Minnesota Foreclosure rates

Minnesota foreclosure rates for 2010 show trouble still brewing in the Minnesota housing market. The Minnesota Home Ownership center reported that there were 13,093 foreclosures in Minnesota at the end of the second quarter. This compares with 11,089 for the same time period in 2009. The highest level of foreclosure rates in Minnesota occurred in 2008 with 26,251 Minnesota foreclosures that year.

Julie Gugin, executive director of the Minnesota home ownership center states, “this report does not predict the future, but it does provide a look at current trends and shows that we’re not out of the woods yet. It is another indicator that we have a long, slow recovery ahead of us.” She also said that there are some counties that may see double digit increases in the number of Sheriff’s sales in 2010.

I learned today that the Minnesota home ownership center is a fantastic resource for people struggling with their mortgage payments, as well as people who are first time home buyers. They can be a valuable resource of what to do strategically and what are their best options. They can help negotiate with the banks, whether it be a loan modification, short sale, deed in lieu of foreclosure, or perhaps even foreclosure.

The high rate of foreclosures in Minnesota are one of several factors into a predicted drop in home prices in the future. Moody’s recently predicted Minneapolis will see a two to eight percent price decline by July 2011. The leading indicator that I think will be a driving force in the housing market is the employment rate. It is my belief that the employment situation will have a direct impact on the foreclosure numbers which will then help to stabilize home prices in Mn.

Time and again I hear home sellers make the comment that they ‘need’ a certain price for their home. The reality is that housing prices are a market, no different than other commodities, stocks or what have you. Home prices are driven by supply and demand, and currently demand is still soft due to buyer’s comfort level with their jobs and the economy in general.