18 Nov Our Minnesota real estate weekly update
This is our Minnesota real estate weekly update for November 18th, 2022. We are experiencing an ever-changing Minnesota real estate market.
We review real estate facts and future trends
We are now in a neutral selling market (neither a buyer nor seller’s market). This means you will start to see buyers coming in with offers contingent on them selling their home. In this market you should have a listing agent that has a comprehensive marketing plan. And you should strongly consider working with an experienced real estate agent to give you an edge in buying. Experience is priceless!
Here are the current facts for our Minnesota real estate market. Our current housing affordability Index for Minnesota real estate for October was 90, and this compares to 130 this same time last year. 90 is the lowest ever recorded. The higher the number means the greater home buying affordability in the Twin Cities. Our current inventory of homes for sale is 8,858. In comparison, we had 8,214 in 2021. So, the inventory of homes for sale is up 7.8% from last year. A point of interest, in 2009 at the time of our first real estate correction in Minnesota in 40 years, we had over 36,000 homes for sale in the seven county Minneapolis/St. Paul metro area. Minnesota real estate pending sales for the last week, which have sold but not yet closed, was 751. That compares to 1,200 pending home sales last year. That is a decrease of 37.4% from the same week last year. An average real estate market would have a three-month supply of housing inventory and we have 1.9 months. Last year it was a 1.5 months’ supply.
Minnesota seller’s benefit financially when real estate values rise. The median sales price (October) increased by 4.7% since this time last year. $356,000 is now the median sales price in the Twin Cities area. A market health indicator is the comparison of our sales price to original list price. For October, the average sale to list price was 98.2%. And that compares to 100.3 % in 2021. That number will adjust downward as we get November figures. For even more Minnesota real estate market information visit my website at https://www.mnrealestate.com/twin-cities-information/area-appreciation-rates/. It features a comprehensive review of our Minnesota real estate market for those that like all the data!
Our current interest rates in the Twin Cities
The low interest rates had been a catalyst for buying power for buyers the last two years, but rates have more than doubled this year. These interest rate increases are designed to reduce the rise of inflation, but they will also impact what buyers can afford. Rates for lender paid closing costs are 7.235% for VA, 7.042% for FHA and 7.342% for conventional. Rates for borrower paid are 5.375% for VA and FHA is 5.250% and 5.875% for Conventional. Just reach out to me if you need contact information of a lender with those interest rates.
My opinion of the future of Minnesota real estate
I have experienced different real estate markets in over 30 years of real estate and supply and demand continue to control our market. With inflation forcing the Federal Reserve to raise interest rates we do not have rate increases in our rearview mirror yet. This is having a negative effect on the market and what buyers can afford. As a result, buyers may decide to rent instead of buying for the short term. We are now in a neutral real estate market.
This is a suitable time to discuss your housing needs for 2022 and 2023!
Your house and neighborhood in our MN real estate market
We find that price ranges and neighborhoods have its own specific trends and facts. In so if you are interested in knowing the specifics for your home…just call Jeff.
The Anderson Team