The Skinny – Page 5

December 21, 2020

Despite pandemic, this year is on-track for record-breaking sales

New listings flat, sales up, price growth strong, market times fast, but supply levels extremely low

(December 17, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, the growth in buyer and seller activity in the 16-county Twin Cities metro continues to climb above 2019 levels. Seller activity rose 1.3 percent from last November while new purchase agreements were up 13.4 percent over last year. That marks the strongest November pending sales figure since 2004 and the highest closed sales since at least 2003.

This year, the fall and winter markets are behaving more like a spring market since activity was delayed from the spring and summer months. While sellers only listed slightly more units than last November, pending and closed sales were up significantly. Pending sales often act as a leading indicator of future demand while closings lag.“The Twin Cities housing market continues to exceed expectations,” according to Patrick Ruble, President of the Saint Paul Area Association of REALTORS®. “Despite record sales figures, the lack of adequate supply—particularly affordable units—continues to frustrate buyers.”

Historically low mortgage rates, shifting work and learning patterns, health concerns and other factors are driving this sellers’ market. While all areas and price points are unique, sellers are getting strong offers early on. On average, sellers obtained 100.2 percent of their original list price—the highest November figure since at least 2003. At a median of 15 days, homes went under contract in record time, and 48.3 percent faster than last November.

“It’s truly impressive that sales would reach new highs during a pandemic and an otherwise challenging year,” said Linda Rogers, President of Minneapolis Area REALTORS®. “That’s of course meant rising home prices, but luckily, ultra-low interest rates have been able to partly offset that.”

Sales were up 21.5 percent in Minneapolis and 30.8 percent in St. Paul, suggesting buyers are eager to quickly snap up any new listings. And the competitive landscape means those buyers are often going above list price. With prices slightly lower, market times higher and offers weaker, the condo market continues to lag other segments. However, sales of luxury properties ($1M+) have been soaring higher—up nearly 20.0 percent YTD. One thing is clear: the housing market continues to outperform, despite the many economic headwinds.

November 2020 by the numbers compared to a year ago

Sellers listed 4,035 properties on the market, a 1.3 percent increase from last November
Buyers signed 4,640 purchase agreements, up 13.4 percent (5,624 closed sales, up 18.6 percent)
Inventory levels fell 37.9 percent to 6,642 units
Months Supply of Inventory was down 42.9 percent to2 months (5-6 months is balanced)
The Median Sales Price rose 10.7 percent to $310,000
Days on Market decreased 33.3 percent to 34 days, on average (median of 15, down 48.3 percent)
Changes in Sales activity varied by market segment
- Single family sales were up 21.3 percent; condo sales fell 2.6 percent; townhome sales increased 20.6 percent
- Traditional sales rose 19.7 percent; foreclosure sales were down 22.9 percent; short sales fell 18.8 percent
- Previously owned sales were up 21.7 percent; new construction sales climbed 4.8 percent

From The Skinny Blog.

November 19, 2020

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Sales outpacing supply, prices accelerate, core cities remain strong

New listings and sales up, price growth accelerating, but supply levels extremely low

(November 19, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyer and seller activity in the 16-county Twin Cities metro continue to outpace 2019. Seller activity rose 8.4 percent compared to last October while buyer activity was up 21.8 percent, marking the strongest October sales figure since at least 2003.

Buyers are motivated by expectations of working and spending more time at home and are also buoyed by historically low interest rates. That has resulted in a highly competitive marketplace where sellers get strong offers—sometimes above asking price—in record time and often with multiple offers. It has also caused inventory levels to plummet, frustrating many buyers.

“Buyers are still out in force, which is fairly unusual for this time of year when things typically quiet down,” according to Patrick Ruble, President of the Saint Paul Area Association of REALTORS®. “But the shortage of inventory and fast pace of the market are still keeping some waiting in the wings.”

Record-low mortgage rates, a desire for more space, a shortage of listings and Millennials aging into homeownership have all led to record-setting demand and rising prices among other changes. This is unusual during a recession, which impacts people differently. The mid-market move-up ranges and luxury segments have been performing better as salaried professionals have been spared much of the hardship. Conversely, many would-be buyers in the most affordable price points have been sidelined as they’re more likely to be impacted by job or income loss.

Still firmly in the driver’s seat, sellers, on average, accepted offers at 100.5 percent of their original list price—matching a high for any month going back to at least 2003. At 35 days on average, homes across the metro sold 23.9 percent quicker than last October.

“Despite some earlier challenges, Minneapolis and St. Paul are still seeing strong sales growth,” said Linda Rogers, President of Minneapolis Area REALTORS®. “They’re still quite competitive.”

For example, new listings rose 35.5 percent in Minneapolis and 22.8 percent in St. Paul while sales were up 47.4 and 28.9 percent, respectively. Demand in the core cities is once again outpacing supply. Downtown condos are still an area of weakness, but metro-wide sales of homes priced over $1M are up over 98.0 percent from last October.

October 2020 by the numbers compared to a year ago

Sellers listed 6,816 properties on the market, an 8.4 percent increase from last October
Buyers signed 6,249 purchase agreements, up 21.8 percent (6,674 closed sales, up 22.3 percent)
Inventory levels fell 34.5 percent to 8,080 units
Months Supply of Inventory was down 40.0 percent to5 months (5-6 months is balanced)
The Median Sales Price rose 12.5 percent to $315,000
Days on Market decreased 23.9 percent to 35 days, on average (median of 14, down 44.0 percent)
Changes in Sales activity varied by market segment
- Single family sales were up 24.07percent; condo sales rose 8.6 percent; townhome sales increased 17.6 percent
- Traditional sales rose 22.3 percent; foreclosure sales were down 20.4 percent; short sales fell 6.7 percent
- Previously owned sales were up 20.1 percent; new construction sales climbed 43.4 percent

All information is according to the Minneapolis Area REALTORS® and Saint Paul Area Association of REALTORS based on data from NorthstarMLS. We serve the Twin Cities 16-county metro area and western Wisconsin.

October 19, 2020

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Another record-setting month, though sales rising faster than listings

New listings and sales up, price growth strong, but supply levels wearing thin

(October 19, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyer and seller activity in the 16-county Twin Cities metro both increased from 2019.

This summer and even early fall market continue to resemble more of a spring market. Although some activity from the 2nd quarter was shifted into the 3rd quarter, buyers more than made up for the lost time and continued to ink new records. Sales activity year-to-date is already above last year. Seller activity—while still lagging—made its largest gain since March.

Specifically, pending sales rose 27.7 percent compared to last September to 6,443, marking at least an 18-year record high for the month going back to 2003. At 7,771, new listings were up 9.8 percent, which was the highest September since 2008.

“The demand out there in the market at this time of year is truly remarkable—especially during a pandemic,” according to Linda Rogers, President of Minneapolis Area REALTORS®. “Even though seller activity is on the rise, inventory levels remain extremely low, particularly in the affordable ranges. Serious buyers should be prepared to write strong offers quickly.”

While nothing about 2020 could be called predictable, one predictable outcome of historically strong housing demand and tight supply is rising prices. The metro-wide median sales price rose 10.8 percent to $310,000, the largest year-over-year gain since February 2018. The median sales price for new homes, however, rose 2.7 percent to $417,000 while existing home prices rose 11.1 percent to $300,000.

Multiple offer situations remain common as a large pool of buyers compete over a thinning stock of properties. Sellers, on average, accepted offers of 100.5 percent of their original list price—marking a new high for any month going back to at least 2003. A balanced market typically has 5-6 months of supply. At 1.7 months, sellers are still in the driver’s seat in most areas.

With such an imbalance in market forces, properties sold 31.8 percent faster than last year. Half the sales occurred in less than 15 days, tying with August for a 14-year record pace. “Even though activity is strong overall,” said Patrick Ruble, President of the Saint Paul Area Association of REALTORS®. “Every city, neighborhood, price range and property type are unique.”

For example, sales rose 41.4 percent in Minneapolis and 33.8 percent in St. Paul while new listings were up 47.8 and 17.7 percent, respectively. Seller activity in Minneapolis reached its highest level since 2007, while seller activity in the metro overall reached its highest level since 2008. The region’s condo market, however, saw new listings rise 28.9 percent while sales fell 2.6 percent. The metro condo market has 4.0 months of supply while that figure is 6.0 months in Minneapolis. Perhaps driven by attractive jumbo rates, sales of homes priced over $1M are up over 60.0 percent from last September.

September 2020 by the numbers compared to a year ago

- Sellers listed 7,771 properties on the market, a 9.8 percent increase from last September
- Buyers signed 6,443 purchase agreements, up 27.7 percent (6,583 closed sales, up 21.1 percent)
- Inventory levels fell 32.0 percent to 8,936 units
- Months Supply of Inventory was down 37.0 percent to7 months (5-6 months is balanced)
- The Median Sales Price rose 10.8 percent to $310,000
- Cumulative Days on Market decreased 15.9 percent to 37 days, on average (median of 15, down 31.8 percent)
- Changes in Sales activity varied by market segment
  - Single family sales were up 34.0 percent; condo sales fell 2.6 percent; townhome sales increased 16.5 percent
  - Traditional sales rose 29.6 percent; foreclosure sales were down 47.1 percent; short sales were flat
  - Previously owned sales were up 26.7 percent; new construction sales climbed 53.1 percent

From The Skinny Blog.

September 24, 2020

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Another record-setting month despite shortage of listings

New listings and sales up, price growth strong, but some activity from Q2 was postponed into July/August

(September 18, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyer and seller activity in the 16-county Twin Cities metro both increased from 2019.

After a 12.0 percent gain in July, the number of signed purchase agreements rose 19.7 percent in August, compared to last year. At 7,181 pending sales, August 2020 had the highest recorded pending sales count for the month, and also the highest for any month of any year going back to June 2004. Although some of the pent-up demand from June and July was shifted into August, recent gains have turned year-to-date pending sales positive—now up 4.3 percent compared to 2019.

“Buyers were truly out in force last month,” according to Linda Rogers, President of Minneapolis Area REALTORS®. “The gains were widespread, with both urban and suburban locations appealing to home buyers.”

Relentless demand and diminished supply have accelerated home price growth. The median sales price in the metro rose 9.8 percent to $315,000. Excluding July of this year, that’s the strongest rate of price growth since March 2018. The median price of a newly built home was around $405,000. Historically low mortgage rates below 3.0 percent can partly offset affordability challenges caused by rising prices.

Despite a modest gain in new listings from last August, buyer demand continued to overwhelm sellers. Multiple offer situations are commonplace, and many sellers are accepting offers above list price. In fact, sellers received, on average, 100.3 percent of their original asking price—matching the 18-year record high from June 2018. A balanced market typically has 5-6 months of supply. At just 1.7 months, sellers are still in the driver’s seat.

As sales hit a new high, market times reached a new low. Half of the sales occurred in less than 15 days. “People are searching high and low for properties that meet their needs,” said Patrick Ruble, president of the Saint Paul Area Association of REALTORS®. “Attractive rates and a lack of supply means homes won’t last long on the market.”

While an expectation of prolonged tele-commuting has encouraged some to seek more space farther out, it’s notable that Minneapolis and St. Paul saw sales increase 28.1 and 29.2 percent respectively. New listings were also up notably in both cities. Condo sales rose 1.4 percent across the metro but were up 5.6 percent in Minneapolis and down 17.3 percent in St. Paul. The luxury segment has performed quite well recently. Metro-wide sales over $1M surged 51.1 percent from last August.

AUGUST 2020 BY THE NUMBERS COMPARED TO A YEAR AGO

Sellers listed 7,823 properties on the market, a 1.3 percent increase from last August
Buyers signed 7,181 purchase agreements, up 19.7 percent (6,765 closed sales, up 0.6 percent)
Inventory levels fell 32.4 percent to 8,756 units
Months Supply of Inventory was down 34.6 percent to7 months (5-6 months is balanced)
The Median Sales Price rose 9.8 percent to $315,000
Cumulative Days on Market decreased 4.9 percent to 39 days, on average (median of 15, down 28.6 percent)
Changes in Sales activity varied by market segment
- Single-family sales were up 23.2 percent; condo sales rose 1.4 percent; townhome sales increased 14.8 percent
- Traditional sales rose 20.4 percent; foreclosure sales were up 23.7 percent; short sales fell 28.6 percent
- Previously owned sales were up 18.8 percent; new construction sales climbed 46.4 percent

From The Skinny Blog.

August 24, 2020

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July signed purchase agreements highest since at least 2003

New listings up, price growth accelerates, but some activity from Q2 was postponed into July

(August 20, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyer and seller activity in the 16-county Twin Cities metro both increased from 2019.

After double-digit declines in April and May, the number of signed purchase agreements rose 7.5 percent in June and another 10.3 percent in July, both compared to last July. At 6,866, July 2020 saw the highest pending sales figure since at least 2003, and likely longer. However, some of the pent-up demand from April and May was shifted into June and July, meaning sellers accepted about as many offers this July as they typically have in May of each of the prior four years. Nevertheless, the gain has turned even year-to-date pending sales positive—now up 1.3 percent compared to 2019.

“With interest rates at record lows, in some cases below 3.0 percent, we are experiencing strong demand from buyers to lock in their purchases,” said Patrick Ruble, president of the Saint Paul Area Association of REALTORS®. “If not for the pandemic, some of these accepted offers in July that set new records might have taken place in May or June.”

Although new listings increased 0.8 percent from last July, sellers struggled to keep up with all the demand. Those that did sell received, on average, 100.1 percent of their original asking price—the 2nd highest figure on record since 2003 after June 2018. Price growth also accelerated; the median price jumped 10.4 percent to $312,500. Record-low interest rates can partly offset declines in affordability spurred by rising prices.

“July was an undeniably strong month, particularly in light of some of the headwinds,” according to Linda Rogers, President of Minneapolis Area REALTORS®. “Most areas saw sales growth and other improvements, including both large core cities, where buyers continued to outbid each other.”

Minneapolis sellers received offers that were on average 100.8 percent of their list price. In other words, sellers got more than their list price. In St. Louis Park, St. Paul and Brooklyn Park the figures were 101.3, 101.2 and 100.7 percent respectively. Both buyer and seller activity were up double-digits in both Minneapolis and St. Paul.

Some buyers are opting for newer, farther-out suburban subdivisions that are car-dependent and still growing but come with the latest technology and more space for tele-commuting. An uptick in condo listings can anecdotally be attributed more to health concerns and a temporary closure of businesses and limited activities than any recent unrest. More time is needed to evaluate this.

July 2020 by the numbers compared to a year ago

Sellers listed 7,961 properties on the market, a 0.8 percent increase from last July
Buyers signed 6,866 purchase agreements, up 10.3 percent (6,940 closed sales, up 3.4 percent)
Inventory levels fell 28.0 percent to 9,348 units
Months Supply of Inventory was down 29.6 percent to 1.9 months (5-6 months is balanced)
The Median Sales Price rose 10.4 percent to $312,500
Cumulative Days on Market increased 7.9 percent to 41 days, on average (median of 17, down 5.6 percent)
Changes in Sales activity varied by market segment
- Single family sales were up 7.3 percent; condo sales fell 10.8 percent; townhome sales decreased 2.6 percent
- Traditional sales rose 4.6 percent; foreclosure sales dropped 42.1 percent; short sales fell 6.7 percent
- Previously owned sales were up 2.5 percent; new construction sales climbed 27.7 percent

From The Skinny Blog.

July 20, 2020

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June signed purchase agreements reach highest level since 2004

New Highs For Showings Suggest Further Strengthening, Though Inventory Still A Challenge

(July 16, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, market activity in the 16-county Twin Cities metro continued to recover from the April and May declines.

After double-digit declines in April and May, the number of purchase contracts signed in June increased 6.2 percent from last year. That brought the number of pending sales to 6,819 for the month, the highest June figure since 2004. Some of the pent-up demand from April and May was shifted into June instead of being cancelled outright.

Most of the increase was in the single-family segment. Newly built homes also saw a large gain as buyers were eyeing more space and perhaps a second home office, but also found existing options limited. Record low mortgage rates were another motivating factor for buyers—particularly first-time buyers.

“It is still very busy, but there is little inventory,” said Patrick Ruble, president of the St. Paul Area Association of REALTORS®. “Buyers enticed by historically low mortgage rates in April or May can still capitalize on those rates now; however, because there is no inventory we really need to see an increase in listings.”

Sellers are struggling to keep up, though that may be changing. After greater than 20.0 percent declines during April and May, new listings shrank 14.6 percent in June. The share of the list price that sellers received was still down slightly from last year, but at 99.6 percent, it remains at a very high level. The region had 1.8 months of supply in June, indicating a strong and undersupplied sellers’ market. A balanced market has around 5 or 6 months of supply. By contrast, the over $1M luxury segment had more than 11.0 months of supply in June.

“An encouraging showings trend alongside strong demand and a limited supply of homes should continue to support prices,” said Linda Rogers, President of Minneapolis Area REALTORS®. “While still positive, the rate of price growth moderated in May. Now June home price growth is roughly on-pace with the last 12 months.”

The Federal Reserve pushed interest rates on a 30-year fixed mortgage to around 3.0 percent—the lowest figure recorded in more than 50 years. Attractive interest rates can partly offset declines in affordability. Despite that being a motivating factor, the limited supply of homes for sale is one of the biggest challenges for buyers. Sellers are slowly gaining more confidence around health concerns, but a resurgence in COVID-19 cases could dampen that. While condo sales were still lagging, the data shows buyer and seller activity in Minneapolis is comparable to surrounding cities and suburbs.

June 2020 By The Numbers Compared To A Year Ago

Sellers listed 7,306 properties on the market, a 14.6 percent decrease from last June
Buyers signed 6,819 purchase agreements, up 6.2 percent (6,118 closed sales, down 8.8 percent)
Inventory levels fell 29.8 percent to 9,154 units
Months Supply of Inventory was down 33.3 percent to8 months (5-6 months is balanced)
The Median Sales Price rose 5.2 percent to $305,000
Cumulative Days on Market increased 2.4 percent to 41 days, on average (median of 18)
Changes in Sales activity varied by market segment
- Single family sales were up 10.2 percent; condo sales fell 12.6 percent; townhome sales increased 0.4 percent
- Traditional sales rose 7.1 percent; foreclosure sales dropped 23.2 percent; short sales fell 29.4 percent
- Previously owned sales were up 5.1 percent; new construction sales climbed 35.2 percent

From The Skinny Blog.

June 18, 2020

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Market activity up in May from previous month, but down from 2019

New highs for showings hint at buyer confidence, but supply questions remain

(June 18, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, market activity was down from last May but increased from this April.The number of residential showings has reached a new high for the year. The decline in pending sales was about half that of new listings, as buyers were motivated by record-low mortgage rates. Pending sales were down just 2.5 percent in the $350-500K price range but fell 34.8 percent on homes between $750K-1M. For new listings, the reverse was true with the biggest declines in the affordable price range of $150-190K and the smallest drop in new listings for homes over $1M.

“Activity is moving through the system—fewer April contracts now means fewer closed sales in May,” said Linda Rogers, President of Minneapolis Area REALTORS®. “But smaller declines in May contracts combined with strong showing activity are reasons for cautious optimism.”Home prices rose to about $295K compared to last May, but it was the smallest percentage gain since January 2017. April was the first month on record where the median home price surpassed $300K. Homes also sold more quickly this May than last, as motivated buyers remained committed, but less serious buyers and “lookers” were not as active. The share of their list price that sellers received declined to 99.6 percent from 100.0 percent last May.

“We expected May to be a slight improvement from April and so far that is mostly true,” said Patrick Ruble, President of the St. Paul Area Association of REALTORS®. “Not only is showing activity displaying some strength, but the home buyers and sellers we work with are starting to feel more confident as well. Rates are at historic lows and should remain low throughout the year.”

Showing activity rose by 11.0 percent from the most recent week compared to the week prior and has reached new highs. The economic toll impacted market segments differently. First-time buyers are more likely to be impacted by job losses in the leisure, hospitality or retail space, while those shopping in the luxury brackets may be impacted by turmoil in equity and energy markets. The middle-market ranges are outperforming, helped along by professionals who can work from home. Given the lack of supply—especially close to the core cities—and price points in the low $400s, the new home market is more stable than the existing resale market.

Mortgage rates on a 30-year fixed loan are around 3.25 percent—the lowest they have ever been. While recessions can pause market activity, they typically only have a minor impact on home prices. A persistently undersupplied market—particularly for affordable homes—may help prices stay afloat.

May 2020 by the numbers compared to a year ago

Sellers listed 7,199 properties on the market, a 24.1 percent decrease from last May
Buyers signed 5,828 purchase agreements, down 13.9 percent (4,728 closed sales, down 22.4 percent)
Inventory levels declined 20.3 percent to 9,744 units
Months Supply of Inventory was down 20.0 percent to0 months (5-6 months is balanced)
The Median Sales Price rose 3.5 percent to $294,900
Cumulative Days on Market decreased 8.9 percent to 41 days, on average (median of 16)
Changes in Sales activity varied by market segment
- Single family sales fell 9.2 percent; condo sales were down 38.6 percent; townhome sales declined 18.4 percent
- Traditional sales decreased 13.2 percent; foreclosure sales dropped 4.3 percent; short sales fell 30.8 percent
- Previously owned sales were down 13.8 percent; new construction sales declined 0.5 percent

From The Skinny Blog.

May 26, 2020

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Record high showings the bright spot in April housing numbers

Buyer interest remains strong amid decline in listings and pending sales

(May 21, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, both buyer and seller activity was down in April, but the number of residential showings has reached a new high for the year.Both new listings and pending purchase activity was down in April compared to a year ago, but the declines varied dramatically by price range. For homes priced between $350,000 and $500,000, for example, sellers listed just 7.8 percent fewer homes than last April. Homes priced over $1,000,000, however, saw a 44.9 percent decrease in new listings. New listings at the far-affordable end of the market also saw notable declines.

“March started off strong and that strength returned later in April and into May; however, the latter half of March and the start of April saw set-backs due to COVID-19,” said Patrick Ruble, President of the Saint Paul Area Association of REALTORS®. “REALTORS® are busy, and we’ve seen gains for both buyers and sellers in late-April and May.”

The price gains in April may surprise some. In fact, April was the first month on record where the median home price surpassed $300,000. Home prices and closed sales both rose in April, reflecting purchase agreements signed in February and the first half of March. Homes actually sold more quickly this April than last, as health concerns held back some less serious buyers but motivated buyers who remained active and committed.

“We expected much of the pull-back resulting from COVID-19 would show up in April, so the shift isn’t that surprising,” said Linda Rogers, President of the Minneapolis Area REALTORS®. “But showings are a leading indicator for purchase activity and they’ve reached new highs for the year. We expect this to translate into stronger sales activity once the health situation stabilizes.”

The recent job losses have impacted some market segments more than others. Buyers in the affordable brackets are more likely to be impacted by job losses in the leisure, hospitality or retail space, while those looking in the luxury brackets may be impacted by volatility in equity markets. The middle-market ranges performed the best, perhaps propped up by salaried professionals who can work from home.

For April, the median Twin Cities home price was up 8.9 percent to $305,000, a new high for the metro area. Mortgage rates on a 30-year fixed loan are around 3.4 percent—just about the lowest they have ever been. While recessions can pause market activity, they typically only have a minor impact on home prices. The undersupplied market—especially at the affordable end—should also prevent any price softening.

April 2020 by the numbers compared to a year ago

Sellers listed 5,967 properties on the market, a 22.9 percent decrease from last April
Buyers signed 4,612 purchase agreements, down 20.1 percent (4,609 closed sales, up 3.5 percent)
Inventory levels declined 13.1 percent to 9,279 units
Months Supply of Inventory was down 18.2 percent to8 months (5-6 months is balanced)
The Median Sales Price rose 8.9 percent to $305,000 (over $300,000 for the first time ever)
Cumulative Days on Market decreased 17.5 percent to 47 days, on average (median of 17)
Changes in Sales activity varied by market segment
- Single family sales rose 11.1 percent; condo sales were down 33.2 percent; townhome sales declined 5.3 percent
- Traditional sales increased 5.0 percent; foreclosure sales dropped 33.7 percent; short sales fell 43.5 percent
- Previously owned sales were up 4.9 percent; new construction sales climbed 4.7 percent

From The Skinny Blog.

April 20, 2020

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A silver lining: Some early signs of turnaround in showings

Twin Cities home buyer activity is recovering amid safe REALTOR® practices

(April 17, 2020) – According to new data from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, the number of Twin Cities residential real estate showings displayed the first signs of a turnaround since they began declining during the onset of the coronavirus in mid-March.Since reaching their valley around April 2, showings have been on the rise. As of April 10, overall showings were up 16.1 percent compared to a week earlier. Reduced activity during the Easter and Passover holidays eroded that gain slightly, but that is likely a temporary blip.
“Despite some concerns among buyers and sellers, there’s clearly still activity occurring,” said Linda Rogers, President of Minneapolis Area REALTORS®. “It is still vital that REALTORS® continue to follow best practices for showing homes safely and to consider other options such as virtual tours.”

Both new listings and pending sales also saw declines in the second half of March and into April. New listings began to decline around March 26 and are now roughly 36.8 percent below their 2020 peak. The decline in buyer activity was earlier but not as severe. Pending sales began to decline around March 18 and are now about 19.1 percent below their peak.

“March was off to a strong start until the middle of the month when everything changed,” said Patrick Ruble, President of St. Paul Area Association of REALTORS®. “We even saw a double-digit gain in new listings, providing more options for buyers facing limited choices. The strength of the market preceding this crisis bodes well for a relatively quick recovery once this crisis is over.”

The monthly report for March, with its 16.0 percent gain in new listings and 11.2 percent increase in pending and closed sales, paints only a partial picture of COVID-19’s impact on the market. The numbers don’t fully reflect the effect of the stay-at-home order and school closures which occurred in the second half of the month. And most March sales were for purchase agreements that were finalized in January and February. The April numbers will offer a far more accurate view of COVID-19’s impact on the Twin Cities housing market – from sales, listings and inventory to market times and home prices.

For March, the median Twin Cities home price was up 8.0 percent to $297,000. Mortgage rates on a 30-year fixed loan are now around 3.4 percent—just about the lowest they’ve ever been. While recessions can pause market activity, they typically have only a minor impact on home prices. The undersupplied market—especially at the affordable end—should also shield prices.

March 2020 by the numbers compared to a year ago

Sellers listed 7,220 properties on the market, a 16.0 percent increase from last March
Buyers signed 5,148 purchase agreements, up 11.2 percent (4,155 closed sales, also up 11.2 percent)
Inventory levels declined 11.3 percent to 8,597 units
Months Supply of Inventory was down 15.0 percent to7 months (5-6 months is balanced)
The Median Sales Price rose 8.0 percent to $297,000
Cumulative Days on Market decreased 9.1 percent to 60 days, on average (median of 26)
Changes in Sales activity varied by market segment
- Single family sales rose 13.5 percent; condo sales were up 8.4 percent; townhome sales increased 8.1 percent
- Traditional sales increased 13.6 percent; foreclosure sales dropped 34.6 percent; short sales fell 9.5 percent
- Previously owned sales were up 13.5 percent; new construction sales climbed 5.9 percent

For more information on weekly and monthly housing numbers visit www.mplsrealtor.com.
From The Skinny Blog.

March 23, 2020

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Showings decline in Twin Cities amid coronavirus concerns

New data reveals fewer residential showings across most price ranges

(March 19, 2020) – According to new data from the Saint Paul Area Association of REALTORS® and the Minneapolis Area REALTORS®, the number of Twin Cities residential real estate showings declined in most price ranges during the week ending March 17 compared to the previous week. The declines, which come amid the coronavirus pandemic, were most prominent in the higher price brackets.

Showings decreased by 9.7% in the under $250,000 price bracket, where inventory is down significantly. The in-demand $250,000 to $350,000 price range was the only one that had an increase in showings. Homes priced over $1million saw a 33.2% decline in showings.

“It appears that concerns about spreading the coronavirus are starting to have an impact on our market,” said Patrick Ruble, President of the Saint Paul Area Association of REALTORS®. “REALTORS® are encouraged to follow the most current best practices in accordance with their brokers, which should be following the CDC guidelines. This includes activities such as open houses, active listings and interactions with clients and visitors.”

New listings, which are usually on the rise this time of year, have been weakening over the past couple of weeks. Active listings, or the total number of homes for sale, have also started softening in recent days. On a positive note pending sales, or the number of signed purchase agreements, remained strong during this period.

“Buyers in the more affordable price ranges embraced the low rates and mild weather,” said Linda Rogers, President of Minneapolis Area REALTORS®. “We are noticing fewer showings in the higher price points, reflecting both buyer and seller concerns and time will tell how the rest of the month plays out.”

In other news, the February numbers showed buyer and seller activity were up compared to last year. But the gains appear deceptively large due to weather challenges that held activity back in February 2019. Even so, the gains—particularly for pending sales—also outpaced 2018 levels.

Seller listing activity effectively recovered after the snow and melt we saw in 2019 and then increased slightly over 2018 levels. The nearly 24.0 percent increase in pending sales—or the number of signed purchase agreements—goes beyond weather. Mortgage rates have fallen throughout the year and spent most of February below 3.5 percent, compared to around 4.5 percent in February 2019. The Federal Reserve recently acted to further lower interest rates to limit the downside risks of COVID-19 to the economy. Home sales help the economy and low rates help to hedge against declining affordability brought on by rising prices.

February 2020 by the numbers compared to a year ago

Sellers listed 5,293 properties on the market, a 19.9 percent increase from last February
Buyers signed 4,267 purchase agreements, up 23.9 percent (3,016 closed sales, up 6.0 percent)
Inventory levels declined 12.4 percent to 7,879 units
Months Supply of Inventory was down 11.1 percent to 1.6 months (5-6 months is balanced)
The Median Sales Price rose 6.3 percent to $282,000
Cumulative Days on Market decreased 2.9 percent to 67 days, on average (median of 40)
Changes in Sales activity varied by market segment

- Single family sales rose 4.9 percent;condo sales fell 1.4 percent; townhome sales rose 17.7 percent
- Traditional sales increased 6.9 percent; foreclosure sales rose 8.5 percent; short sales fell 5.9 percent
- Previously owned sales were up 6.3 percent; new construction sales climbed 16.8 percent

For more information on weekly and monthly housing numbers visit www.mplsrealtor.com.