Thursday, July 20th, 2017
By Erin Milburn on Tuesday, July 18th, 2017

Despite the decelerating gains in buyer activity, June 2017 was a new record high for home sales in the Twin Cities. Compared to last June, closed sales in the metro rose 2.2 percent to reach a new high of 7,430 units. Meanwhile, pending sales only showed a 0.2 percent gain and new listings fell 0.5 percent. Persistently low inventory levels are keeping some would-be buyers out of the market. The number of homes for sale fell 16.5 percent to 12,464 active listings in the metro. Declining foreclosure and short sale activity can contribute to market-wide declines. For example, within the traditional segment, new listings rose 1.6 percent and pending sales rose 2.4 percent.

Prices are still marching higher. In fact, the median sales price rose 7.0 percent from last year to $259,000—a new record high. Home prices have now risen for the last 64 consecutive months. At 47 days on average, homes went under contract 16.1 percent faster than last June. However, half the homes that went under contract in June took less than 20 days to do so. The average percent of original list price received at sale was 99.5 percent, 0.8 percent higher than June 2016. Similarly, the median percent of original list price received at sale was 100.0 percent, meaning half the sales closed for over list price. The metro area has a sparse 2.5 months of housing supply—the lowest June reading since 2003. Generally, five to six months of supply is considered a balanced market where neither side has a clear advantage.

“The numbers confirm what agents already know about this market,” said Cotty Lowry, Minneapolis Area Association of REALTORS® (MAAR) President, “We are still very thirsty for listings. That means sellers who list well-presented, well-priced homes are being rewarded, and they’re finding the move-up market to be less competitive.”
June-2017-Chart-702x494
A thriving and diverse local economy has been conducive to housing recovery, as job growth is key to new household formations. The most recent national unemployment rate is 4.4 percent, though it’s 3.7 percent locally. The Minneapolis–St. Paul region has a resilient economy with a global reach, a talented workforce, top notch schools and a quality of life that’s enabled one of the highest homeownership rates in the country.

The average 30-year fixed mortgage rate has declined from 4.3 percent to 4.0 percent recently, still well below its long-term average of about 8.0 percent. Excluding any surprising data or events, the Federal Reserve is likely to increase their target federal funds rate at least once more this year. Wage and inventory growth are key to offsetting affordability declines brought on by higher rates and rising prices.

“Although supply is tight, attractive and competitively-priced homes remain in high demand,” said Kath Hammerseng, MAAR President-Elect. “But even as construction activity recovers somewhat, wage and housing supply growth remain key to balancing out affordability concerns.”
From The Skinny Blog.

Posted in The Skinny |
Monday, July 17th, 2017

For Week Ending July 8, 2017

From a heart-of-summer perspective, the residential real estate market has performed as expected when predictions were made at the front of the year. Buyer interest is high and inventory is not at a proper level to meet demand. Total sales and new listings are generally behind last year’s levels from week to week, but there is evidence of improvement in both metrics.

In the Twin Cities region, for the week ending July 8:

  • New Listings decreased 16.9% to 1,371
  • Pending Sales decreased 4.7% to 1,061
  • Inventory decreased 16.7% to 12,351

For the month of June:

  • Median Sales Price increased 7.0% to $259,000
  • Days on Market decreased 16.1% to 47
  • Percent of Original List Price Received increased 0.8% to 99.5%
  • Months Supply of Inventory decreased 16.7% to 2.5

All comparisons are to 2016

Click here for the full Weekly Market Activity Report. From The Skinny Blog.

Posted in Weekly Report |
Monday, July 10th, 2017

For Week Ending July 1, 2017

Nationally and locally, economic conditions affecting residential real estate have not changed much this year, which is good for market stability. The most recent jobs report was favorable, while unemployment and mortgage rates both remain satisfyingly reasonable. If there were more homes for sale, we might see a shift in prices. Although builder and seller confidence are high, we are not close to a trend change in that regard.

In the Twin Cities region, for the week ending July 1:

  • New Listings decreased 0.1% to 1,587
  • Pending Sales decreased 5.6% to 1,377
  • Inventory decreased 16.5% to 12,628

For the month of May:

  • Median Sales Price increased 5.5% to $250,000
  • Days on Market decreased 15.0% to 51
  • Percent of Original List Price Received increased 0.9% to 99.5%
  • Months Supply of Inventory decreased 17.2% to 2.4

All comparisons are to 2016

Click here for the full Weekly Market Activity Report. From The Skinny Blog.

Posted in Weekly Report |
Monday, July 3rd, 2017

For Week Ending June 24, 2017

We are now beyond two years of year-over-year declines in inventory, and it doesn’t look like the situation is going to change anytime soon. However, buyer demand and home prices are still rising, and the number of distressed homes on the market has fallen. It would be great to see more starter homes on the docket for new construction during these next few busy building months to help those that are looking to enter the market.

In the Twin Cities region, for the week ending June 24:

  • New Listings increased 1.2% to 1,928
  • Pending Sales decreased 1.1% to 1,405
  • Inventory decreased 16.3% to 12,481

For the month of May:

  • Median Sales Price increased 5.5% to $250,000
  • Days on Market decreased 15.0% to 51
  • Percent of Original List Price Received increased 0.9% to 99.5%
  • Months Supply of Inventory decreased 17.2% to 2.4

All comparisons are to 2016

Click here for the full Weekly Market Activity Report. From The Skinny Blog.

Posted in Weekly Report |
Monday, June 26th, 2017

For Week Ending June 17, 2017

As Millennials get older and more established in their careers, more of them are
entering the housing market. Nationwide sales rose to the third-highest level since
the housing crisis a decade ago, while home prices also hit record highs. Although
increasing prices may push some out of the running for a home purchase, mortgage
rates remain low enough to lure potential buyers.

In the Twin Cities region, for the week ending June 17:

  • New Listings decreased 6.6% to 1,840
  • Pending Sales decreased 4.8% to 1,396
  • Inventory decreased 16.2% to 12,316

For the month of May:

  • Median Sales Price increased 5.5% to $250,000
  • Days on Market decreased 15.0% to 51
  • Percent of Original List Price Received increased 0.9% to 99.5%
  • Months Supply of Inventory decreased 17.2% to 2.4

All comparisons are to 2016

Click here for the full Weekly Market Activity Report. From The Skinny Blog.

Posted in Weekly Report |

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