The report is from the Minnesota Association of Realtors and it shows that in the 7 county metro area new listings and home sales are down. The length of time it takes to sell a house is down. Prices are up. On average sellers got 1.6% more than the asking price in February. That means that prices are rising.
Year to date sellers got an average of 1.4% of the asking price. This shows that prices are still going up.
Some buyers are making offers on houses without looking at them because houses sell so quickly.
The value of real estate is affected by location, condition, and size. If I take the same one bedroom condo and place it in four different areas the price will be different. Not only will the price be different but appreciation also varies by area and property type.
The table shows the average price of a one bedroom condo in 2018. The percentage is the average amount a one bedroom condo in each of the areas has appreciated since 2013.
Blanket statements about appreciation or real estate values are just a guide. The location and number of bedrooms, size, and condition of the property have a significant impact on value and future value for that matter.
Is this house a good investment is a great question and the answer has more to do with the situation of the person buying the house than it does with the house.
First, let’s assume that the real estate buyer is smart and savvy and pays fair market value or less for the property. We don’t know for sure if the value of the home will go up or down. Historically Minnesota real estate has appreciated . . . except for that one time when it dropped like a rock.
However, if a person has a choice between buying a home or using the money to start and build a business the business might be a better investment. Right now the tax breaks for businesses are bigger than tax breaks for homeowners too.
Owning a home for a short period of time can be more expensive than renting. Buying a home might not be a good investment for someone who needs to move often to take advantage of job opportunities.
For my family buying a house has been a great investment but we took a risk. We bought a house in an area that was experiencing some urban decay. Interest rates were sky high and people had trouble selling their homes.
The neighborhood has turned around and I guess we are on the way to gentrification. We bought low and yes it has been a very good investment. It wasn’t easy in the early days.
The question should be: Is this house a good investment for me at this time? Do I want to invest in a house or is there a better use of my hard earned money? Do I want to spend my money on stuff or on experiences or both?
Did you know that in Minnesota a person who sells cemetery plots needs a real estate license? I don’t sell cemetery plots and wrote this post 10 years ago. I found it while I was looking for something else.
We have some beautiful old cemeteries here in St. Paul. I guess I have always had a fascination with them because of they show the history of the city. Calvery Cemetery, located on Front Street in St. Paul is the oldest of the Catholic cemeteries. It was dedicated by Bishop Cretin in 1856, the oldest of The Catholic Cemeteries. Buried almost 101,000 persons since 1856, still currently averaging 290 burials per year. It is filled with beautiful monuments and old Oak trees. It is huge and very easy to get lost in. Oakland Cemetary founded in 1853 is a non-denominational cemetery. It is smaller the Calvary and there are a lot of civil war veterans and politicians buried in it. The oak trees are amazing, as are the monuments.
February was another record-breaking month as we set a new record for the all-time lowest number of homes on the market. Home prices continue to increase as supply decreases. Home sale prices were close to list prices or higher in some neighborhoods.
The data below is from the NorthstarMLS.
Eventually, there will be more homes on the market but no one knows exactly when that will be. For now, buyers need to watch and wait. There are people who want to sell but they either can not find the right home to buy or are afraid they won’t be able to.