A sharp increase in the median price of a home last month was one of several signs pointing to a return to a healthier housing market in the 13-county Twin Cities area, according to an analysis released today by the Shenehon Center for Real Estate at the University of St. Thomas’ Opus College of Business.
The university’s researchers, however, offered a note of caution. “We will need to see many more months of data before we can say that we are on the road to recovery,” said Herb Tousley, director of real estate programs at St. Thomas.
The Shenehon Center publishes a monthly Residential Real Estate Price Report Index that tracks median prices and other data for traditional home sales as well as the two kinds of distressed sales: short sales (homes sold for a price less than the outstanding mortgage balance), and sales where the home’s mortgage has been foreclosed.
Here are key findings from the center’s analysis of March data:
“These are all signs of the beginnings of the return to a healthier housing market,” Tousley said. He added, however, that the housing market in the Twin Cities still has a long way to go to get back to normal.
“One month of good data does not mean that our troubles are over,” he said. “Median prices and sales volumes will have to continue to exceed previous year’s levels for the balance of 2012.”
St. Thomas’ composite index uses nine data elements to track the health of the traditional, foreclosure and short-sale markets. Tousley described the March index as “a turnaround month” for traditional housing sales; the index moved from 895 to 908. The short-sale index increased from 723 to 741 while the foreclosure index remained unchanged at 610. The index scores reflect changes since the apex of the housing-market bubble in early 2005, when each category was assigned an index number of 1,000.
More details can be found on the Shenehon Center’s website.
Research for the monthly reports is conducted by Tousley and Dr. Thomas Hamilton, associate professor of real estate at the university. The index is available free via email from Tousley at firstname.lastname@example.org.