Twin Cities Homebuyers Move Fast on New Home Listings: Yale University

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Robert Shiller released new commentary on his recent Yale University study, comparing why homebuyers move fast on new home listings today with the pre-housing boom homebuyer activity. Home Destination, a Twin Cities professional Realtor with RE/MAX Results responds to the Shiller's comments and the confidence Twin Cities homebuyers have in the metro's housing market.

Twin Cities Homebuyers Jump on Scarce Real Estate Listings

Twin Cities Homebuyers Move Quickly

"Developers have gone from buying foreclosed acreage from banks to buying from farmers, family trusts, manufacturers and even homeowners with outdated homes on single lots." ~ TwinCities.com

Twin Cities homebuyers move fast on new home listings, becoming a prime example of Robert Shiller's recent remarks on hot housing markets. Published on September 28, 2013 in the New York Times, Robert Shiller's Housing Market Is Heating Up, if Not Yet Bubbling article is drawing strong remarks from additional housing commenters on the pace on new home sales and homebuyer activity.

"Buying a home now seems logical to Twin Cities homebuyers who perceive that we are recovering from a recession and home values are climbing upward," says Jenna Thuening, owner of Home Destination. "Families seem less prompted by thoughts of another housing boom; they more likely are considering that if mortgage rates continuing to rise, now is a great time to buy a home."

Considered an authority on real estate along with Karl Case of Wellesley College, the two developed the S.& P./Case-Shiller Composite-10 Home Price Index. Shiller boldly states that "home prices in the United States were up 18.4 percent in real, inflation-corrected terms in the 16 months that ended in July. Results suggest that though we are not in a bubble now, there are troubling signs that we may be heading toward one". He concludes with, "But whether these attitudes mutate into a national epidemic of bubble thinking — one big enough to outweigh higher mortgage rates, fiscal austerity in Congress and other factors — remains to be seen".

The Yale University Study brings us a clearer focus on the role of homebuyer expectations, according to HousingWire's comments on Shiller's article. The study looks in depth at what homebuyers have in mind when they buy a home. At the time of purchase, a buyer of a capital asset is buying a flow of services and benefits that will all come in the future, and the future subject to market fluctuations and world wide economic influences. Buying a home involves several careful steps make buying decisions that will in all likelihood affect the buyers’ lives dramatically. It is easy enough for anyone who recalls signing a purchase offer agreement on a home, and handed over that carefully saved home down payment check, to relate to the magnitude of real estate purchasing decisions.

"The Twin Cities housing market has done a remarkable job of avoiding the high and low's experienced in recent years in many residential housing areas," adds Thuening. "Homebuyers are moving quickly on new listings, however, they are better informed and more confident of their purchases will increase in value."

Shiller made similar comments a year ago, pulling together supporting housing data for his view on homebuyers fast-paced activity on new real estate listings. "When asked whether they agreed with the statement, 'It is a good time to buy a home because prices are likely to rise in the future,' the vast majority of respondents said yes. In every single survey in every county, the share agreeing with the statement was never less than 67 percent, and in most it was over 80 percent. Buyers are optimists," he stated in the fall of 2012.

Weekly reports from the Minneapolis Area Association of Realtor's continue to show the confidence of Twin Cities homebuyers and brisk buying activity.

According to the MAAR, in the Twin Cities region, for the week ending September 21:

  • New Home Listings increased 13.3% to 1,469
  • Pending Sales decreased 5.5% to 970
  • Housing Inventory decreased 6.8% to a total of 16,249 homes listed

Housing data summary for the month of August:

  • Median Home Sales Price increased 16.9% to $207,900
  • Days on Market decreased 34.0% to 70
  • Sellers Percent of Original List Price Received increased 2.0% to97.0%
  • Months Supply of Inventory decreased 18.2% to 3.6

Twin Cities homebuyers seeking new home listings benefit from a local Realtor who works hard to find new real estate listings that match client wish lists. Call 612-396-7832 to reach Jenna Thuening for professional real estate guidance on a top priority basis.

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