“Buyer competition is frequently manifesting quick sales above asking price.”
Sellers: flat. Buyers: down. Prices: up.
By David Arbit on Wednesday, July 18th, 2018
Seller activity was relatively flat in June while buyers pulled back somewhat. For the first time since 2010, new listings surpassed 9,000 in May of this year. That’s encouraging, even though June seller activity was down slightly compared to last year. Increasing or steady seller activity combined with a cool down in demand is consistent with a loosening marketplace. That said, buyers shopping this spring and summer will still face stiff competition. While sellers are receiving full-price-or-better offers in record time, listings still need to show well and be priced properly. June marked the seventh consecutive month of year-over-year declines in closed sales, likely reflecting the shortage of homes for sale.
Strong demand and low supply means sellers yielded an average of 100.3 percent of their list price in June, a record high for any month since at least the beginning of 2003. The shortage is especially noticeable at the entry-level prices, where multiple offers and homes selling for over list price have become increasingly common.
The move-up and upper-bracket segments are less competitive and better supplied. Yes, the housing market is tight out there—sometimes frustratingly so. But over 54,000 Twin Cities buyers and sellers have managed to successfully transact real property so far this year.
June 2018 by the Numbers (compared to a year ago)
Sellers listed 8,730 properties on the market, a 1.2 percent decrease
Buyers closed on 7,063 homes, a 8.1 percent decrease
Inventory levels for June fell 15.9 percent compared to 2017 to 11,374 units
Months Supply of Inventory was down 14.8 percent to 2.3 months
The Median Sales Price rose 5.7 percent to $271,900, a record high
Cumulative Days on Market declined 14.6 percent to 41 days, on average (median of 16)
Changes in Sales activity varied by market segment
Single family sales sank 7.1 percent; condo sales rose 8.4 percent; townhome sales declined 13.7 percent
Traditional sales fell 6.6 percent; foreclosure sales sank 39.3 percent; short sales dropped 39.0 percent
Previously-owned sales fell 7.4 percent; new construction sales decreased 4.3 percent
Weekly Market Report
For Week Ending July 7, 2018
As prices persistently rise and months of supply decrease in year-over-year comparisons, it continues to be an ideal time for more sellers to enter the market. Across the U.S., inventory levels are still lagging behind last year, but new listings have perked up nicely so far this year. This has been coupled with many announced new home-building projects across the nation and a more positive tone from the building community.
In the Twin Cities region, for the week ending July 7:
- New Listings decreased 14.6% to 1,192
- Pending Sales decreased 10.6% to 1,018
- Inventory decreased 14.6% to 11,344
For the month of June:
- Median Sales Price increased 5.3% to $271,000
- Days on Market decreased 16.7% to 40
- Percent of Original List Price Received increased 0.8% to 100.3%
- Months Supply of Inventory decreased 14.8% to 2.3
All comparisons are to 2017
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
Weekly Market Report
For Week Ending June 30, 2018
The unemployment rate rose to 4.0 percent in June 2018, marking the first increase in nearly a year. Economic forecasters are calling this a healthy increase indicative of more people being counted as entering the work force in an exceptional job market that added more than 213,000 paying jobs in June. Strong demand for workers combined with low supply creates upward pressure on wages. Employed people with higher wages are generally good for residential real estate.
In the Twin Cities region, for the week ending June 30:
- New Listings increased 15.1% to 1,864
- Pending Sales increased 1.1% to 1,519
- Inventory decreased 16.5% to 11,374
For the month of May:
- Median Sales Price increased 8.3% to $270,750
- Days on Market decreased 9.6% to 47
- Percent of Original List Price Received increased 0.7% to 100.2%
- Months Supply of Inventory decreased 12.0% to 2.2
All comparisons are to 2017
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
Weekly Market Report
For Week Ending September 17, 2016
As temperatures start to cool throughout the country, the total number of home sales will cool as well, as is the seasonal nature of the housing market. But with household incomes on the rise within a healthy job market, that doesn’t necessarily equate to a downward year-over-year trend. Continuing supply restrictions will certainly have an effect on numbers that may otherwise obviously point toward sunny day real estate.
In the Twin Cities region, for the week ending September 17:
- New Listings decreased 0.9% to 1,603
- Pending Sales decreased 1.5% to 1,079
- Inventory decreased 17.3% to 14,177
For the month of August:
- Median Sales Price increased 5.6% to $237,500
- Days on Market decreased 14.1% to 55
- Percent of Original List Price Received increased 0.8% to 97.9%
- Months Supply of Inventory decreased 21.6% to 2.9
All comparisons are to 2015
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
September Monthly Skinny Video
Weekly Market Report
For Week Ending September 10, 2016
During a point in time when record-low mortgage rates should be coercing new home buyers into the market, many potential first-time buyers are seemingly not able to afford what is on the market. As labor costs and demand grow, and as a construction labor shortage continues, builders tend toward building more expensive homes, creating a tight supply of entry-level homes. Not all situations match this scenario, but it is certainly an interesting time in the residential real estate marketplace.
In the Twin Cities region, for the week ending September 10:
- New Listings increased 11.0% to 1,722
- Pending Sales decreased 2.0% to 954
- Inventory decreased 17.4% to 14,011
For the month of August:
- Median Sales Price increased 5.6% to $237,500
- Days on Market decreased 14.1% to 55
- Percent of Original List Price Received increased 0.8% to 97.9%
- Months Supply of Inventory decreased 24.3% to 2.8
All comparisons are to 2015
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
August activity strong with growth in sales and listings
By Aubray Erhardt on Wednesday, September 14th, 2016
Seller activity increased 2.1 percent since last August, as sellers introduced 7,072 new listings to the marketplace. Buyer activity also rallied. Pending sales rose 7.9 percent while closed sales gained 7.4 percent. To fuel those gains, buyers signed 5,728 new contracts and closed on 6,382 homes. That closed sales figure is on par with 2004 levels. Although the median sales price has reached its seasonal peak for 2016, it increased 5.7 percent since August 2015 to $237,750. Adding to the pressure facing buyers, inventory levels fell 18.8 percent to 13,933 active properties. Inventory constraints haven’t slowed down buyers yet, but additional listings are needed to ease the contentious landscape.
Low inventory has enabled homes to sell in near record time. Average days on market until sale fell 14.1 percent to 55 days. That’s the second fastest market time for any month since the beginning of 2007. The average percent of original list price received at sale was 97.9 percent, the highest figure for any August since 2005. Months supply of inventory fell 24.3 percent to 2.8 months—the lowest August figure on record since the beginning of 2003. Generally, five to six months of supply is considered a balanced market. This indicator measures the balance between supply and demand in the marketplace.
“Absorption rates under 3.0 months suggests things are still pretty tight out there as we transition to autumn,” said Judy Shields, Minneapolis Area Association of REALTORS® (MAAR) President. “But there are still peculiarities across locations and segments. Blaine is not Linden Hills and downtown condos are not suburban single family new construction. It’s important to have all the facts before making a move.”
Despite the fact that both seller and buyer activity increased in August, important asymmetries persist. Over the last three years, buyer activity has steadily marched higher while seller activity has essentially bounced around the 7,000 unit marker, thus straining supply levels.
A strong Twin Cities labor market has also helped promote housing recovery. The most recent national unemployment rate is 4.9 percent, though it’s a healthier 3.5 percent locally. The Minneapolis-St. Paul-Bloomington metropolitan area has the second lowest unemployment rate of any major metro area, trailing only Denver by 0.1 percent.
Locally, the 30-year fixed mortgage rate stands at 3.47 percent compared to a long-term average of about 8.0 percent. Rates are now at their lowest level in three years. Marginally higher rates were widely expected in 2016, but the Federal Reserve hasn’t made a move since last December. Markets currently peg the odds of a September rate hike at around 20.0 percent. Barring any surprising economic data, the Fed will likely raise rates this December.
“In the near term, buyer and seller activity always quiets down around this time of year and that shouldn’t cause concern,” said Cotty Lowry, MAAR President-Elect. “Over the long term, favorable interest rates, rising rents and a strong labor market should be conducive to housing. But we’ll need some additional inventory—particularly in the affordable brackets—in order to keep up with consumer demand.”
Weekly Market Report
For Week Ending September 3, 2016
Most market trends have been steadily the same for the bulk of 2016, and there’s not much reason to expect a change as we enter the last several months of the year. We have witnessed an overall drop in the number of days a home is on the market before sale, that sale price is generally higher than it used to be and there are fewer homes for sale. The one area of interest that we will be watching will be total sales being made. As the drop in inventory continues, it stands to reason that there will be fewer sales, but that has yet to consistently be the case.
In the Twin Cities region, for the week ending September 3:
- New Listings decreased 8.6% to 1,314
- Pending Sales decreased 6.9% to 1,114
- Inventory decreased 16.7% to 14,295
For the month of August:
- Median Sales Price increased 5.6% to $237,500
- Days on Market decreased 14.1% to 55
- Percent of Original List Price Received increased 0.8% to 97.9%
- Months Supply of Inventory decreased 24.3% to 2.8
All comparisons are to 2015
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
Weekly Market Report
For Week Ending August 27, 2016
If residential real estate were a wager to close out the summer golf season, prospective buyers would still be waiting impatiently for prospective sellers to take the putt on the final hole. Yet inventory continues to shrink, as summer vacations end and kids return to school. If the taken putt were to somehow land in the cup and increase inventory, a legendary celebration would occur that might even make a golf course gopher dance.
In the Twin Cities region, for the week ending August 27:
- New Listings decreased 8.0% to 1,411
- Pending Sales increased 0.3% to 1,174
- Inventory decreased 17.0% to 14,454
For the month of July:
- Median Sales Price increased 6.6% to $239,900
- Days on Market decreased 14.3% to 54
- Percent of Original List Price Received increased 0.8% to 98.4%
- Months Supply of Inventory decreased 21.1% to 3.0
All comparisons are to 2015
Click here for the full Weekly Market Activity Report. From The Skinny Blog.
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