Real Estate Market Remains Ugly For Lakeville Homes

It’s no secret that the real estate market is bad. People need look no further than their property tax statements to know home values continue to slide. And for those hopeful that the first quarter of 2011 would usher in better news, plan on waiting a bit longer.

The Minneapolis Area Association of Realtors monthly report for home sales in Lakeville paints an all to familiar picture of the real estate market.

The median sale price for homes sold in Lakeville is down 21.6 percent according to the MAAR report, sliding from $245,000 to $192,000. The report also says those homes that sold did so after being on the market 18.2 percent longer than they did last year, averaging 153 days on the market, the report said.

Maybe those numbers are why there are fewer homes for sale in Lakeville. According to the report, the number of homes for sale is down 28.8 percent from last year.

The report reinforces what has been an ugly year for home sales in Lakeville, after what had been a recovery in sales and home prices post-recession thanks in part to huge tax incentives for buying a home. The market seemed to bottom out in June of 2009, when the median sale price for sold homes was shedding 20 percent. But by February of 2010, median sale prices were back on the rise, increasing nearly 10 percent for most of last spring. But by the fall, median sale prices were sliding again.

And it’s not just Lakeville. The Twin Cities real estate market continued its downward spiral in the first quarter, too, with new listings plummeting almost 25 percent compared to the first quarter of 2010, pending sales down almost 11 percent and the median sales price down almost 12 percent.

“These are a comparison to last year, which was a tax incentive year,” MAAR communications director Greg Sax said. “So the numbers are going to be down, no matter what.”

“At the same time, we are seeing that lender-mediated properties are still dominating the market. We’d like to see fewer of those, but it is what it is.”

The only slightly bright spot in the first-quarter statistics: The number of closed sales was up almost 1 percent in the Twin Cities.

But the other regional numbers added to the dismal picture:  The median sales price for a new home—the price at which half the homes cost more, and half cost less, as opposed to the average price— dropped from $162,000 in the first quarter of 2010 to $143,000 in 2011.

The percentage of the original list price fell from 93.5 percent in 2010 to 88.4 percent in 2011. In other words, houses listed for $100,000 tended to sell, on average, for $88,400. The average number of days between when a property is first listed to when an offer is accepted swelled from 132 days in the first three months of 2010 to 153 days in the first quarter of this year.

The number of new listings fell from 23,754 in the first quarter of 2010 to 17,845 during the same period this year. That number included newly listed lender-mediated homes—foreclosures and short sales.

In spite of the numbers, Cari Lynn, president-elect of MAAR, expressed optimism.

“Layoffs have decreased, and we are building on 13 consecutive months of job growth, which bodes well for local real estate,” she said in a statement. “In addition to new housing demand, we should eventually see the mortgage delinquency rate drop and fewer distressed sales pressuring prices downward.”

Sax also pronounced the real estate industry “cautiously optimistic” about the upcoming summer and fall.

“That’s where we feel like we’ll start to see some relief,” he said. “It isn’t going to be extreme, but it won’t be as trying as last summer.”