Twin Cities home prices show steady gains
Home prices in the Twin Cities rose over four straight months in the period ending in August, according to new data released Tuesday.
The Standard & Poor's/Case-Shiller home price index showed Twin Cities prices increased by 2.3 percent, which was the second largest percentage increase among 20 major U.S. cities. San Francisco prices increased by 2.6 percent in August, according to seasonally adjusted numbers.
According to a separate set of numbers that were not seasonally adjusted, the Twin Cities had the highest percentage increase at 3.2 percent.
Gains for four straight months mean home prices in the Twin Cities have risen 8.7 percent since April, according to the seasonally adjusted numbers. But overall prices are still down 13.8 percent from a year ago.
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Twin Cities home prices peaked in April 2006 and fell through spring of this year before beginning to rise again.
Nationally, the index went up 1 percent in August with prices down 11.4 percent from a year ago. The index showed only four cities (Seattle, Las Vegas, Cleveland and Charlotte, N.C.) had decreases in home prices.
Increases in the Twin Cities market could mean the percentage of bank-owned sales is declining more than in other markets, said Brad Fisher, president-elect of the Minneapolis Area Association of Realtors.
"It's tough to predict going forward. But as we run out of bank properties to sell, that average price will probably creep up a little more," he said.
In January, about 60 percent of real estate agents' sales were bank owned. The percentage has gone down to around 25 percent.
The Minneapolis Area Association of Realtors reported a slight decline in the median home price in September, and Fisher expected the Case-Shiller index might also show a small decline when numbers for September are released next month. The overall increases are expected to continue, he said.
"I think we have seen the bottom," Fisher said. "We'll probably just see a natural migration upward in prices. Not tremendous, but just more stability."
First-time homebuyers have through November to take advantage of a credit of up to $8,000 from the federal government, and Congress is debating whether to extend the benefit.