Minneapolis Real Estate Blog

Minneapolis and St. Paul real estate maintained their market value pretty well during the recent downturn because of the strength of the Minnesota economy. Now with the recent 1% reduction in the Fed Funds Rate, real estate in the Twin Cities is poised to make a complete recovery.

Single family foreclosure rates are up in the Twin Cities, but that is to be expected after the excesses of the Subprime lending boom. To quote Alan Greenspan, “irrational exhuberance” can’t last for ever. So now we are left with financially healthy buyers and sellers in a more rationalized market where values are more closely to tied to actual attributes of the underlying asset, rather than prices being artificially inflated by an unsustainable increase in demand.

Ultimately Minneapolis real estate benefits from this pruning of excess demand, because rationalized asset values benefit long term investors and traditional home owners and penalize flippers and others looking to make a quick buck in real estate.