week from last year.
Prices posted their smallest decline since February.
And sellers received a higher percentage of their asking price for the second month in a row.
With interest rates below 4 percent for the first time in history, and tightening inventory, there’s plenty of sunshine in the Minneapolis real estate market to offset winter’s coming gloom.