Are Foreclosures Making a Comeback in the Twin Cities?

If you’ve been scrolling through headlines or catching bits of conversation about foreclosures and short sales roaring back, it’s easy to feel a little uneasy about where the housing market is headed. The word “foreclosure” carries a lot of weight, especially for anyone who remembers what the last major downturn did to homeowners. So let me set the rumors aside and walk you through what the actual numbers show here in the Twin Cities.

April’s listing numbers tell the real story. In April, the Twin Cities had more than 7,400 new listings hit the market. Out of that entire pool of homes, only 26 were short sales, and just 56 were lender-owned foreclosures. Put those together, and distressed properties made up less than 1% of everything for sale across the metro, which is far less a wave than a rounding error in a market this size.

One scary-sounding stat, in context. Here’s the part that tends to grab attention. Short sale listings were actually up 53% compared to last year, and on its own, a jump like that sounds like the start of something bigger. But then you remember what that percentage is measuring. We’re talking about 26 homes across the entire Twin Cities metro. When the starting number is that small, even a modest increase looks dramatic in percentage terms. The raw count is what tells the truth, and the raw count is tiny.

Why today looks nothing like 2008. I have been selling real estate through multiple market cycles, including the housing crash, and what we’re seeing today does not resemble that period in any meaningful way. Back then, distressed properties made up a staggering share of the market, whereas today they are a fraction of a fraction of everything for sale. The conditions that fueled the last crash simply aren’t present now.

Most homeowners are sitting on real equity. The other reason this market holds steady is that the vast majority of Twin Cities homeowners still have a significant amount of equity in their homes. That equity is a cushion. It’s what keeps people from being forced into a distressed sale when life throws them a curveball, and it’s a big part of why distressed listings remain such a small slice of the overall market. If you’ve owned for a while, there’s a good chance you’re in a stronger position than the rumors would have you believe.

So if you’ve been worried about your home’s value or wondering what your options are, the best thing you can do is get real numbers rather than react to headlines. Whether you’re simply curious where you stand or thinking through a possible move, I’m glad to walk you through what’s actually happening in your specific situation and neighborhood. Call or text me at 952-222-9000, email me at john@johnschustergroup.com, or visit johnschustergroup.com, and I will help you get a clear read on your home and your options. I look forward to hearing from you.