Minneapolis was actually highlighted in their press release (but not in the data they've released for free, sorry):
A protracted recovery in home prices is also expected in many urban neighborhoods where predatory lending was most rampant. There, home prices rose rapidly from very low levels during the bubble years. These markets include neighborhoods in cities such as Minneapolis, Memphis and Chicago. [Emphasis ours]Here's the 'heat map' for housing-price recoveries according to Fiserv:
(Click To Enlarge)
BTW, that's a lot of RED in California, Arizona and Florida!
One bright spot, though, is that according to the same map, Duluth and parts of the Arrowhead should see prices back revert back to their peak prices in just a couple of years.
Fiserv came to its conclusions using the data collected from the Case-Shiller home price indexes and data from the Federal Housing Finance Agency and Moody’s Economy.com, and the Center makes no representations or warranties of any kind, express or implied, as to the accuracy of the data or projections. :-)
Now, what does this mean for the Center and our work?
For homebuyers:
- The idea of earning quick equity and/or using your home as short-term road to wealth should NEVER be a deciding factor in purchasing your first home;
- Purchasing a home is a LONG-TERM decision... you may not be able to sell the home you purchase today FOR YEARS without incurring expenses;
- Home ownership is expensive and homeowners need to understand the costs as well as the benefits of owning;
- Pre-purchase education and counseling are keys to understanding REAL wealth generation and long-term successful homeownership. Click here for more info on the Home Stretch program.
For current homeowners (and the foreclosure issue):
- Without price appreciation on the horizon for a number of years, struggling homeowners will be unable to access equity, or sell without incurring losses, for quite some time.
- More homeowners may decide to 'strategically default' that may lower prices even further, which in turn will further depress home prices in hard-hit areas.
ALSO... we couldn't post about foreclosure issues without warning Minnesota Home Owners, AGAIN, to make sure that they NEVER pay for any third-party loan modification service. Deal directly with your lender yourself, or with one of our free, non-profit Foreclosure Counselors.
Any thoughts? Feel fee to share your opinions in the comments.
Well a prediction that Twin Cities prices will return to bubble levels in 5 - 15 years doesn't seem like much of a stretch to me. I agree that areas hardest hit in the foreclosure department will be the ones that will take the longest to recover, though since they also fell the furthest, it all makes sense.
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