On the brink of the greatest Wall Street bailout ever, home prices continue to decline nationwide, according to the most recent S&P/Case-Shiller Home Price Index. Data released today reveals that 20-city home-price composite indices have reached record-level declines of 16.3 percent for the period of July 2007 to July 2008. In fact, every city was saddled with a year-to-year decline, with Minneapolis reporting a 13.1 percent price drop.
Minneapolis saw a slight increase in home prices from June of this year to July, with values rising by 1.3 percent. Yet the small uptick doesn’t portend a turnaround just yet: Home prices in the Twin Cities generally peak in summer months. Minneapolis’ home-price index is currently at 143.43, according to the report, down from its height of 170.34 in November of 2005.
Home prices from September 2007 through August 2008 in the Twin Cities are down 7.6 percent, according to the Minneapolis Area Association of Realtors, dropping from an average price of $274,870 for a single-family home to $254,028. Currently the Twin Cities have 9.9-month supply of homes on the market, a saturartion that hasn’t budged since last year. And condominiums are sitting on the market longer these days, increasing from a 10.8-month supply last year to taking more than a year on average to sell.
The good news in all of this? If you’re a buyer, the number of homes for sale under $120,000 has increased by 104 percent since last year. That’s positive news for affordable housing, which Minneapolis has been seriously deficient in for more than a decade. But it’s bad news for the hundreds of thousands of homeowners in the Twin Cities who are seeing their equity whittle away in the face of the housing crash and as foreclosures increase all around them.