Understanding the Fergus Falls Real Estate market: a Seller's Perspective

It is only fair that I provide equal time and guidance for property sellers in today's real estate market. My last post related to buyer opportunities. This time we will focus on opportunities available to sellers.

To put it another way, let's leverage our strengths as sellers to kick the 'Hee Haw' out of the market seesaw. Seller's need to flex their property attributes to balance the seesaw market. Instead of having prospective buyers 'holding sellers up', let's look at what sellers can do to restore a balanced and level playing field.

But before I speak on specific strategies for sellers, we need to be certain we understand our local market and debunk some myths - a.k.a. 'obviate the rubric'.

We have all heard the latest national real estate news. It reminds me of that refrain from the late '60's 'Hee Haw' show with Roy Clark and Buck Owens: 'Gloom, despair, and agony on me.' National housing market news trends often focus on worse-case scenarios, and averages at best. Here is what we need to keep in mind: Local economies and markets may bear no similarity to national trends. In fact, the local market might be far healthier. What sellers need to overcome is the national media mindset that has been embraced by prospective buyers.

For the remainder of this post I am going to highlight some statistics specific to the Fergus Falls market. I believe this information will clearly show our local market is making improvements in key areas and, more importantly, potential sellers need not hang their heads as though they were on their way to the gallows.

This first graph shows a geographical comparison of foreclosure rates as of December 2011. The graph displays, a national rate, a rate for the state of Minnesota, an Otter Tail County Rate, and the rate for Fergus Falls. Please note the marked difference in rates from the National level to those of Otter Tail County and Fergus Falls. (Be sure to see more foreclosure information at my RealtyTrac page.

This second chart shows foreclosure activity and average mortgage rates for Fergus Falls as of December 2011. I'm hoping this information is alleviating some seller heartburn! As we Minnesotan's are prone to say, 'Things could be worse.' Again, this information is provided by RealtyTrac. More RealtyTrac information can be viewed at my RealtyTrac page.

Just a couple more numbers and I'm going to wrap this up. According to our local MLS data, 134 Fergus Falls homes were sold in the last six months of 2011. This compares to only 102 in the same period of 2010 reflecting a gain in unit sales of 31%! Wow!! Here is one catch: the average selling price dropped in 2011 compared to the same period for 2010. Bummer. But all is not lost! What this means is, although sale units were UP, the average selling price of the sold properties dropped. What we observed in this time frame is the bulk of homes sold were in the $60,000 to $115,000 price range.

I'll conclude this discussion for now to allow a little time to digest this information. Be sure to check out my next blog post: What can a seller do to maximize their return if there property is valued above the average range of sold properties? Stay tuned . . .

Jon Drews, Associate Broker with Century 21 Vista, Inc. in Fergus Falls MN.