Spring housing market off to a strong start!

There's an upside to the nation's housing glut, fed by the crush of foreclosures: Housing gets more affordable.

In Minnesota, closed home sales were up 14.25 percent from one year ago, as indicated from the 13 county metro housing statistics released by the Saint Paul Area Association of REALTORS® today.

Nationwide, sales of existing homes rose 5.1% to 4.72 million from January to February - the largest sales jump since July 2003, the National Association of Realtors reports.
The surprising increase was driven by buyers taking advantage of big discounts on foreclosed homes. The median sale price was $165,400, down 15.5% from a year earlier and down 28% from their peak in July 2006.

First-time home buyers who could not break into the housing market in the boom years are prime buyers now that prices are at or near bottom and mortgage interest rates are below 5%.
According to Cindy Moynihan with Prime Mortgage, "the stimulus tax credit is working. We have seen a remarkable increase in the number of mortgage applications compared to last year and we have a number of clients that are in the pre-approval process ready to purchase a home". She goes on to say that "first time homebuyers have been given $8,000 that does not have to be repaid and they are ready to spend it."

Another good sign in this spring market is the decline in the number of new listings added to the overall inventory in the Twin Cities metro area. There were 7,870 new listings added in March compared to 8,523 in March 08, a 7.66 percent decline. Meantime, median sales price in the Twin Cites metro continues to search for its low point. The median sales price for a single-family, residential property in March 09 was reported at $154,125, a 22.94 percent decline from one year ago. The median sales price one year ago was $200,000. However, as inventory decreases and as buyers get motivated by low interest rates and tax credit programs, the median sales price could be close to reaching its floor. For the first time since July of last year the median sales price increased on a month-over-month basis by 2.75 percent. The median sales price one month ago was $150,000. Housing statistics include existing single family homes, condominiums and townhomes.

Statistics are provided by the Saint Paul Area Association of REALTORS® and are based on data supplied by the Regional Multiple Listing Service.

Pending Home Sales Offer Hope

For-sale signs have stayed in place a little longer with the persistent decline in home sales. But Tuesday brought good news: The pending home sales index nationwide rose 6.3 percent from November to December.

The national and local increases reported Tuesday are seen as good news for a depressed housing market.

By JIM BUCHTA, Star Tribune

Good news arrived for Main Street --and Wall Street -- on Tuesday when the National Association of Realtors reported that its pending home sales index nationwide rose 6.3 percent from November to December. That report helped reverse three days of declines for the Dow Jones industrials, lifting the index 141 points.

The Twin Cities got even better news. Actual pending sales in the 13-county metro area during January rose a robust 17.7 percent, marking the seventh consecutive year-over-year monthly increase, according to an analysis of data from the Minneapolis Area Association of Realtors.
While the latest sales figures are a bright spot in an otherwise gloomy economy, persistent declines in home prices, clogged credit markets and rising unemployment suggest that a full recovery might still be several months down the road.

"I would love to think that this is the bottom," said Mary Bujold, director of research for Minneapolis-based Maxfield Research. "But I don't know that right at this moment that I can be that optimistic."

The pending sale report is closely watched by many because it's an important indication of future activity. It generally takes two to three months for those pending sales to become closed sales, but in today's market, not every pending is going to become a closed sale the next month.
Yet other market indicators will continue to present challenges well into next year: Median sale prices are expected to fall at double-digit rates for several months to come, and getting a mortgage is still a challenge for many buyers. That's why the national group is lobbying the government for additional tax credits to help stimulate the market.

"Significant uncertainty still clouds the housing market despite improved affordability conditions," said Lawrence Yun, chief economist for the National Association of Realtors. "For a sustainable housing market recovery and, hence, sustainable economic recovery, we need a significant housing stimulus."

New listings coming on the market have steadily declined, reducing overall inventory levels. That includes the inventory of new homes as well.

The number of unsold new houses on the market in the seven-county metro area has fallen from 6,000 units during the first quarter 2007 to a little more than 3,200 by the end of 2008, according to data from MetroStudy. That translates into a 7.7-month supply of new housing.
In Washington earlier this week there has been debate about a plan to lower the interest rate on home mortgages to 4 to 4.5 percent and to stimulate borrowing by requiring Fannie Mae and Freddie Mac to purchase those mortgages from lenders.

There's also expected to be pressure from Republican officials to implement a $15,000 tax credit for home buyers. Already, a $7,500 federal tax credit that became available last year is getting some recognition for helping to lift the market.

However, more credit for the rise in pending sales is being given to distress sales, which accounted for 32 percent of all active listings in the Twin Cities metro area last month. Sales of those lender-mediated transactions, including foreclosures and short sales in which the lender forgives part of the mortgage to facilitate a sale, have been a drag on home prices. The median sale price of a traditional home sale last year was down 2.6 percent, while lender-mediated sales plummeted 19 percent, according to the Twin Cities association.

Pending sales don't translate directly into closed sales the next month. In November, for example, in the Twin Cities metro area, pending home sales rose 3.7 percent ahead of the same month in 2007. But in December closed sales rose almost 15 percent compared with December 2007.

Though such data aren't tracked regionally, some say that contract cancellations are on the rise. That's because in today's market, borrowers are more likely to discover after they've signed a contract that they can't get a mortgage, while others are making low-ball offers on bank-owned listings that can take many months to close.

The National Association of Realtors said Tuesday that the increase in pending sales in December was well above what economists expected.

Though declines in inventory and rising sales are good news for the market, broader economic challenges persist.

"People just don't know what's going to happen," Bujold said. "Uncertainty means that you don't go out and make any purchases unless you feel like you have to take advantage of it because it's not going to come around again."

Early Signs Of Foreclosure And Short Sale Slowdown

NEWS RELEASE

FOR IMMEDIATE RELEASE
Early signs of foreclosure and short sale slowdown-

Q4 2008 Update to “Foreclosures and Short Sales” report is released with exciting new interactive data tool Minneapolis, Minnesota (January 27, 2009) – Foreclosures and short sales in the Twin Cities housing market are showing early signs of slowing, according to a new research report released by the Minneapolis Area Association of REALTORS® (MAAR) based on data from the Regional Multiple Listing Service of Minnesota, Inc (RMLS).

During the fourth quarter of 2008, there were actually 4.3 percent fewer new lender-mediated listings than there was in the third quarter. That’s the first quarter-to-quarter decrease since 2003. As a result of this reduction in new supply and continued buyer interest in these properties, the total number of lender-mediated homes for sale dropped 600 units over the course of the quarter. This is only one quarter of downward movement, so time will tell whether the trend continues. Regardless, this has to be taken as a hopeful sign.

“By no means is the hard part totally over,” said Steve Havig, 2009 President of the Minneapolis Area Association of REALTORS®. “What the economy does in 2009 is the real wildcard, but the sooner this cycle runs its course, the sooner the housing market can return to some normalcy.”

New Listings
Lender-mediated home values are dropping quickly, while traditional homes are fairing better. The median sales price of lender-mediated homes in Q4 2008 was $131,000, a drop of 19.1 percent from the same time last year. The median sales price for traditional homes was $221,000, a drop of a much quieter 2.6 percent.

Despite the fall in new supply from last quarter, 42.2 percent of new listings and 46.0 percent of closed sales during Q4 2008 were lender-mediated. This is an increase from the same quarter last year, due in part to declining activity in the traditional market.

Edina Realty Mortgage

An Important Message from Todd Johnson,President and CEO of Edina Realty Mortgage

To Our Customers,

The dramatic events taking place in the financial services industry and economy are historic in scope and proportion. You may be asking yourself, “What does this mean for me as a home buyer or home seller? When I want to obtain a mortgage, will there be funds available?” The answer is simple: at Edina Realty Mortgage, it’s business as usual. Yes, we continue to originate mortgages for home purchases and refinances. Our wide product range features FHA, VA, MHFA, Conventional, Jumbo, Relocation, Renovation, and Reverse Mortgages. We are committed to helping as many customers as possible enjoy the personal and financial benefits of homeownership. We provide competitive, fully disclosed, and responsible and fair pricing for all borrowers.

A Solid, Stable and Secure Lender

We want to assure you that we remain a solid, stable, and secure mortgage lender. We are a well-capitalized company, and we hold fast to our long-standing responsible lending principles. Edina Realty was one of the first real estate companies to offer integrated mortgage services more than twenty-five years ago. For over ten years, Edina Realty Mortgage has been a joint venture between Wells Fargo Home Mortgage (a division of Wells Fargo Bank, N.A.) and HomeServices of America, a Berkshire Hathaway Affiliate. Wells Fargo Bank, N.A., is the only bank in the United States, and one of only two banks worldwide, to have the highest credit rating from both Moody’s Investors Services “AAA,” and Standard & Poor’s Rating Services, “AAA.”

We Are Committed to Your Successful Closing

We stand by our word. Our exclusive On-time Closing Guarantee (1) ensures that you will close on time AND for the amount quoted on the Good Faith Estimate, or you will get money back. Are you already working with another lender? We will be happy to review your Good Faith Estimate and Truth-in-Lending Disclosure Statement. This no-obligation second opinion from us takes just few minutes, and we may be able to provide reductions in interest and/or closing costs.

As a responsible lending leader, we work closely with our customers to help you reach your personal and financial goals through homeownership. Our team works hard to know you, understand your needs, and listen to you. We put you at the center of everything we do.

Thank you for trusting us with your business.

Todd JohnsonPresident and CEO

1. Available on all qualified purchase transactions. Other terms and conditions apply. See a Home Mortgage Consultant for details.
2. If you have a current lock-in agreement with another lender, this is not an inducement to transfer your loan.
All first mortgage products are provided by Homeservices Lending, LLC Series A dba Edina Realty Mortgage. Edina Realty Mortgage may not be available in your area. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. ©2008 Edina Realty Mortgage. All Rights Reserved.

Homeowners Battle Rising Utility Costs

Savvy homeowners are battling all-time-high energy costs by incorporating building techniques to make their homes more energy efficient. As more people begin to struggle to meet rising utility costs, these practices are expected to grow in popularity.

Just as current owners are renovating with energy savings in mind, new home builders are seeing increased demand for green buildings and energy-efficient homes.

Here are some ideas for how you can reduce your energy consumption – and costs – by selecting building materials and appliances that promise to improve your home’s energy efficiency.

Use Highly Rated Energy-Star Appliances: This is not a new idea, but as costs rise, buyers are looking at the yellow energy-consumption tags on new appliances more seriously. Retailers know that buyers are paying more attention to the higher-rated appliances, and this could lead to more advertising and discounts for such products.

Consider How You Heat Your Water: Most homes have a traditional tank-style water heater. However, with rising heating costs, this practice may change. Other options for heating water in your home include solar heating and tankless water heaters.
Solar water heating requires a significant upfront investment, but once it is installed you no longer need to pay for heating the water. Installation includes a pump, plumbing through which the water circulates for exposure to the sun, and possibly large glass tanks for storing the hot water.
A tankless water heater has no storage tank and the water is heated as you need it. Heating water on demand is much less expensive than heating water and storing it until it is needed.

Supplement Your Electricity: Installing photovoltaic roof shingles instead of standard asphalt shingles lets you use the sun’s energy to generate supplemental electricity for your home. A wire is pulled from each shingle and connected to the home’s power grid. You might not be able to generate enough electricity to meet all your needs, but with rising costs, every bit of savings can be a huge help to homeowners.
If you are considering a new roof or you are building a home, consider using this roofing material to decrease your utility bills.

Consider Your Home’s Placement: If your home was built 50 or more years ago, it probably is already more energy efficient than most new homes. This is because central air-conditioning was not prevalent in the past. To keep homes cool in the summer, windows were located strategically for cross-drafts. Also, the largest windows were designed to receive the morning sun, thereby helping to heat the home.
As energy prices declined, many homes were built without these considerations. However, today’s builders are beginning to return to traditional building practices in order to have more energy-efficient homes.

Consider Your Window Treatments: Whether you live in a new or old home, or are building your home, you can control your window treatments. What you put on your windows can make a serious different in your home’s heating and cooling costs. Light- and heat-filtering blinds and heavy draperies may significantly reduce the need for continuous air-conditioning.

Hopefully, this information has given you some ideas for countering rising energy costs. By using one or more of these suggestions, you can make your home more energy efficient. If you decide to sell your home in the future, these updates may make your home more attractive to buyers.

This is an excellent window cleaner that costs about a quarter per bottle. Use it with newspaper for a clean you won’t believe!

Window Cleaner Recipe (Compliments of Heloise)
12 to 16 ounces water
1/2 cup white or apple cider vinegar
1/4 cup rubbing alcohol (70%)
1-2 drops blue or green food coloring, if desired1-2 drops lavender, cinnamon, clove or orange essential oil.
Combine the ingredients and pour into a labeled spray bottle.
1. Spray the newspaper.
2. Wipe down the window to avoid drips.
3. Wipe one side of the window vertically, and the other horizontally, so you will know which side a streak is on!
This bottle of nice-smelling window cleaner can cost as little as 25 cents. The solution also works well on mirrors and glass shower doors.

Fire Safety!

TAKE THE FIRE SAFETY QUIZ (answers at the bottom)!!
Fire Prevention Week Quiz
"It's Fire Prevention Week October 5 – October 11. Prevent Home Fires is the theme for 2008!"
Your home should be a safe haven. But do you regularly check for home fire hazards? If not, there is the potential for danger. Take this new Fire Prevention Week quiz and see how many questions you can answer correctly. Good luck!

1. The leading causes of home fire deaths are:
A. Cooking and heating.
B. Cooking and electrical.
C. Smoking and electrical.
D. Smoking and heating.

2. You should stay in the kitchen when you are:
A. Baking.
B. Frying.
C. Simmering.
D. Steaming.

3. Most heating fire deaths are caused by:
A. Chimneys.
B. Furnaces.
C. Space heaters.
D. Wood stoves.

4. You should never smoke in a home with:
A. Gas heat.
B. Older adults.
C. Oxygen in use.
D. Paper clutter.

5. When you leave a room in which there is a candle burning you should?
A. Blow out the candle.
B. Move the candle away from anything that can burn.
C. Take children and pets with you.
D. Check the candle frequently.

6. Smoke alarms should be replaced every?
A. 5 years.
B. 10 years.
C. 15 years.
D. 20 years.

7. Smoke alarms should be placed in?
A. Bedrooms, outside sleeping areas and kitchens.
B. Bedrooms, outside sleeping areas and on every level of the home.
C. Kitchens, outside sleeping areas and on every level of the home.
D. Outside sleeping areas and on every level of the home including the attic.

8. Space heaters should be how many feet from things that can burn?
A. 1
B. 2
C. 3
D. 4

9. To prevent electrical shocks in the bathroom you should have?
A. Arc Fault Circuit Interrupters.
B. Circuit Breakers.
C. Ground Fault Circuit Interrupters.
D. Tamper Resistant Receptacles.

10. You should call a professional electrician when?
A. Your circuit breaker trips.
B. You lose your electricity.
C. You purchase a home.
D. Your outlets are warm.

11. A home fire escape plan must show?
A. Two fire escapes from each level and an outside meeting place.
B. Two outside meeting places and the fire department phone number.
C. Two ways out of the home and an outside meeting place.
D. Two ways out of each room and an outside meeting place.

12. If there are smokers in your home, they should smoke
A. In the kitchen.
B. In the basement.
C. In the garage.
D. Outside the home.

13. Extension cords should be
A. Used only if it has the label of a recognized testing laboratory and following instructions provided.
B. Secured under furniture so it is out of the way.
C. Placed under a carpet so it doesn't get damaged.
D. All of the above.

14. Heating equipment should be inspected
A. Every year.
B. When you move into a house.
C. When it's not working properly.
D. All of the above.

15. If the oil catches fire in a pan while cooking, you should?
A. Carry the pan to the sink.
B. Put the fire out with baking soda and turn the burner off.
C. Throw water on the pan and turn the burner off.
D. Slide a lid over the pan and turn off the burner off.

ANSWERS:
1. Smoking and heating
2. Frying
3. Space heaters
4. Oxygen in use
5. Blow out the candle
6. 10 years
7. Bedrooms, outside sleeping areas and on every level of the home
8. 3
9. Ground Fault Circuit Interrupters
10. Your outlets are warm
11. Two ways out of each room and an outside meeting place
12. Outside the home
13. Used only if it has the label of a recognized testing laboratory and following instructions provided
14. All of the above
15. Slide a lid over the pan and turn off the burner off

Looking To Sell?

Here are some tips to get your home ready!

Fence:
Replace missing slats, stakes and posts.
Repair broken hinges and paint or stain the fence if necessary.

Yard:
Mow, trim and fertilize lawn.
Weed flower beds and replace dead plants and trees.
Driveway and garage:
Clean up grease or oil spots on concrete surfaces.
Make sure the garage door opens freely and the automatic door opener is working.
Provide an unobstructed view of your home from the street by not parking cars, boats or other vehicles in the driveway.

Front Entry:
Polish door handles and door knockers.
Replace worn or broken items, such as an unsightly mailbox or rusty doorbell.
Be sure porch lights are working and add welcoming features such as a new door mat and flowering plants.

Siding and Trim:
Consider painting the highlight features of your homes, such as trim work, shutters, gutters, down spouts and railings.
If necessary, add a fresh coat of exterior paint to the siding.

Roof:
Remove debris such as tree branches and leaves.
Make any necessary repairs to worn shingles or cracked surfaces.

Patio and Deck:
Flowering plants and outdoor furniture add appeal.
Remove any unnecessary items such as gardening equipment.
Tidy any visible items, such as an outdoor grill or barbeque.

Doors and Windows:
Consider adding a fresh coat of paint to your front door.
Polish brass fixtures and be sure door locks work properly.
Oil hinges to both doors and windows.
Keep stairways tidy and secure handrails.
Repair or replace bent or damaged screens and window glass.
Cut back outdoor plants that restrict natural light.
Keep windows clean and tidy with draperies firmly affixed and in proper working order.
Repair or replace missing or damaged tile, hardwood, vinyl and baseboards.
Steam-clean or shampoo carpets.
Secure loose carpeting and replace damaged areas.
Be conscious of odors caused by dampness, high-traffic areas or pets.

Closets and Storage Areas:
Ample storage space increases the desirability of the home.
Keep closets tidy.
Discard any unnecessary items and consider storing those things you do not use frequently.
Remember that less is more!
Bedrooms and Living Areas:
Keep living areas clean and inviting.
Arrange furniture to allow a spacious at atmosphere.
Make beds, arrange couch cushions, dust shelves, vacuum carpets and touch up walls with paint or spackling as necessary.
Wallpaper should be clean and adhere smoothly to walls.
Finishing touches such as flowers or candles add to the home’s appeal.
Remember that less is more!

Kitchens and Bathrooms:
Clear counters, drawers and cabinets of unnecessary items.
Clean soap dishes, mirrors, faucets, and appliances (inside and out).
Store cleaning supplies and hang freshly washed towels.
Be aware of and eliminate odors caused by dampness and hampers.
Remember that less is more!

Counters and Cabinets:
Store infrequently used counter-top items to allow a spacious look in the kitchen and bathroom.
Keep drawers and cabinets tidy and organized.

Garage and Workshop:
Items should be neatly stored in the shelving or wall units.
Allow appropriate space for the home buyer to visualize their vehicle or workbench.
Consider moving excess or over-sized items to mini storage.