26 Mar Real Estate Market March 26th Minnesota
Minnesota Real Estate Market March 26th
Here is our real estate market March 26th, 2021, Minnesota real estate weekly update. It is finally here…our spring real estate season! Last year was one to forget in many ways and we all have been looking forward to 2021 and some normalcy.
Unfortunately, we continue to have coronavirus concerns for our nation, the State of Minnesota, and the Minneapolis/St. Paul metro area, but hope is eternal. With masks, vaccinations, and herd immunity we are looking forward to having our normal existence back again. We are still wearing masks in all indoor spaces and restrictions are now being relaxed. The Pandemic has impacted our Minnesota real estate market and virtually all aspects of our life. While we are busy doing Minnesota real estate, we are just doing it differently. As an example, the buyers are now driving their car to all showings. The sellers are taking precautions that include having to sanitize their homes before and after showings. Showings are limited to 30 minutes. And only now overlapping showings. Young children are discouraged from attending showings. Of course, buyers and agents are wearing masks during showings. Real estate closings have sellers pre-signing, and buyer(s) only attend closings since only essential people are allowed. Lastly, we use virtual tours and lots of photos to help determine if the buyers want to see the home or make an offer-physically sight unseen. Open houses continue to be rare and not generally recommending by the Board of Realtors.
We review real estate facts and future trends
Right now, we have an abundance of buyers in the marketplace, but unfortunately not enough inventory of homes for sale. Our inventory of homes is low and last week we down 22% for new listings from the same week in 2020. As a result, we will continue to see multiple offers on all listings. What does that mean to you? It means you should have an experienced real estate agent to give you go suggestions and options, so you come out ahead. That means getting maximum sales price for your house or be the buyer who has the winning bid with multiple offers!
Facts are helpful since they give us insight into analyzing the trends and our market future. Still, it is our job to interpret the data. Our current affordability Index for Minnesota real estate is 143, compared to 154 last year at this same time. The higher the number means the greater the affordability. As of right now our inventory of available homes for sale is 4,857. For a comparison, we had 9,082 in 2020. So, the inventory of homes for sale is down 46.5% from last year. In further contrast, in 2009 we had over 36,000 homes for sale in the Minneapolis/Saint Paul metro area. Lastly, our Minnesota real estate pending sales for the week before last, which are those homes sold but not closed, was 1,252. In comparison to 1,195 pending home sales last year. As a result, we have 4.8% more pending sales than last year for that same week period. So as our pending sales slightly increased, and our inventory dramatically decreased. So, our monthly supply of homes is now down to .9 month compared to 1.7 last year at this time.
Minnesota seller’s benefit when real estate values rise. The median sales price increased by 11.1% since this time last year. $314,000 is now the median sales price in the Twin Cities area. A good market health indicator is the comparison of our sales price to original list price. Our average sale to list price is currently 100.1%. And that compares to 98% last year. Also, an important indicator of Minnesota real estate market strength is the average days on the market. Our 46 average days on the market reflects a healthy, and brisk, Minnesota real estate market (compared to 67 days last year at the same time). For even more Minnesota real estate market information visit my website at https://www.mnrealestate.com/twin-cities-information/area-appreciation-rates/ . It is a comprehensive review of our Minnesota real estate market for those that like all the data!
Our current interest rates in the Twin Cities
Low interest rates substantially increase the purchase power and price range of a buyer’s home purchase. So, our current interest rates are a real benefit to our Minnesota real estate market. Many mortgage companies love to provide mortgages to Minnesota home buyer’s, and this is because of our low delinquency and unemployment rates. This results in a low mortgage risk. As a result, we have some of the best home mortgage rates in the United States. These rates are slightly up from last week. Rates are 2.25% for VA, 2.25 for FHA and 2.699% for conventional. The trend seems to be an increase in rates for months and years to come. Feel free to reach out to me if you need contact information of a lender with those rates.
My opinion of future Minnesota real estate trends
I have seen different Minnesota real estate markets and trends over the last 30 years. With coronavirus it makes this a more difficult summer and fall market to predict. What I hear from many high-level business leaders and financial experts is that our economy still has some difficult times ahead. So, it is my opinion that we will have an active spring and summer with low home inventory. But as evictions and business closures run their course later this year it will affect inventory as people are forced to sell their home because of a job loss and the pandemic. So next fall and winter will be more of a sensible market as inventory begins to meet demand. This spring and summer it will be beyond rational – demand exceeds availability! Interest rates will continue to be historically low, and the federal reserve says it will not raise rates this or next year. But the 10-year Treasury rate has been trending up as the prospect of inflation raises its ugly head. This impacts mortgage interest rates more than Federal Reserve actions.
This is a good time to discuss your housing needs for 2021!
Your house and your neighborhood Minnesota real estate market
We find that each price range and neighborhood have its own specific trends and facts. In so if you are interested in knowing the specifics for your home…Contact Jeff Today.