Tag Archives: twin cities

Homes by Tradition wins two Reggie Awards for Spirit of Brandtjen homes in Lakeville


The Fall Parade of Homes has finished a successful year.  Many areas have reported great traffic at their model homes showing positive signs that we have rounded the corner on the market.  With the close of the Parade of Homes comes the announcement of the winners of the Reggie Awards.

From the Builders Association of the Twin Cities (BATC):

For more than 40 years, local builders have coveted the Reggie Award statue more than any other. And for 20 years Associates and Builders have entered the Trillium Awards together to showcase their successful partnerships. Winners are selected by judging teams of builders, associates and consumers who visit homes within their category and meet together to select the best example of excellence in design, construction quality and value. Reggie Awards are given to the Builder.

The Trillium Awards were established to honor our associates for their partnership with builders. As Reggie winning homes are judged the very best, so now the Trillium Awards will be given to all entered participating associates in a Reggie-winning home. The winners of this Falls Parade of Homes were announced.

I wanted to focus  on one builder in particular, Homes By Tradition.  The reason I want to focus on them is because they won not just one Reggie Award but they won 2 Reggie Awards in this Fall Parade of Homes.  In my opinion, they design and build some of the nicest new homes in the Twin Cities.

click on image to enlarge

The first award they won was for their model at Spirit of Brandtjen Farms in Lakeville, MN.  The model is at 18641 Draft Horse Blvd. Lakeville.
This home is a beautiful “farmhouse” style in the superb setting of their Spirit of Brandtjen Farm community.
This home won the Reggie Award is the $355,000 – $384,999 class. The Trillum Winners for this home were won by Aspen Electric Inc, Glowing Hearth & Home, and Southern Lights.

click on image to enlarge

Homes By Traditions second Reggie Award was also at Spirit of Brandtjen Farms in Lakeville for their model home at 5075 167th Street Lakeville, MN.   This home won the Reggie Award for the $575,000 – $749,999 class.

click on image to enlarge

The Trillium Winners for this home were Aspen Electric Inc., Glowing Hearth & Home, and JJ Vanderson & Co.

This home was a featured model in the Parade for being one of the first to earn the Minnesota Green Path Certification .  Another reason I believe Homes by Tradition is a market leader.

How does one win a Reggie Award?  It is quite simple, but not very easy.   To win a Trillium Award a Home Builder needs to stand out of the crowd in excellence.  This is done by superior design, attention to detail and value.  The Reggie Award winners are the home builders that are leading the trends and stand out from the rest.

What I think sets Homes By Tradition apart from the crowd is their ability to create warm feeling home designs reminiscent of the traditional homes we all know and love while incorporating all of today’s lifestyle needs and technology creating a New Traditional home.  They are able to implement this feeling effectively as they also design and create neighborhood communities with this same feeling of Home.

Spirit of Brandtjen Farms in Lakeville, MN is a perfect example of the community neighborhood they are able to create and design.  Spirit of Brandtjen Farms is in Rosemount-Apple Valley-Eagan School District #196.

 Check out Spirit of Brandtjen Farms website.

  

They offer these great neighborhoods throughout the Twin Cities ;  Hampton Hills in Plymouth, Dancing Waters in Woodbury, Heritage Landing in Prior Lake, Cobbelstone Lake in Prior Lake, Argenta Hills in Inver Grove Heights, and Territory in Credit River.

If you have not seen Homes By Tradition homes or neighborhoods, I encourage you to go check at their great designs and home at their models from 12:00 – 5:00 daily.

One of their new neighborhoods that I think is really exciting is Hampton Hills in Plymouth, MN.  They are currently under construction on a second model home, but you can still see their first model home.  I believe we might see the next Reggie Award come from this new neighborhood.   They have a great model there open daily from 12:00-5:00.

Congratulations to everyone at Homes By Tradition.  You earned these awards.

Homes By Tradition President, Dean Nelson Accepting both Reggie Awards

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Map: Where Minnesotans Are Moving to


Forbes has an online interactive map showing migration around the Country.  Below is an image I got when I clicked on Hennepin County, MN.  The red lines are showing people moving out of Hennepin County and black lines are showing people moving in.  About the data, they are saying their data comes from the IRS and is for the year 2008.  I know 2008 sounds like really old data, but if you remember the twin cities losing population post – that is when we saw the decline in population and the height of our unemployment in the Twin Cities.  Reversing these trends requires job growth in our region.  I would like to see more recent data also, but this is some really interesting information – click on the image to go to their interactive chart and click around the Country to see if you begin to see a pattern.

click on map to link to Forbes interactive map

 

 

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City of Bloomington lowers Tax Levy


Well this was certainly great news, especially for me since I own property in Bloomington.  The City has lowered their property tax levy for 2012, not by much but at least they are trying.  Given the changes in the Homestead Taxes, I don’t expect to see any actual reduction in the property taxes.  Funny how one takes this with relative nature, “at least it didn’t go up more..”

Bloomington reduced its total City levy despite state changes in Market Value Homestead Credit and relative values between residential and commercial properties. The City Council’s objective is to hold the median value home’s 2012 property taxes for City services at $67.82 per month, the same amount as in 2010 and 2011, with the average value home seeing a 1.45 percent decrease for 2012. See table below.

Property tax cost of services

Levy
amount

Change from
prior yr.

Median value home monthly cost of tax-supported services

Average value home monthly cost of tax-
supported services

2010

$44,606,281

+2.98%

$67.82

$78.01

2011

$44,582,753

-0.12%

$67.82

$79.73

2012
prelim.

$44,441,371

-0.25%

$67.82

$78.58

The property tax dollar levy for a median value and average value home is shown for the past three years. In 2011, the City Council approved a levy decrease. Over the past 20 years through 2011, the average levy increase was 3.24%. 2012 figures are preliminary. It can be reduced but not increased.

2012 median value home – $207,300; 2010 average value home: $235,500.

The City of Bloomington does a fairly good job on explaining why the taxes continue to increase even while our values are decreasing.  If you read this blog you will recognize the flow of this chart from another post of mine comparing the CPI with the FHFA Home Price Index.  The City property taxes seem to be pacing along the track of inflation, give or take.  Our home values are heading back down to keep more in line with the inflation.  Things are balancing back out naturally.

One of the great things about Bloomington is their fiscal responsibility, compared with other nearby Cities.  The only downside is we are still subject to Hennepin County tax levies and Schools district levies.  But for the Twin Cities area, Bloomington offers very nice affordable homes and a relatively low property tax rate.

If you are interested in further detail on The City of Bloomington’s property taxes, the City has published a very in-depth explanation you can read on their website.

If you are considering relocating, I highly recommend you look into Bloomington.  It is a great location within the Twin Cities at a great value.  Contact me if you would like further information about Bloomington Real Estate.

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NAHB: October 2011 Improving Market Index


The National Association of Home Builders released their Improving Market Index.  This index was started a couple of months ago by NAHB and First American.  This index hasn’t hit upon the Twin Cities area yet, primarily because we are not an improving market yet…  I do want to keep an eye on this because eventually we will be showing up on this index, hopefully.

Here is a pretty good video explaining the latest index results from NAHB.  NAHB: October 2011 Improving Market Index.

Basically, the improving markets are in Energy Producing areas (a.k.a. oil drilling).  So this is further evidence our biggest struggle is jobs, not inventory.

 

click to enlarge

 

October 6, 2011 – The second edition of the National Association of Home Builders/ First American Improving Markets Index (IMI), released today, shows 23 individual housing markets now qualifying as “improving” under the new gauge’s parameters. This is nearly double the 12 housing markets that made the list last month.

The index reveals metropolitan areas that have shown improvement for at least six months in housing permits, employment and housing prices. The following metros were listed in October:

  • Alexandria, LA
  • Amarillo, TX
  • Anchorage, AK
  • Bismarck, ND
  • Casper, WY
  • Fairbanks, AK
  • Fayetteville, NC
  • Houma, LA
  • Iowa City, IA
  • Jonesboro, AR
  • Kankakee, IL
  • McAllen, TX
  • Midland, TX
  • New Orleans, LA
  • Odessa, TX
  • Pine Bluff, AR
  • Pittsburgh, PA
  • Sherman, TX
  • Sumter, SC
  • Waco, TX
  • Waterloo, IA
  • Wichita Falls, TX
  • Winston-Salem, NC

“Both the number and geographic diversity of improving housing markets expanded this month, with Iowa, Illinois and South Carolina all newly represented by one entry or more on the list,” said National Association of Home Builders (NAHB) Chairman Bob Nielsen, a home builder from Reno, Nev. “This is further evidence that, despite the tough conditions that persist in many cities, pockets of improvement are emerging in local housing markets across the country.”

 

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RealtyTrac: Foreclosures on Slow Burn, August 2011


RealtyTrac released this news this evening.  There was no mention of Minnesota in the report, however we are still running middle of the pack in their foreclosure heat map.

The report talks about how foreclosure activity has been slowly declining but they are expecting it to pick back up as banks will want to move the next wave through the system.

“U.S. foreclosure activity has been mired down  since October of last year, when the robo-signing controversy sparked a flurry  of investigations into lender foreclosure procedures and paperwork,” said James  Saccacio, chief executive officer of RealtyTrac. “While foreclosure activity in  September and the third quarter continued to register well below levels from a  year ago, there is evidence that this temporary downward trend is about to  change direction, with foreclosure activity slowly beginning to ramp back up.

“Third quarter foreclosure activity increased  marginally from the previous quarter, breaking a trend of three consecutive  quarterly decreases that started in the fourth quarter of 2010,” Saccacio  continued. “This marginal increase in overall foreclosure activity was fueled  by a 14 percent jump in new default notices, indicating that lenders are  cautiously throwing more wood into the foreclosure fireplace after spending months  trying to clear the chimney of sloppily filed foreclosures.”

Read Full Report

RealtyTrac Foreclosure Heat Index Map

RealtyTrac Foreclosure Heat Index Map Minnesota

RealtyTrac Foreclosure Activity Counts

Hennepin County has 973 foreclosures according to RealtyTrac, they break that down further with the housing units to foreclosure ratio of 1 in every 520 housing units.  (quick math in my head 1 / 520 = .19% ?  is that right?  )I really wish we had a historical perspective on the foreclosure rate as a benchmark…

Still trying get a grasp on this phantom “Shadow Inventory” and what kind of numbers we are looking at for the Twin Cities…

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Weekly Twin Cities Real Estate Market Update. Week Ending Oct 1, 2011


Still heading the right direction!  The 30 year fixed rate mortgage dipped below 4% for the first time ever last week which should hopefully improve the market conditions.

For the Week Ending October 1st we saw a continued weaning of inventory with fewer year over year new listings and increased Pending sales.

New Listings  decreased 21.0% to 1,219

Pending Sales increased to 32.7% to 926

Inventory decreased 22.8% to 23,177

The inventory will continue to come down in it’s seasonal pattern, but year over year we are still down.  If you look at the chart below you can see that we are in the range of the 2005 inventory levels.

I am going to stick my neck out on this one and “Call it”.  We have just entered “Balanced Market” territory.  We have now dipped below 7 month supply which puts us on the upper edge of a Balanced Market.   As far as staying in this territory is whole other matter…

In a Balanced Market we should see sale prices holding closer to the asking prices giving us some price stability.  To see prices increase we are going to need demand to kick up a few notches to bring us into the Seller’s Market of 1-4 month supply.  But after the last few years, this is great news.

View Full Report from Minneapolis Area Association of Realtors

 

 




					

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Minneapolis/St Paul Residential Construction Employment


I was inspired to see what kind of data was available for the Twin Cities metropolitan area for the Construction Employment from a post on Calculated Risk.

The graph below shows the number of total construction payroll jobs in the U.S., including both residential and non-residential, since 1969.

Construction employment is down 2.175 million jobs from the peak in April 2006, but up 53 thousand this year through the September BLS report.

Unfortunately this graph is a combination of both residential and non-residential construction employment…

…Usually residential investment (and residential construction) lead the economy out of recession, and non-residential construction usually lags the economy. Because this graph is a blend, it masks the usual pickup in residential construction following previous recessions. Of course residential investment didn’t lead the economy this time because of the huge overhang of existing housing units.

Read Full Article

 

I decided to take a look at our Region’s Construction Employment.  Minnesota Department of Employment and Economic Growth, MN Deed, breaks it down to Residential Construction.  The data here only goes back to 2005, but it paints a pretty good picture of our situation.

We had a peak Residential Construction Employment of 12,409 jobs in the Twin Cities metro area in July 2006, we have continually lost Residential Construction Jobs since.  We are down 58% to 5,157 Residential Construction Jobs as of August 2011.  Keep in mind, the impact goes a LOT deeper into the economy than this figure.  Think about all the auxiliary business that is created with new housing; appliances, building materials, landscaping, financing, decorating, the list goes on and on.

I am having difficulty drawing the same conclusion as CalculatedRisk based on this information. From our Region’s perspective, we are still bouncing on the bottom with no major improvement in Residential Construction employment. The key difference is that we are comparing Residential Construction Employment to their “Construction Employment”.

If we look at the similar data they are using, we can see that in the Chart below.  This is the  seasonally adjusted construction Employment for Minnesota, includes greater Minnesota. The construction employment gains do not appear to be coming from the Residential sector at this time.

Are we at the bottom?  I believe we are, but I also believe we will be “Catfishing” or “bouncing” along the bottom for a while longer.

 

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Twin Cities Metro Area’s Pent Up Demand, Census Demographics projecting future housing demand.


After reading the National Association of Realtor’s article about the 15 to 19 age bracket and their housing needs, in my previous post.  It got me to think about our Region’s demographics and I was curious about some “ballpark” estimates on future housing demand in the Twin Cities area.

What kind of numbers are we talking about for the 15 to 19 age group and the 20 to 24 age group?  Here is the 2010 Census Chart on Age/Sex of the 7 County Twin Cities Region.

The 20 to 24 and the 25 to 29 age groups have been hit really hard by unemployment and have largely been left out of the housing market.  Let’s run some assumptions based on the 15 to 19 and 20 to 24 age groups.

Here are the numbers broken down for the age groups.

 


The 15 to 19 age group consists of 193,289 people in the 2010 Census for the Twin Cities Metro area.  We can’t assume that all of them will need housing; some will relocate out of State, some will get married, some will choose renting over owning and some will stay home with Mom and Dad.  So I am going to run with 50% of them will need housing,  it is just an arbitrary percentage I pulled out of thin air – maybe it is too high or too low but it is a nice round number.   So 50% of 193,280 of the 15 to 19 age group would be 96,644 housing units.  This will be over a period of let’s say 10 years for easy math and enough time for those age groups to enter the housing market, they would need  9,664 housing units per year.

If we look at the 20 to 24 age groups at 190,135 people, using the same 50% ratio we come up with 95,067.  Over the next 10 years would be 9,506 housing unit per year.

Looking at the 25 to 29 age group gets a little trickier to guess the numbers.  This is the age group that should begin to enter the housing market but with the economy many in this age group have been stuck.  If we were to run the same ratios we would come up with 110,383 housing units and over 10 years would be 11,038 per year.  I don’t really like those ratios on this age group, because some have entered the housing market by taking advantage of the First Time Homebuyer Tax Credit.  So for these purposes I am going to leave them out of this projection even though there is a fairly large number here that will enter the housing market.

So just looking at people age 15 to 24 we have a grand total of 191,712 housing units or 19,171 housing units a year.  Considering we have approx 24,000 housing units for sale, this could put a lot of pressure on the supply / demand ratio.   Remember, we have already accounted for the marriages and moving out the region in these figures. We haven’t taken into account the deaths and migration in this ballpark estimate, so it is not a figure I would use to do any serious forecasting with.

This estimate does however show us the “Pent Up Demand” that needs to be un-lodged , the only way to un-lodge this pent-up demand is to get these age groups Jobs.

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Greater MSP organization, bringing economic growth to the Twin Cities region


Apparently we are not the first to realize that our region’s employment situation has been grim and the repercussions of losing jobs can be devastating including population decline.

There is an organization that has been created to try to promote and bring employers to the Twin Cities metro area.  It is called Greater MSP.  

My first reaction to this was “oh no, not another ‘do nothing’ organization siphoning tax dollars”.  As I read further into it, this may hold some merit.  They have managed to pull together a pretty impressive board of directors to manage the organization; at least their credentials are a lot better than mine.  There are a number of  business leaders on this board that should know what is needed and how to achieve it.  The organizations visions and goals line up with what I believe our region needs to focus on:

Vision for a Brighter Future for All

The GREATER MSP Partnership is committed to stimulating economic growth and prosperity in the Minnesota’s 13-county Minneapolis Saint Paul metro area. As a public-private partnership funded by charitable donations, its vision is to be a value-added resource to all economic development organizations in the Greater MSP region. Its goal: a brighter future for all Twin Cities residents and businesses.

Strategic Direction

The Partnership works with dozens of economic development partners at the state and regional levels. It provides vision, strategy, resources and staff support to governments and organizations involved with job creation, regional marketing, business recruitment and business retention. Specifically, the GREATER MSP Partnership leads or partners with existing organizations to:

  • Set a strategic vision for regional economic development
  • Define and guide a tactical economic development agenda
  • Brand and market the Greater MSP region to internal and external audiences
  • Retain and expand current businesses in the region
  • Attract new businesses to the region
  • Connect businesses with local resources and incentives

 

I heard about this organization from Minneapolis St Paul Business Journal that wrote a short article about the new organization and their kick-off event coming up.

The organization will be holding a big kick-off event Tuesday evening at the Pantages Theater in downtown Minneapolis where invited guests and media will learn more about the region’s new “brand and marketing campaign” and hear about how Greater MSP will help recruit companies to the region.

Read Full Article

Let’s hope their efforts produce results, our region needs economic growth.  Take a moment to visit their website and let’s support their efforts any way we can.  They are running all this  from Charitable Donations according to their website.

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2nd Quarter Mortgage Delinquency rates for Minnesota, our Shadow Inventory


Believe it or not I have been struggling to find good data to show what kind of potential Shadow Inventory we may be seeing down the road for Minnesota, and more specifically the Twin Cities metro region.  The Shadow Inventory is theoretical in nature and estimates vary greatly, so trustworthy sources are important as well.

I was able to find some information from the Minneapolis Federal Reserve for the 2nd Quarter of 2011.  I would imagine the 3rd Quarter should be coming out sometime soon and I will keep on a lookout for that report.

In the meantime, I will share some of the information in this 2nd Quarter 2011 report on Minnesota.  The report was sort of lacking on details for the Twin Cities region, but it is a start…   I am in search of actual numbers of homes or mortgages, so if you happen to know where those can be found please let me know.

The highest levels of foreclosures are just north of the Twin Cities in Isanti and Mille Lacs Counties.

 

Below breaks it down by Zip code, which is little more helpful.  Hennepin County seems to have the highest concentration in the northeast corner of the County.  What I am really interested in,  getting my hands are the raw numbers of mortgages by Zip Code…  Haven’t found them yet, but this is at least getting closer.

This chart is a little more telling on the what we might expect in the way of Shadow Inventory for all of Minnesota.  It appears to be coming down substantially from last year, but still a fairly large wave.   Judging by the national reports, this has probably come down even further in the 3rd quarter.

 Several questions remain:  How many of  these delinquencies will end up in foreclosure? Are they are already for sale on the MLS and already factored into our supply?   And, Will this wave continue to shrink?

I guess like any good research, it leaves us with more questions than we started with….

click to view full report

 

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