29 Nov Real Estate Market November 29th
Real Estate Market November 29th
Here is our November 29nd real estate update. It is officially fall season in Minnesota. But looking outside you would think it is winter! Now it’s time to have the snowblower ready to go. Next, get the de-ice pelts for the ice on the front steps. Lastly, make sure to winterize your outside spigots. Of course, we also have a different real estate climate this time of the year in Minnesota.
We review real estate facts and trends
Real Estate Market November 22nd trends
In the winter we have a smaller buyer pool. As well as a smaller inventory of homes to purchase. Meanwhile our days on the market increases and showings on homes decrease. In fact, it is normally a good time of year for price reductions. Of course, that depends on days on the market and current demand. However, we do find that each area and price range is different. On the other hand, our first-time home buyer market is still active in most areas. That price range is $175,000 to $300,000 in Minneapolis, St Paul and area suburbs.
Facts are wonderful since they give us insight into analyzing the trends. Still, it is up to us to interpret them. Our current affordability Index is 147, compared to 142 last year at this time. So, the higher the number means greater affordability. Currently, our inventory of available homes is 11,147. In comparison, to 11,876 in 2018. In other words, the inventory of homes for sale is down 6.1%. In contrast, in 2008 we had almost 36,000 homes for sale in the Twin Cities. Lastly, our pending sales, which is those sold but not closed, is 999. As opposed to 940 pending sales last year. As a result, we have 6.3% more pending sales than last year.
We all benefit as sellers when values continue to raise. In so a median sales price increase 5.7% is a strong number. And $280,000 is the median sales price in the Twin Cities area. I have found a powerful market indicator is the comparison of our sales price to original list price. I’m pleased to say our average sale to list price is 98.1%. This compares to 98% last year. Equally important indicator of market strength is days on the market. Therefore, 46 average days on the market reflects a healthy real estate market.
Our current interest rates in the Twin Cities
Interest rates increase the affordability of your home purchase. Consequently, low interest rates are a real benefit to real estate market in Minnesota. In fact, mortgage companies love to provide mortgages to Minnesota. Because of our low delinquency and employment rates. But most importantly our low mortgage risk. Accordingly, we have some of the best mortgage rates in the United States in the Twin Cities. There has been no movement in mortgage interest rates over the last week. The rates are 3.375% for VA, 3.25% for FHA and 3.99% for conventional. Furthermore, I know of a lender who has no or very limited fees at those interest rates.
My opinion of future real estate trends
We have seen many types of markets and trends in the last 30 years. So, it is my opinion that we will continue to have 2 to 4% appreciation in 2020. Likewise, I predict the inventory of first-time homebuyer homes will not be insufficient to match demand. Also, the areas with an abundance of new construction will have longer marketing times for existing homes. Finally, interest rates will continue to be historically low for at least until the November election.
Your House and neighborhood real estate market
We find that each price range and neighborhood has its own specific trends and facts. In so, if you are interested in knowing the specifics for your home. Contact The Anderson Team.