Weekly Market Activity Report

The first full week of reporting for the 2010 Twin Cities housing market is in and while there are a few “green shoots,” it’s becoming apparent so far that the market won’t see the same spectacular growth in sales it saw at the beginning of 2009.

There were 520 pending sales for the week ending January 9, down 1.7 percent from the same week in 2009. That’s the seventh week of the last nine to see slightly fewer sales than the prior year, a time period that coincides closely with the initial expiration date of the first-time home buyer tax credit. However, we’re still 21.2 percent higher than the pace in 2008 for that period.

As you likely know, the credit’s been expanded to include a $6,500 incentive for buyers who have owned a home for five years of the last eight. Since we can safely assume that many of these buyers will need to sell their home first before buying a new one and receiving the credit, new listings numbers might shed light on how much effect the new credit is having. So far, it doesn’t appear to be much.

Over the last three months, the number of new listings has been 11.7 percent behind the same period one year prior. With many looking for continued “seedlings” of hope in the local housing market, this isn’t welcome news. As always, we’ll be keeping a close eye on the evolving market and reporting back what we see.

Be Cautious of Pre-Approval Letters

Recently one of our clients in Hutchinson, MN had an experience with one of the “big” mortgage companies that I want to share with you.

They decided to sell the home they currently live in and buy a larger home. They went to the mortgage company and made loan application based on them selling their current home (which they were selling on a contract for deed.) They were also putting 30% down on the purchase of the new home.

The pre-approval letter they got from the mortgage company said that one of the conditions was that the contract for deed be executed. They and their buyer signed the contract for deed and it was recorded at the courthouse.

One week before they were scheduled to close on their new home, the mortgage company’s underwriting department denied their mortgage application for the new house stating that they “wanted one year’s history of payments made on time with the contract for deed.” The original pre-approval said nothing about payment history on the contract for deed, just that it needed to be executed!

Fortunately for this client, they had other resources so they were still able to purchase their new home, but needless to say, they were not happy with the mortgage company.

So, even though you have a pre-approval in writing with certain stipulations, be cautious because they could change their mind.

The Early Spring Market

As we anticipated, the Spring Real Estate market seems to have arrived early this year here in Hutchinson, MN. Despite the extra cold weather, buyers and sellers are anxious to get moving.

We expected this based on the fact that both the First-Time Homebuyers’ Tax Credit and the other Homebuyers’ Tax Credit require that buyers have a signed and binding purchase agreement in place by April 30, 2010 and close by July 1, 2010.

Sellers don’t want to miss out on any of the market time between now and the end of April, so they are calling to get their homes put up for sale as soon as they can.

With the interest rates still staying low, buyers and sellers are smart to get a jump start on the housing market.

Living in Hutchinson, MN

In the past I have been a bit of a cheerleader for living in Hutchinson and the wonderful community that it is. Today I want to share some personal reasons why I feel that way.

My husband passed away on Christmas Day peacefully at our home after a 20 month battle with cancer.

During the preceding two weeks that we cared for him at home, I had the good fortune to have  the pharmacist  making sure I got the medications that were needed, always asking how Joe was doing and then sharing a story about him with me. The doctor, who came to our home and checked on my husband.  When the end came for him, the police chief left his family (on Christmas Day) to come to our home along with the funeral director, who is also a good friend.  You can’t imagine the comfort in personally knowing every person who was involved in the care of my husband.

I have a couple of sisters who live in larger communities in other parts of the country, and they couldn’t comprehend that we personally knew all these people.

We had many friends who attended Joe’s funeral from all parts of the country and they were astounded at all that Hutchinson had to offer and how friendly the people in the restaurants, motels, etc. were.  

We can all be so proud of our community and the people who live here.