Who Has the Opportunity Today?

December 31, 2012 by · Leave a Comment 

Granted, wintertime in Minnesota is tough time to get a good read on the local housing market.  That stated, there has been a trend of positive news over the past several months, hinting that the housing market had bottomed out early last year and better days are ahead of us.  Shrinking housing inventory (real or REO withheld), increased sales to owner-occupants, continued low-interest rates, and a constant heavy volume of interested buyers in first-time homebuyer classes are give validity to the news http://www.startribune.com/business/183275271.html.

So, what does this mean?  I don’t believe we are going to see the huge home value increases we saw in 2004-2006, but values will continue to increase and appraisals will begin to catch up with the market realities. Households who purchase today will have more certainty that their home will at least not lose value between today and a year from now and more people will again consider homeowneship.  That fear had kept many households on the sidelines for fear of a poor financial decision.

When I first started with the City of Lakes Community Land Trust, I felt like folks were critical of us for not getting the organization operational earlier when the housing market hadn’t yet taken off so that we could have assisted more households.  Well, we’re hear again.  We are at a time and place that affordabilty is by far the greatest we’ve seen in decades and yet low and moderate-income households are facing a far more difficult time getting into homeownership.  Sure, some of this is due to “less-than-stellar credit” and mortgage lender underwriting has become much more stringent (some of this was definitely needed), but we really need to look at what has worked in creating and sustaining affordable homeownership in our communities and invest more into it now as the public investment today will be a fraction of what it will take in just a few year’s time. 

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