Twin Cities home market improving or still declining?

We’ve seen signs the past couple months the Twin Cities housing market is starting to drag itself back to its feet. But new data released today from the respected S&P/Case-Shiller Home Price Indices suggests it’s no time for high-fives. Home values here are still on the slide.

The Cities showed a record monthly decline of 6.1% in March — the largest monthly drop of any metro area in the history of the indices. The index is down nearly 25 percent from a year ago.

Looking at the 20 U.S. cities it charts, S&P concludes there’s no evidence yet that a recovery in home prices has begun.

So what’s happening?

We’ve seen a generally upbeat outlook from local Realtors that home sales are bouncing back thanks to the $8,000 first time homebuyer tax credit.

It’s possible prices are bottoming out and it just hasn’t showed up yet in the numbers. There’s been a lot of “lender mediated” housing sold in the Twin Cities, driving down over all market values. That inventory is falling now. As supply and demand find a balance again, that’ll be good news for prices.

But as my colleague Mike Caputo pointed out recently, we’re also in a one-and-done market right now — there’s high demand for houses below $200,000, so the first-time homeowner market is solid. Current homeowners, however, are not interested in selling and buying something more expensive.

Bottom line: We’re seeing a lot of activity in selected parts of the Twin Cities housing market. But that’s not going to translate into a recovery in median home prices any time soon.

Below are stories people in our Public Insight Network are telling us about the housing market where they live. Check it out then add a story we can map.

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