October pending sales rose 3.3 percent to 4,331 contracts. New listings decreased 2.6 percent to 5,798 as fewer sellers listed their properties for sale. It should come as no surprise that inventory levels fell 16.7 percent to 14,911 active units—extending a long-standing supply crunch that is frustrating some buyers but helping sellers yield multiple offers. As one might expect, prices thus continued to rise with the median sales price increasing 4.9 percent compared to last October. That is wholly in line with long-term year-over-year appreciation before factoring for inflation. The median list price rose 4.4 percent to $240,000, while the average price per square foot rose 3.2 percent to $127.
With tight supply and strong demand, sellers accepted a larger share of their original list price as offers were more competitive. The percent of original list price received at sale was up 1.1 percent to 96.2 percent. Homes tended to sell in less time. Days on market declined 2.8 percent to 70 days. Both of these trends are consistent with a sellers market. Further evidence that it’s a good time to sell came by way of months supply of inventory, which fell 25.6 percent to 3.2 months of supply. Generally, five to six months of supply is considered balanced. While the metro as a whole is favoring sellers, not all areas, segments and price points reflect that.
“Sellers are still a bit hesitant,” said Mike Hoffman, Minneapolis Area Association of REALTORS® (MAAR) President. “That said, factors such as low interest rates, rising rents, prices still below their peak and accelerating job and wage growth also paint a compelling picture for buyers.”
Other market measures show ongoing improvements as well. The percentage of all sales that were foreclosure or short sale has shrunk to less than 10.0 percent. Sales activity in the lower price ranges ($150,000 and below) is declining while activity in all other price ranges is rising. At the high end of the market, year-to-date sales activity in the $1,000,000 and up range has reached all-time record highs. Though it’s not yet the case for the entire region, home prices across several local markets including St. Louis Park, Edina and Southwest Minneapolis have also reached record highs.
The broader economy has been favorable to market recovery. The October jobs report not only beat expectations but it also showed the strongest wage growth in six years—a critical factor that will offset declining affordability and help with down payments. Unemployment has been cut in half from its peak and consumer confidence is rising. October Bureau of Labor Statistics figures show the Minneapolis-St. Paul-Bloomington metropolitan area had the lowest unemployment rate of any major metro at 3.1 percent compared to 5.0 percent nationally. Mortgage rates are still around 4.0 percent compared to a long-term average of over 7.0 percent. A rate hike at the Federal Reserve is expected in December, though changes in mortgage rates will be slow and incremental.
“As we near the end of 2015, it’s clear that home buyers were motivated and eager to make their move,” said Judy Shields, MAAR President-Elect. “Moving forward, we’ll be watching the affordability environment, inventory levels and new construction as we adapt to changing consumer preferences and a changing interest rate climate.”
From The Skinny Blog.
For Week Ending November 14, 2015
For the next several weeks, activity will be lower than it is during the rest of the year but not in complete hibernation. The quietest weeks of the season in residential real estate sales are traditionally from Thanksgiving to New Year’s Day. Generally, we see fewer new listings, less inventory and fewer sales than at any other time during the year. That said, higher year-over-year sales prices are common across the country thanks to things like high demand, low inventory and exceptional interest rates.
In the Twin Cities region, for the week ending November 14:
- New Listings increased 19.5% to 1,024
- Pending Sales increased 22.0% to 894
- Inventory decreased 16.5% to 14,606
For the month of October:
- Median Sales Price increased 4.2% to $216,500
- Days on Market decreased 2.8% to 70
- Percent of Original List Price Received increased 1.1% to 96.2%
- Months Supply of Inventory decreased 25.6% to 3.2
All comparisons are to 2014
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
For Week Ending November 7, 2015
In a continually improving economy, what we might expect to happen is happening in the housing market. Sales and prices are generally up in year- over-year comparisons, and new listings are replenishing the market at a fairly steady clip. More sellers are still encouraged to enter the fray, as lower inventory continues to remain a point of some concern.
In the Twin Cities region, for the week ending November 7:
- New Listings increased 7.5% to 1,183
- Pending Sales increased 10.7% to 907
- Inventory decreased 16.2% to 14,850
For the month of October:
- Median Sales Price increased 4.4% to $217,000
- Days on Market decreased 2.8% to 70
- Percent of Original List Price Received increased 1.1% to 96.2%
- Months Supply of Inventory decreased 25.6% to 3.2
All comparisons are to 2014
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
For Week Ending October 31, 2015
Softer September sales continue to be a stout topic for stats analysis. Rental prices are not so soft, however, and across many markets, rising prices are turning heads. More first-time homebuyers may jump at the chance to invest in their own homes. Much of the evidence still points to recovering market health.
In the Twin Cities region, for the week ending October 31:
- New Listings increased 1.9% to 1,096
- Pending Sales increased 0.6% to 933
- Inventory decreased 16.2% to 15,440
For the month of October:
- Median Sales Price increased 4.9% to $218,000
- Days on Market decreased 2.8% to 70
- Percent of Original List Price Received increased 1.1% to 96.2%
- Months Supply of Inventory decreased 25.6% to 3.2
All comparisons are to 2014
Click here for the full Weekly Market Activity Report. From The Skinny Blog.