(June 16, 2021) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyer activity in May was up 15.7 percent compared to last year, a twelfth-straight increase in month-over-month pending sales. Demand from buyers in the Twin Cities metro continues to out-pace the supply of new listings into the market.

Seller activity in May grew slightly in a year, up 2.6 percent from 2020, but dropped by 19.9 percent compared to 2019, our most recent pre-COVID year. The relative imbalance in performance between buyers and sellers has led to a strong seller’s market. Currently, the Twin Cities has 1.0 month’s supply of inventory. Typically, four to six months is considered a balanced market.

“Half of all listings in the Twin Cities have an accepted offer within a week,” according to Tracy Baglio, President of the Saint Paul Area Association of REALTORS®. “As the summer season begins to build, buyers need to continue to be prepared to make firm decisions and strong offers on a home.”

In May, homes spent a median seven days on market, which is down 56.3 percent from last year. The quick shelf life of listings is particularly impressive given that the median price of a home in the Twin Cities metro rose to $342,500, a 16.1 percent increase from last May. The 30-Year Fixed Rate Mortgage Average in the United States did not exceed 3.0 percent, giving buyers the ability to stretch their dollar further.

“Recent showing activity shows that prospective home buyers shifted their interests to more expensive homes,” said Todd Walker, President of Minneapolis Area REALTORS®. “Two years ago, listings priced under $200,000 saw the largest share of showing activity. This year listings around $250,000 have seen the greatest share of activity.”

Activity varies by area, price point and property type. Sales of single-family homes were up 42.1 percent in Minneapolis and 16.7 percent in St. Paul, suggesting demand remains strong in the core cities. Condos continue to lead sales growth by property type. Across the 16-county Twin Cities region condo sales rose 98.3 percent. Sales of previously owned homes rose 18.3 percent while new construction rose 5.5 percent.

May 2021 by the numbers compared to a year ago

• Sellers listed 7,576 properties on the market, a 2.6 percent increase from last May
• Buyers signed 6,834 purchase agreements, up 15.7 percent (5,543 closed sales, up 15.4 percent)
• Inventory levels fell 46.9 percent to 5,687 units
• Month’s Supply of Inventory was down 54.5 percent to 1.0 month (4-6 months is balanced)
• The Median Sales Price rose 16.1 percent to $342,500
• Days on Market decreased 41.5 percent to 24 days, on average (median of 7 days, down 56.3 percent)
• Changes in Sales activity varied by market segment
  • Single family sales were up 10.7 percent; condo sales rose 98.3 percent; townhome sales increased 13.6 percent
  • Traditional sales rose 16.6 percent; foreclosure sales were down 35.8 percent; short sales fell 63.6 percent
  • Previously owned sales were up 18.3 percent; new construction sales dropped 5.5 percent

From The Skinny Blog.

Market times fastest in 14 years amid record home prices in the Twin Cities

(May 17, 2021) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, seller activity in April was up 21.7 percent compared to last year, when new listings dipped partly due to COVID-19. The number of homes that were put on the market in April is comparable to pre-pandemic levels in 2019 and 2018.

The median price of a home in the 16-county Twin Cities metro rose to $337,000, a 10.5 percent increase from last April and a new record high for the region. Even so, half of homes go under contract within 8 days of listing, the fastest time in at least 14 years. This is a clear indication that the metro is still in need of a greater housing supply to keep up with rising demand.

“It’s promising to see improvements in housing supply, but it’s clear that we aren’t out of the woods just yet,” said Todd Walker, President of Minneapolis Area REALTORS®. “In time, more potential sellers will be encouraged to list, enticed by rising prices and more inventory. In the meantime, developers need incentives to expand new inventory, particularly in affordable price ranges.”

Although supply rebounded to that of pre-pandemic levels in April, the increase in demand was even greater. Pending sales are up 34.0 percent from April of last year and exceed 2019 numbers by 8.2 percent. With 5,619 homes for sale, the Twin Cities currently has 1.0 month’s supply of inventory. Typically, 4-6 months is considered a balanced market.

“Buyers still benefit from record low mortgage rates at around 3.0 percent,” according to Tracy Baglio, President of the Saint Paul Area Association of REALTORS®. “Although a limited supply is driving prices higher, low rates are a strong incentive to offer a competitive bid for a home.”

Activity varies by area, price point and property type. Sales of single-family homes were up 32.0 percent in Minneapolis and 14.8 percent in St. Paul, suggesting demand remains strong in the core cities. Across the 16-county Twin Cities region condo sales rose 50.6 percent, outpacing single-family and townhomes. Sales on previously owned homes rose 10.3 percent while new construction rose 2.0 percent. Luxury property sales ($1M+) are up 180.6 percent from last April, 90.6 percent from April 2019.

April 2021 by the numbers compared to a year ago

• Sellers listed 7,468 properties on the market, a 21.7 percent increase from last April
• Buyers signed 6,220 purchase agreements, up 33.6 percent (5,088 closed sales, up 8.8 percent)
• Inventory levels fell 45.8 percent to 5,619 units
• Month’s Supply of Inventory was down 52.4 percent to 1.0 month (4-6 months is balanced)
• The Median Sales Price rose 10.5 percent to $337,000
• Days on Market decreased 34.0 percent to 31 days, on average (median of 8 days, down 52.9 percent)
• Changes in Sales activity varied by market segment
  • Single family sales were up 3.6 percent; condo sales rose 50.6 percent; townhome sales increased 17.0 percent
  • Traditional sales rose 10.1 percent; foreclosure sales were down 44.1 percent; short sales fell 69.2 percent
  • Previously owned sales were up 10.3 percent; new construction sales climbed 2.0 percent

From The Skinny Blog.