Balance, in a real estate market, is when there is a 5-6 month supply of single family home and duplex inventory available for sale in a given market.
When this happens, both home and duplex buyers and sellers have equal leverage. In other words, a buyer can no longer beat desperate sellers up on price.
And, of course, sellers can’t crank up prices on buyers simply because there’s nothing worthwhile on the market for them to buy.
Heads up, those of you looking for a Minneapolis duplex deal…
Buried in today’s market report from the Minneapolis Area Association of Realtors was the following statistic:
In other words, in the Twin Cities, we’re .8 of a month from a balanced market.
In the duplex sector, there were 16 sellers who accepted purchase agreements during the week ending October 22, 2011.
Of these, 25 percent were traditional sellers who will leave the closing table with a check to spend on something else.
All of the other sellers will watch proceeds of the sale go to a bank.
Last year, there were also 16 sellers who accepted offers during that week. Of those, however, just 12.5 percent were going to have money left over.
Most of the duplexes this year left the MLS at an average list price of $106,982. This is up from the average sold price one year ago of $92,156.
Here’s where things get interesting. One year ago during the third week of October, there were 44 newly listed duplexes, triplexes and four unit apartment buildings for buyers to chose from.
The same week this year?
There were also 110 property owners who received Notices of Default in Hennepin and Ramsey counties alone this morning. This is up significantly from the daily averages of the last 8-10 months.
Looks like it’s going to be an interesting winter for Minneapolis duplex sales…