1 Of Every 2 Homes Sold In TC = Foreclosure, Short Sale

MINNEAPOLIS (WCCO) — A new report paints a bleak picture of the Twin Cities’ housing market. According to the Shenehon Center for Real Estate, the median price of a traditional-sale home in the metro dropped 10.25 percent during 2011.

The University of St. Thomas’ Opus College of Business released the report Thursday. According to the report, the median price of a traditional-sale home in the 13-county Twin Cities market went from $212,250 to $190,500 last year. That’s a loss of $21,750.

A chart accompanying the report shows in January of 2005, the median price of a traditional-sale home was $232,500. That price dropped $42,000 in the span of seven years, by December of 2011.

“This data is in stark contrast to the 31.35 percent decrease recorded by the Case-Shiller Index between January 2005 and October 2011, which is the most recent Case-Shiller data available,” said Herb Tousley, director of real estate programs at St. Thomas in a press release.

Officials say the discrepancy is due to the St. Thomas index distinguishing between a traditional, normal market sale and a distressed sale — something the Case-Shiller Index does not.

The percentage of distressed sales continues to increase, from 48.8 percent in November to 50.18 percent in December.

The report states a healthy housing market will not be possible until the percentage of distressed sales consistently remains below 35 percent and traditional home prices stabilize.

  • Give me liberty

    This is a direct result of government intervention via Fannie Mae and Freddie Mac into the mortgage housing finance industry. Can’t wait to see how they improve our health care.

    Be afraid, be very afraid.

    • Mike

      The housing market crashed due to;
      REALTORS encouraging people to buy (and sell)
      Builders built more homes than were needed
      Lenders created poorly designed loan products to fill demand
      Borrowers took risky loans to get “more house”
      Sellers sold at crazy prices

      • snowfire

        Reality – our free market and those who manipulate (profiting from) it are the cause, the reality is that a building (or house) does not appreciate only the land it is built on can appreciate, the building depreciates from the day (roughly speaking) after construction is complete. The market (especially lenders) began attributing appreciation to the building and land and therefore many people were suckered into purchasing homes and expecting to turn (sell) them in a short time period and make a profit. The whole industry needs to share the blame. The 1% club drove this and knew what was going to happen, now they are making profits on the market correct period of foreclosures. Seems to have been staged as this is the only time this could have been pulled off as the baby-boomers were getting close to retiring at which time they would not need a bigger home and the bubble would pop. Regulation or no regulation the 1% are raking in the profits!

        • Chimp

          So if u build a 2bed 1 bath, or a 4bed 3 bath on next door lots they’ll appreciate the same? Can you know less?

      • Give me liberty

        Mike….how naive you are.

        Realtors were just doing their jobs.
        Builders don’t build homes they can’t sell.
        Lenders were regulated and told to make risky loans to unqualified borrowers or be subject to unfair lending practices.
        Borrowers took risky loans because they are stupid and greedy.
        Sellers sold their home for what they could, it’s call free market.
        Home values were inflated because of the artificial bubble government intervention caused.

        Fannie Mae and Freddie Mac went way out of their original charter and started buying riskier loans. Of course the lenders would make the loans knowing that FNMA and FreddieMac would purchase them. This pushed private mortgage companies to take even more risk. Fannie Mae and Freddie Mac thought they were too big to fail. Guess they were wrong and who is left holding the bag….the taxpayer. Government is way more corrupt than corporations because there is no accountability. They all have get out of free jail cards. You a fool if support big government.

        • what!?!

          @Give me liberty – GIVE US A BREAK! How delusional are you.. Freddie and fanny were doing their thing when the private sector got wind of it they lobbied and whined to congress about allowing them to be able to do the same. CONGRESS RELAXED the regulation law to allow the private banks to loan money to high risk folks. And guess what THEY MADE PLENTY OF IT through all sorts of derivatives schemes. And like every thing the private sector gets a hold of, they exploit it. Does the dot com of 2k ring any bells… So turn of FOX new and pick up a book and come back with some thing sensible for a change! Stupidity of our people = big government .. You want government to shrink then educate the dumb. The majority of bills that the government throw out there are in reaction to and even. the minority of them if a proactive measure.. SO let me ask you this .. Take government out of the picture.. take a small group of folks with all the power, smarts, and money in the world and put them up against a large group of folks who are hardly making it.. Who will win at the end?
          your rant = FAIL

  • Bill Clintons Cigar

    Everyone I know are walking away from their homes because they are underwater. One was $50,000 underwater. They are being punished for paying thier mortgage, so they have all said scr*w it. Their home values dropped by $50, 000 to $70,000 while their property taxes have gone through the roof in St Paul……so they are all walking away…

    • Stig

      How are they being punished for paying their mortgage? Didnt they sign an agreement to borrow x amount for x number of years and the payment would be x per month? How is this any different from any other investment? the value goes up and down. Unless they need to sell this year it really doesnt matter what the current value of the home is.
      Make the payments they agreed to make. Good luck getting into another house anytime soon if you just walked away from the last one. Cash will be king for you my friend.

  • Rufus Larkin

    Must be good news for the employment rate!

  • foreclosureofadreaM


  • SillyKids

    Thanks clueless people, I purchaed a 4bed 2 bath for $120,000 on a great lot near work, you poor saps who over extended yourselves have given me a bargain, half that got foreclosed on refinanced and blew the cash, so lets not blame the non-ignorant.

    • HDMC

      my 4 bed 2 bath corner lot 1.25 acres, 30×40 shop=105,000!!! thanks stupid people who cant control their spending! my 2200sqft house cost less than an apartment! my house was so cheap, my wife can now stay home and take care of our 2 kids!
      keep walking away, im looking at buying another house in my neighborhood to rent out!

  • Cheers

    Do the math, you either bought a home on an arm, or you sold your previous house for a profit during the boom and bought 1 you couldn’t afford. Why am I supposed to feel bad for you? You made your bed now lie in it.

  • Z

    Well said Stig. People panic and then walk away. If you don’t NEED to sell the house then don’t worry about it. Stay there, make your payments and in another 5 years the value will be back up. I am so sick of this entitlement attitude these days.

  • Rudy

    I think the censor on CCO needs to review the constitution and the bill of rights or go work in China. You’d be good, real good and making sure the facts aren’t written or ever heard.

  • http://dostiforever.in/blogs/post/16449 customer service

    customer service

    1 Of Every 2 Homes Sold In TC = Foreclosure, Short Sale « CBS Minnesota

blog comments powered by Disqus
Thursday Night Football

Listen Live