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Milennials and the American Dream

HappyFamily_BuyingA few years ago, many people believed that Millennials (ages 18-29) would be “a generation of renters” – – that the economy and changing lifestyle choices would somehow mean that this generation would be the first generation in American history without the desire to own a place of their own.

While the most recent mortgage crisis has taken some of the shine off of the concept of owning,… and an important component of their future success.

Of those surveyed:

» 75% believe homeownership is an important long-term goal
» 73% believe homeownership is an excellent investment
» 24% already own their home and
» An additional 60% plan to buy a home in the future

 
 
Importantly, this next generation of buyers understands that buying a home can be complex and are more cautious. The Demand Institute report finds that 44% of Millennials think it would be difficult to qualify for a mortgage.

We have to work together to make sure that this next generation of buyers are fully informed and are making smart choices when entering into homeownership.

We know that homebuyer education and counseling services are a significant deterrent to default and foreclosure. Do you know a Millennial that is thinking about homeownership? Make sure that they are armed with the necessary knowledge to be successful. Make sure that they attend a Home Stretch Workshop or take the online Framework course.
  
We can build vibrant communities across Minnesota… if we work together to help the next generation of buyers make thoughtful and informed purchases.

Posted on: Thursday, October 2nd, 2014

Additional research supports ‘State of Homeownership’ in Minnesota

UnevenRecoveryIn June, the Center released our “State of Homeownership” report, sharing information on the importance of homeownership, the latest data on the uneven housing recovery and expressing our hopes for smart, sustainable homeownership in Minnesota.

Recent research from the geography program at Macalester College shares similar findings on the aftermath of the crisis, showing an unequal recovery among neighborhoods hit hardest by foreclosure.

The project, “A Dream Foreclosed: The Uneven Geography of the Foreclosure Crisis in the Twin Cities,” by student Zach Avre, looks at the Twin Cities housing market leading up to the mortgage crisis and the impact of the resulting rise in foreclosures, particularly on historically marginalized communities.

Avre’s research found “Communities with high concentrations of people of color and low-income residents witnessed the greatest levels of housing value appreciation leading up to the housing crash. However, low-income communities of color and renters across the metro region experienced disproportionately higher rates of foreclosure and housing value depreciation than more affluent, white homeowners in the aftermath of the crash.”

Even today, the Center writes in its report, “Foreclosures continue to weigh heavily on the neighborhoods predominantly of color like Near North and Phillips in Minneapolis, and the Payne-Phalen and Thomas-Dale in St. Paul. In each of these neighborhoods, nearly half of all homes sold in 2013 had been foreclosed upon. Median home sale prices are also low – as low as $81,000 in Near North. Home values have improved in recent years, but 2013 sales prices must still increase by anywhere from 74 percent (Payne-Phalen) to 110 percent (Phillips) to reach peak home values recorded in 2006.”

In conducting his case studies of these areas, Avre uses urban housing submarket theory – in short, the idea that home values tend to appreciate most quickly at the edges of suburban development, and most slowly in the city core. “Yet,” he writes, “not only did a housing bubble develop within North Minneapolis before 2006, but the tracts in the central city also witnessed the most substantial declines in home values following the crash.”

Delinquency rates – a sign of foreclosures to come – are also high in predominately minority and low-income neighborhoods, ranging from 5 to 8 percent of all mortgaged homes. Affluent, mostly white neighborhoods reviewed are seeing the opposite trend. In Southwest Minneapolis, average home sale prices reached $306,000 and distressed homes made up only 9 percent of sales in 2013. There, just 8 percent of homes are underwater and home values have exceeded 2006 peak prices.

TodaysBuyersAreCautiousThough Avre states homeownership has traditionally been a goal in the working class and lower middle class submarkets, today’s homebuyers of all incomes are more cautious. In fact, more than 3 in 4 Americans believe the housing crisis isn’t over, according to a 2013 survey sponsored by the MacArthur Foundation.

This caution is playing out in Minnesota, where more first-time homebuyers are taking steps to make thoughtful and informed purchases. Overall, homebuyer education is expected to play a greater role in the home buying process in the years to come as lenders, consumer advocates and local governments recognize that education is a significant deterrent to foreclosure. One 2013 analysis by Freddie Mac even found mortgage delinquency dropped by nearly one-third when first-time homebuyers participated in education or counseling.

If you are purchasing your first home – or working with clients that are in the buying process – make sure you avail yourself of one of the best deterrents to future foreclosure… additional information about homebuyer education in Minnesota is available, here.

Posted on: Monday, August 25th, 2014

No News is Good News For Pre-Foreclosure Notices

ScreenCap_InfoGraphicSimply put, there’s nothing newsworthy about the number of pre-foreclosure notices issued in the first quarter of 2014 to Minnesota homeowners… and that’s a very good thing!  The number of pre-foreclosure notices came in well within expectations and continued in line with the downward trend we have seen since Q3, 2010.

In the first quarter of 2014, Minnesota homeowners received only 5,528 notices, a healthy 41% drop from the number of notices issued in the same quarter of 2013: 5,528 vs. 9,291.  The Twin Cities Metro received 56% of the notices issued (3,070) and Greater Minnesota received 44% (2,458).

As always, we use the word ‘only’ cautiously when discussing foreclosures, as it still means that more than 5,500 households are not only struggling with their mortgage, but have fallen far enough behind for their lender or lien holder to begin the foreclosure process.

The Center has put together another infographic to help visualize the data surrounding pre-foreclosure notices:

PreforeclosureNotice_Graphic_Q1_2014

(Click to Enlarge)

If you, or someone you know, is struggling with to keep up with their mortgage payments, or is worried about a FUTURE payment… don’t delay, contact a Homeownership Advisor that specializes in foreclosure today!  To learn more, or to contact your local organization, click here.

Posted on: Tuesday, April 15th, 2014

Homebuyer Programs Break Records

6,424 Minnesota Households Take Homebuyer Education

The Minnesota Homeownership Center has released its 2013 Homebuyer Services Report and it shows more good news for Minnesota’s housing market. More Minnesota households took advantage of Home Stretch and Framework in 2013 than ever before. 

January2014_StatesImageThe number of households completing education increased seven percent over 2012 and the number of households seeking one-on-one housing counseling increased by a dramatic 20% to more than 2,500 households.

This is good news for Minnesota’s housing market as we know educating and empowering buyers BEFORE they make one of the largest investments in their lives is one of the best ways to prevent a future recurrence of the most recent housing crisis.

The report, 2013 Homebuyer Services Report, includes demographic and other data for the participants in the programs supported by the Minnesota Homeownership Center during the program year October 1, 2012, through September 30, 2013.

To view a full copy of the report, click here.

Posted on: Thursday, February 20th, 2014

Minnesota Foreclosure Activity Continues to Plummet

Sheriff’s Sales drop to less than 7,000 in the first half of 2013

Click to Enlarge

From the Minnesota Homeownership Center’s most recent press release:  — During the first half of 2013 the number of completed Sheriff’s Sales, the final step of the foreclosure process in Minnesota, has fallen to the lowest level since the beginning of the housing crisis.  Statewide, there were 6,795 foreclosures in the first two quarters of 2013. This number is 29 percent less than the same period of 2012, with a greater decline seen in the Twin Cities metro area (down 33 percent) than in Greater MN (down 23 percent).

The “2013 Semi-Annual Foreclosures in Minnesota” report was released Thursday by the Minnesota Homeownership Center using research provided by HousingLink and adds to other recent evidence showing that fewer Minnesota homeowners are struggling with mortgage payments than at any time since 2006. 

While more than 1,100 homes each month were lost to foreclosure in the first half of the year, this number pales in comparison to 2010, when Minnesota was experiencing the worst of the housing collapse.  During the first half of 2010, lenders were auctioning off more than 2,100 homes each month.

“Modest improvements in Minnesota’s economy and increasing home prices, combined with improvements in how banks and lenders deal with struggling homeowners are positively impacting the number of homes lost to foreclosure,” stated Ed Nelson, Marketing and Communications Manager for the Minnesota Homeownership Center. “However, while the most recent data is encouraging, we can’t lose sight of the fact homes are still being lost to foreclosure at rates that exceed twice those of historic levels.”

Homeowners that are struggling to make mortgage payments are encouraged to seek help from a certified foreclosure prevention specialist that is a member of the Homeownership Advisors Network as soon as possible.  Waiting limits a homeowner’s option.   To find a free local foreclosure specialist, click here, or call the Minnesota Homeownership Center at 866-462-6466.   

Posted on: Thursday, August 15th, 2013