• The median sales price was up 0.5 percent from last June to $382,000
• Signed purchase agreements fell 10.8 percent; new listings down 16.5 percent
• Sellers accepted offers for an average of 101.3 percent of their list price

(July 16, 2023) – According to new data from Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, home prices rose slightly in June. Both buyer and seller activity were also lower compared to last June.

Sales & Prices

Prices were down slightly in April and May but up 0.5 percent in June. April marked the first year-over-year price decline since February 2012. Half of all homes sold for over $382,000. But as in April and May, sellers in June still accepted offers above list price despite a decline in sales—a dynamic that reflects the lack of supply despite rising mortgage rates. Sellers received offers at 101.3 percent of their asking price. Market times—while up—still reflect a relatively fast-paced market. Half the sales went under contract in under 12 days. And homes are still selling faster than in June 2018, 2019 and 2020.

“Some remain convinced of an impending crash, but we’re still not seeing it,” said Brianne Lawrence, President of the Saint Paul Area Association of REALTORS®. “Two months of prices softening around 1.0 percent before climbing again is more like a blip or pause than a downturn.” But the Fed-driven decline in demand persists. As we compare to slower months of 2022, the sales declines have moderated. Pending sales dipped 10.8 percent; closed sales fell 18.0 percent.

Listings and Inventory

June sellers brought 16.5 percent fewer new listings to market than last year. Inventory levels slid 9.0 percent lower. Some sellers are choosing to stay put and wait instead of selling for a lower price. Most sellers are also buyers and are reluctant to trade away their 3.0 percent interest rate for 6.8 percent. “Even with fewer sales in light of higher rates, homes are still selling relatively quickly while sellers get relatively strong offers,” said Jerry Moscowitz, President of Minneapolis Area REALTORS®. “That’s partly driven by homeowners with rates under 4.0 percent staying put.”

Both supply and demand have come down in tandem, meaning the balance between buyer and seller activity has remained tight. Inventory levels fell 13.4 percent in June to 7,492 active listings. The market still favors sellers, but not to the same degree as the last few years. Our 2.0 months supply of inventory was up 17.6 percent. Typically 4-6 months of supply are needed to achieve a balanced market.

Location & Property Type

Market activity varies by area, price point and property type. New home sales rose 24.3 percent while existing home sales were down 12.8 percent. Single family sales fell 13.7 percent, condo sales declined 3.2 percent and townhome sales were up 0.8 percent. Sales in Minneapolis decreased 12.1 percent while Saint Paul sales fell 12.9 percent. Cities such as Annandale, Shorewood, White Bear Township and Delano saw the largest sales gains while White Bear Lake, New Hope, New Prague, Zimmerman and Hudson all had notably lower demand than last year.

June 2023 Housing Takeaways (compared to a year ago)

• Sellers listed 6,664 properties on the market, a 16.5 percent decrease from last June
• Buyers signed 4,997 purchase agreements, down 10.8 percent (5,343 closed sales, down 18.0 percent)
• Inventory levels shrank 13.4 percent to 7,492 units
• Month’s Supply of Inventory rose 17.6 percent to 2.0 months (4-6 months is balanced)
• The Median Sales Price rose 0.5 percent to $382,000
• Days on Market rose 47.6 percent to 31 days, on average (median of 12 days, up 50.0 percent)
• Changes in Sales activity varied by market segment
  • Single family sales decreased 13.7 percent; Condo sales were down 3.2 percent & townhouse sales rose 0.8 percent
  • Traditional sales declined 11.0 percent; foreclosure sales rose 76.0 percent (44); short sales decreased 33.3 percent (4)
  • Previously owned sales were down 12.8 percent; new construction sales rose 24.3 percent
  • Sales under $500,000 fell 12.9 percent; sales over $500,000 declined 0.4 percent

From The Skinny Blog.

• The median sales price was down 1.3 percent from last May to $370,000
• Signed purchase agreements fell 19.3 percent; new listings down 17.6 percent
• Sellers accepted offers for an average of 101.1 percent of their list price

(June 15, 2023) – According to new data from Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, home prices dipped slightly from last May. Both buyer and seller activity were also lower compared to last year.

Sales & Prices

Prices were flat in April and down slightly in May. As in April, May sellers still accepted offers above their list price despite a decline in sales—a dynamic that reflects the persistently tight balance between supply and demand even in light of rising mortgage rates. While some sellers are still seeing multiple offers on well-presented listings, the offers were closer to 1.0 percent over list price versus 4.0 percent over list price last May. With half the homes selling in under 13 days, market times are up as demand has waned. And yet, homes are still selling faster than in May of 2019 and 2020.

Pending sales dipped 19.3 percent; closed sales fell 28.1 percent. Condo sales showed the largest drop while townhomes saw the smallest decline. Single family homes sold at a median of $405,000, townhomes at $311,000 and condos at $205,000. New home sales were flat while existing home sales were down. New homes sold for $461,000 while existing homes sold for $355,000. Sales under $500,000 decreased 20.4 percent while sales over $1M fell just 6.6 percent.

Home prices are up 25.5 percent since May 2020, but down 1.3 percent from May 2022. “It’s important to keep things in perspective,” said Jerry Moscowitz, President of Minneapolis Area REALTORS®. “The median price simply reflects the middle or typical home selling, but every home is unique. In some ways, this pause gives buyers some room to be more selective on the listings that really stand out.”

Listings and Inventory

In May, sellers brought 17.6 percent fewer new listings online than last year—the smallest decline in four months. Inventory levels slid 9.0 percent lower. Some sellers are choosing to stay put and wait instead of selling for a lower price. Most sellers are also buyers and are reluctant to trade away their 3.0 percent interest rate for 6.8 percent. “While rates are surely a factor in decision-making, don’t lose sight of other factors like changes in lifestyle, a new job, growing or shrinking households, separations and so on,” said Brianne Lawrence, President of the Saint Paul Area Association of REALTORS®. “Economists’ interest rate forecasts vary widely; nobody knows what will happen. If you buy and rates go down you can refinance, if they go up, you’ll be glad you didn’t wait. We’re still below the average 30-year mortgage interest rate over the last 50 years.”

Sellers are also still getting good offers fairly quickly. At a median of 13 days, homes are still selling even faster than in May 2020—there are just fewer sales. But, there are also fewer listings. Both supply and demand downshifting together means the balance between buyer and seller activity has remained tight. And those sellers accepted offers at 101.1 percent of their list price—down from 104.1 percent from last May but clearly still a strong figure. The Twin Cities metro remains a seller’s market, just not to the same degree as last year. The 1.8 months supply of inventory for May was up 28.6 percent. Typically 4-6 months of supply are needed to achieve a balanced, neutral market.

Location & Property Type

Market activity varies by area, price point and property type. New home sales rose 34.6 percent while existing home sales were down 23.0 percent. Single family sales fell 23.6 percent, condo sales declined 8.5 percent and townhome sales were down 3.9 percent. Sales in Minneapolis decreased 13.1 percent while Saint Paul sales fell 29.8 percent. Cities such as Watertown, Medina, Corcoran, Dayton and Shakopee saw the largest sales gains while Buffalo, Monticello, Cambridge and Zimmerman all had notably lower demand than last year.

For more information on weekly and monthly housing numbers visit www.mplsrealtor.com or www.spaar.com

May 2022 Housing Takeaways (compared to a year ago)

• Sellers listed 6,645 properties on the market, a 17.6 percent decrease from last May
• Buyers signed 4,901 purchase agreements, down 19.3 percent (3,994 closed sales, down 28.1 percent)
• Inventory levels shrank 9.0 percent to 6,864 units
• Month’s Supply of Inventory rose 28.6 percent to 1.8 months (4-6 months is balanced)
• The Median Sales Price softened 1.3 percent to $370,000
• Days on Market rose 65.2 percent to 38 days, on average (median of 13 days, up 85.7 percent)
• Changes in Sales activity varied by market segment
  • Single family sales decreased 23.6 percent; Condo sales were down 8.5 percent & townhouse sales fell 3.9 percent
  • Traditional sales declined 19.6 percent; foreclosure sales rose 67.9 percent; short sales decreased 33.3 percent (12 to 8)
  • Previously owned sales were down 23.0 percent; new construction sales rose 34.6 percent

  
  From The Skinny Blog.