Detroit Lakes real estate market not suffering like other areas
The real estate market in Detroit Lakes hasn't plunged as it has in other parts of the country.
While the total number of sales and the average sale price are down, the Lakes Country Association of Realtors said that the local real estate market is holding up well.
According to data provided by the LCAR, the number of sales decreased by 9.4 percent in 2008 compared to 2007 figures.
One bright spot emerged in the numbers. Sales of homes in Detroit Lakes rose in 2008 from the previous year - 158 this year from 136 in 2007.
Some of that is being attributed to high gas prices that are encouraging homebuyers to stick close to work and shopping.
Rural home sales fell slightly in 2008 to 73 sales from 78 homes sold in 2007.
The average price per sale of homes in Detroit Lakes fell from $186,100 to $176,731.
With commercial property, sales fell almost in half in 2008. Only 12 commercial properties were sold last year, compared to 23 in 2007. However, the total value of those commercial sales increased despite the low number of sales.
The total value of commercial sales rose to $3.3 million in 2008 from $2.7 million the year before.
Lakeshore land sales also took a big hit as 28 lakeshore lots were sold in 2008. The previous year saw 39 lakeshore lots being sold.
Most of the lot sales in 2008 were on smaller lakes or those with common beaches, the LCAR report stated.
However, lakeshore home sales didn't slow down as much -- 99 homes sold in 2008, with 108 being sold the year before.
The total value of lakeshore home sales actually increased despite the lower number of sales. In 2008, the total value of lakeshore homes rose to $40 million from $35.2 million in 2007. The LCAR said that increase was due to several high value lake homes being sold.
Those high value sales pushed the average sale price to $405,000 from $326,000 in 2007.
Overall lot sales decreased somewhat in 2008 as well. Factoring in lot sizes, those that are 10 acres or less fell from 26 sales in 2007 to 21 sales in 2008.
The number of lots larger than 10 acres also fell to nine sales in 2008 from 13 sales the previous year.
City lot sales stayed even at 14 sales in 2007 and 2008.
The LCAR is bullish on prospects for 2009.
One reason the organization believes that to be the case is that buyers have plenty of selection and that prices have come down to reasonable levels.
Also in buyers' favor this year is low interest rates.
Mortgage provider Freddie Mac said that the average rate for a 30-year fixed rate mortgage fell to 5.01 percent. It's the 10th straight week that rates have fallen and the fourth straight week a record low has been set.
Because rates are lower, the LCAR is stating that homebuyers can get into a better home for the same monthly payment they are paying now.