Metro median home sales price increased 4.7% to $219,900 in the month of June, encouraging Twin Cities home sellers to jump into housing market activity, enjoy the benefits, and invest in another Twin Cities home.
July 8, 2014
The Twin Cities housing market has just experienced 28 straight months of median Minneapolis home price gains as fewer distressed property listings comprise an increasingly shrinking portion of home sales. In June, bought Twin Cities distressed properties made up 9.5 percent of available real estate listings and 12.6 percent of closed sales, the lowest numbers since 2007. With fewer distressed properties driving down home prices, home price growth has remained positive.
One example of how fast some Twin Cities homes sold this spring is found in an article titled Top Residential Transactions: Mid-century lake home sells for $2.515 million. A more traditional home of modest size, the home gained multiple offers and skipped the norms of selling after being listed.
Banks Balk at Risky Lending
Individual and investment homebuyers with financing or cash are snapping up prime Twin Cities real estate listings. Less credit worthy buyers face challenges to compete. TwinCities.com talked yesterday about the 'unintended consequence' of Citigroup's $7 billion settlement after its handling of risky subprime mortgages. Some would-be homebuyers who are seeking a mortgage find that lenders are withdrawing from lending to to applicants with college debt or less than stellar credit. "Banks won't go near those customers because, in our opinion, the severity of the penalties that they paid," said Gerard Cassidy, a managing director and analyst at RBC Capital Markets.
Home Price Growth - Why Invest in a Twin Cities Homem
MetroStudy's latest focus on the Twin Cities housing market says housing norms experience both good times and bad times. Twin Cities home price growth definitely represents positive times. "This creates some balance in what has otherwise been an unbalanced market for much of the last 10 – 15 years. Simply put, today’s housing market is healthier than it has been in over a decade."
Twin Cities Investors Watch CoreLogic's Home Equity Report for Q1 of 2014
According to CoreLogic's Home Price and Home Equity report released July 2014:
The national average of Home Equity Share is 87.3%; the Twin Cities stand ahead at 90.3%.
The national average Loan to Value is 60.8% and the Minneapolis metro ranks at 63.5%.
The national Near to Negative Equity Share (100% - 105%)is 2.4% and the Twin Cities is 2.5%.
The national Near to Negative Equity Share (95% - 100%)is 3.2% and the Twin Cities is 3.3%.
TOP REASONS TO INVEST IN TWIN CITIES REAL ESTATE
The Twin Cities housing market drawns investors due to the following high points:
* Fewer high and low market swings
* Diverse economy
* Affordable home prices and reasonalbe cost of living
* Minneapolis is also within short distances of relaxing places like Lake Calhoun, Lake of the Isles and 20 other lakes in within the city.
* Healthy and well-educated workforce with strong income earnings
* Strength within manufacturing sectors that generate jobs and a balanced economy
* Cutting edge real estate with green homes available
* Rich with the arts, culture and outdoor living experiences.
Twin Cities Residential Investors Have Stiff Out-of-State Competition
Prospective Twin Cities real estate investors who engage in buying residential home to accure equity have stiff competition from out of state investors. Whether you are a cash buyer or have the financing for a home loan, now is a great opportunity to purchase a home with the intent keep the property as an investment and sell later. Today's brisk home sellers’ market is the moment for many to sell. For those who aren't Twin Cities cash buyers, and plan to let it rest in a bank account, then no action may need to be taken.
To generate real estate returns, successful investors have a plan and the financial gains above any amount borrowed in the process. Being able to see the process from purchase to placing the home back on the market, includes negotiatinng a good home re-sale price that culminates seein the bottom lines make sense at closing. Seasoned Twin Cities real estate investors take into account paying all selling expenses including commissions, transaction fees and mortgage balances.
Talk to your tax account before borrowing any amount of the home's value and be clear on the dollar amount you have to work with on each property.
Location has Everything to do With a Strong Residential Investment Protfolio
Buying a home for gains in an investment portfolio should include properties on great residential streets. Location will have a greater impact on the home's sale price come time to sell than any other factor.
"You have many investment options, but if you want to stay in real estate, you will most likely either look for another rental property or get into private lending. Another rental is likely a fantastic option for you, but with it being so tough to find them, it might make since to get into private lending now while you wait for the market to shift again. With private lending, you should be able to earn 8% or more. If you are $ house working with a professional, 8% is probably in the ballpark of what you should expect," says Pine Financial owner Kevin Amolsch.
Residential Investors Start with an Accurate Appraisal
Depending on the individual investor and thier strategies, renovating homes has gone both exceptionally well and sour in recent years. As often happens, the sour stories gained an oversized load of publicity. Understanding grounded cautions and conducting aggressive research in advance carries huge benefits for prospective real estate investors, giving them a great chance to step into the real estate market and gain the opportunity others have to make money over a reasonable period of time. It takes clear readings on Minneapolis real estate demographics to best manage home renovations; even seasoned investor know that selling a home for a big profit can never be guaranteed. Selling a Twin Cities home after gaining sufficient equity, is a dream come true for many.
Every home transaction benefits from careful calculations using a Mortgage Calculator to obtain a fair idea of an investor's chances for profit. The work of understanding the real costs of renovating a home helps investors be more accurate in forecasting whether a making each investment is worth the time and financial resourses. Plenty of real estate investor warnings are frequenlty posted to help future investors make sure that they understand what deserves adequate attention.
Real estate requires attention, and for those who love and know, that becomes a pleasure. Real estate investors who keep appriased of their tax advantages and the climbing values of rental real estate income find other forms of investment just don't beat it. It is important to see past the math homework of home renovating; being able to apply the insights to make a home purchase with informed decisions is the defining factor that sorts the top real estate investors who thrieve from those that fail over time.
Things to Consider Before Investing in A Twin Cities Property
Key areas to look at before investing in the Twin Cities real estate are:
Individual Twin Cities neighborhood crime statistics
Behavioral reputation of individual neighborhood
Code-enforcement issues that may impact real estate issues.
"We’re a market that people didn’t pay much attention to before. But now some of these institutional players are looking for a place where they can put a good chunk of their money to work." ~ Herb Tousley, director of the Shenehon Center for Real Estate at the University of St. Thomas
Download the Minneapolis Area Association of Realtors Snapshot of the Minneapolis Housing Market for May 2014
Down load MetroStudy's Minneapolis Home Prices and Equity Report for Q1 2014
Whether you are relocating to the Twin Cities or simply seeking to move to a home with sufficient size for more family members, call me at 612-396-7832. I would be honored to represent your interests and help you find the ideal Twin Cities home to buy to raise a family.
Jenna Thuening, a Twin Cities residential Realtor brings readers tip on how to invest in a Twin Cities home and generate retruns of profit.
Eden Prairie MN 55344
Jenna's home page: homedestination.com
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