listen to this articleThe state and the Twin Cities metro saw a roughly 20% increase in home listings in April, followed by a slight uptick in buyer activity, according to a report from the state and local Realtor associations.
The increase in listings brings the state's inventory level to just over 12,400 homes, or about 2.2 months of supply, according to a report released by Minnesota Realtors. The Twin Cities metro has an inventory of 7,700 homes, or just over two months' worth, according to a joint report by the Minneapolis Area Realtors and St. Paul Area Association of Realtors.
One thing the increased inventory means is that the spring market is approaching. There's one thing this doesn't mean. That means the purchase price is going down.
The median sales price in the Twin Cities metro was $385,250, up 4.1% from $369,900 last year. This time last year, the median home price across the state was $335,000, and now it's up 4.5% to $350,000.
Minnesota Realtors President Jeri Tice said in an interview Wednesday that she believes there are several reasons why prices continue to rise even as supply increases. As an example, Tice said interest rates have come down a bit and inventory remains somewhat depleted, so buyers need to bid high to get offers through.
“We don’t have enough inventory for the number of buyers,” she said. “We'll probably see a steady increase in inventory until it's in the four-to-six-month range.”
Tice said while it's difficult to read the market, he doesn't think prices will rise “that fast” based on national numbers, but prices will depend on several variables.
Theis said inventory levels in some parts of Minnesota's metropolitan area are approaching, if not in, the four-to-six-month range of the equilibrium market. The West Central region is at 3.7 months, according to a report from Minnesota Realtors. The Upper Minnesota Valley region is 3.4 months and the Northwest region is 4.1 months.
As for the Twin Cities metro, the report says the region would need about 20,000 active listings to become a balanced market.
MAR President Jamar Hardy said, “This is a market where both parties can be successful in meeting their own needs, but it may not be possible to meet all demands.'' “While it’s okay to be excited about increased inventory, people should know that there is still a lack of supply in the market, giving sellers an advantage.”
Single-family homes in the Twin Cities metro were priced at about $425,000, while condos and townhomes were priced at about $217,000 and $312,000, respectively.
Among pending sales across the region, condo sales increased 25.5% year over year. Single-family homes increased by 9.3% and townhomes increased by 1.2%.
Related:
Warm climate contributes to Twin Cities housing inventory
The number of new home listings in the Twin Cities metropolitan area increased by 34.5% compared to last year.
