The last few months, housing market statistics in the Twin Cities have altered significantly. Every time factors change, the answers to the most pertinent real estate questions change too. Is Minneapolis now a buyer’s market? Is it favoring sellers? Who can afford a home there? Where should they look?
Whether you’re buying or selling, these are crucial questions with crucial answers. As the city keeps growing and housing trends keep adjusting, here are the top three things you need to know about Minneapolis real estate.
1. Nationally Recognized Growth
Last month we reported that housing inventory in Minneapolis continues to increase in year-over-year figures. As the economy has improved and home values soar, more homeowners have overcome negative equity, allowing them to sell. So older home listings have increased, but there’s another, more encouraging factor at play: new construction.
With the recession, markets all over the nation were dealt a hard blow to housing construction projects. Builders everywhere saw a huge decrease in contracts and permits, and in some cities they found no work at all. The recovery has improved most of these hard-hit housing markets, but new construction is often one of the last areas of improvement. It reveals a level of demand that has surpassed the supply of other listings, and it means the local economy is strong enough to support the creation of jobs that building requires.
Minneapolis real estate has reached that level of recovery, and the whole Twin Cities metro area has been recognized for its consistent inventory growth. Builders began work on 1,494 new homes in the second quarter of 2014. According to a recent report from MetroStudy, the greatest challenge Minnesota home builders face is a shortage of lots on which to build, but they remain optimistic. The city is seeing enough demand and economic stability to build whole neighborhoods of homes each year, so if you’re looking to buy a new home, you’re in luck. Minneapolis has thousands to choose from.
2. Home Sales Price Spikes
The number of home sales dipped a bit in Minneapolis in October—but just a bit. The Minneapolis Area Association of Realtors reported this week that home sales in the Twin Cities decreased 1.5% last month when compared to October 2013, but home prices have increased, substantially.
The average sale price of a home in the St. Paul-Minneapolis area jumped 6.7% over the past year, reaching $209,000. This marks the 32nd-straight increase in home prices, a long and sustained recovery for the housing market.
A lot of this is due to the tremendous decrease in foreclosures and short sale properties. Those listings were down 42.4% and 31.3%, respectively. With fewer underwater mortgages, fewer homeowners have to sell at a loss, which has led to a higher average in home prices and more market stability overall. This uptick, then, shouldn’t be alarming to homebuyers, especially if they didn’t plan to buy a foreclosed home or fixer upper. Higher home prices mean a strong and growing market, full of homes that will continue to appreciate over time.
3. Sustained Affordability
There shouldn’t be any huge concerns about affordability. The decrease in foreclosed and short sale properties might deter real estate investors, but every other kind of buyer can find a home in Minneapolis’ diverse housing inventory. After all, the city continues to attract millennial homebuyers for a reason. Despite the recent growth, and despite the recent price increases, the housing market as a whole remains accessible to most buyers. The array of Minneapolis neighborhoods and the many different sizes of homes listed offer options for everyone from first-time homebuyers to affluent retirees.
The Minneapolis Area Association of Realtors and Real Estate Matters just reported that the city has a large stock of moderately-priced homes for sale. Of course, anyone can find listings at either end of the price point spectrum, but that surplus of homes in the middle ground is what real estate agents (and many homebuyers) love to see. Home values are steadily increasing, but with so many neighborhoods and choices, listings in general remain firmly in the realm of affordability, welcoming buyers both young and old.
If you’re interested in purchasing one of the many Minneapolis homes for sale, or want to learn more about refinancing your current home by learning more about mortgage rates, simply fill out our Fast Response form or call our local branch at (952) 278-9900. Our experienced mortgage professionals would love to sit down and discuss your needs. We look forward to hearing from you!
Call the McPherson Sisters for more information today!