Monday, October 27, 2008

Reports came out today and new-home sales have fell to a 17 year low in the Midwest. Builders are trying to unload the inventory they have and new construction has slowed dramatically. It is becoming more and more difficult for builders to compete with all of the bank-owned properties that continue to come on to the market and discounted prices. Many of these homes were built just a few years ago and were part of what is now known as a "builder buyout." Builders were able to sell current inventory to investors who would make an arrangement with the builder to reap some of the profits of the sale. Then these homes were marketed to renters and eventually payments were not made and now many of these are back on the market at discounted prices as banks try and unload their inventory. Some large developments have gone completely under either through a fraud scheme like the Parish Construction scheme in New Prague or had too big of intentions like high-end developments in the Otsego or Hugo area. It still could be a year or more until we are able to get control of the number of bank owned homes on the market and see some sort of balance come back to our market.

Real Estate Market Update

Numbers came out yesterday from MAAR and pending sales continue to increase from last year. The number of homes on the market also continues to decline as the number of new listings last month was lower than a year before. With that said, it still remains a buyer's market. Rates continue to be favorable and money is still available for many types of buyers. Contrary to media reports there still are plenty of loan programs out there to help you buy a home. There are also down payment assistance programs available for many buyers who are looking to buy their first home. There are many fantastic deals out there and buyers are finding them, now is as good a time as ever to get into the Real Estate market. Finding a home and calling it your own is the biggest investment you will ever make. Feel free to contact me and we can discuss what options work best for you.