In Minneapolis Foreclosure Suffering Increases

August 19th, 2008 | Tags: Foreclosure

According to realtors, in Minneapolis foreclosure suffering is increasing. The foreclosures number and bank repossessions in the region of the Twin Cities doubled from what it was in the previous year. The traditional listings have fallen by 16% in the second quarter according to Minneapolis Area Association of Realtors.

The focus of the report is on the MLS of the region and on those units for which the banks have given permission to be sold off at a value less than the mortgage amount. This is known as a short sale. Over 20% of the houses waiting to be sold are from the foreclosure category or short sale group. This is an increase of about 10% from the previous year. Generally very low prices are offered for the foreclosed houses and for those in the short-sale bracket.

Aaron Dickinson of Edinay Realty helped in compiling the statistics. He said that it seems that lenders and the banks are offering huge discounts to attract buyers. The average sale price of listings that are made by the lender has dropped by 11.7% since the previous year; that of the conventional houses fell by 3.4%. The banks seem to have made up their minds not to sit on the properties any longer but to let it go and clear their listings. “They’re starting to price more aggressively to get this inventory off the books.”

During the second quarter many regions that had been hard hit by foreclosures showed increase in sale of houses. The prices had fallen dramatically. It pointed to the fact that lenders are more proactive and eager to offload the weight of these units.

In Nevada the sale of houses during the second quarter increased by 18% from what it was in the second quarter 2007. In Las Vegas the average price of a house dropped by 24% according to the findings of the National Association of Realtors. The report further stated that the average price of houses fell by more than three quarters in all the cities of the country. In Minnesota the fall of price was by 10.8% while in the Twin Cities it tumbled by 7.2% according to this report.

Across the country foreclosure rates however continued to gallop according to RealtyTrac. It rose in July by 55% compared to July of the previous year. This calculated to a rate of 1:464. Minnesota ranked 33rd in the national foreclosure rate.