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.

Weekly Market Report

For Week Ending October 10, 2020

According to a National Association of Home Builders analysis of Census Bureau data, the lot size of new construction homes is getting smaller. The median lot size for single-family homes sold in 2019 was 8,177 square feet, or .188 acres, its smallest on record. While lot sizes vary by region due to population density, the availability of land, and local regulations, shrinking lot sizes is one way to help partially offset the increasing costs of building a new home.

In the Twin Cities region, for the week ending October 10:

  • New Listings increased 12.4% to 1,705
  • Pending Sales increased 25.2% to 1,375
  • Inventory decreased 30.2% to 9,091

For the month of September:

  • Median Sales Price increased 10.8% to $310,000
  • Days on Market decreased 15.9% to 37
  • Percent of Original List Price Received increased 2.0% to 100.5%
  • Months Supply of Homes For Sale decreased 33.3% to 1.8

All comparisons are to 2019

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.

Mortgage Rates Drop, Hitting Another All-Time Low

October 15, 2020
Low mortgage rates have become a regular occurrence in the current environment. As we hit yet another record low, the tenth record this year, many people are benefitting as refinance activity remains strong. However, it’s important to remember that not all people are able to take advantage of low rates given the effects of the pandemic.

Information provided by Freddie Mac.

Weekly Market Report

For Week Ending October 3, 2020

As the weather continues to cool, real estate activity slowly cools along with it. While buyer activity is following its normal seasonal trend lower, it remains substantially higher than the same time last year, continuing a months-long trend. Strong buyer demand continues to draw down the available inventory of homes for sale at a rapid pace, leaving buyers with fewer homes to choose from and many sellers with multiple offers.

In the Twin Cities region, for the week ending October 3:

  • New Listings increased 10.4% to 1,702
  • Pending Sales increased 19.1% to 1,493
  • Inventory decreased 29.7% to 9,234

For the month of August:

  • Median Sales Price increased 9.8% to $315,000
  • Days on Market decreased 4.9% to 39
  • Percent of Original List Price Received increased 1.3% to 100.3%
  • Months Supply of Homes For Sale decreased 30.8% to 1.8

All comparisons are to 2019

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.

Mortgage Rates Remain Flat

October 8, 2020
The year-long slide in mortgage rates seems to be ending as rates have flattened over the last month and the economic rebound has slowed. But with near record low rates, buyer demand remains robust with strong first-time buyers coming into the market. The demand is particularly strong in more affordable regions of the country such as the Midwest, where home prices are accelerating at the highest rates over the last two decades.

Information provided by Freddie Mac.