(October 19, 2021) – According to new data from Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, buyers closed on 16.0 percent more homes in the Twin Cities metro area last month compared to September 2019. Sales were down 5.9 percent, however, from the heightened pace of September 2020. The trend still indicates rising demand, and suggests that much of last year was an outlier and unsustainable.
Both seller and buyer activity were down from 2020 but up from 2019. While the number of signed purchase agreements fell 14.4 percent compared to September 2020, the two-year growth from 5,047 purchase contracts in 2019 represents a 10.8 percent gain. That amounts to about 5.4 percent demand growth per year, a stable and healthy rate. Buyers remain active and persistent, though perhaps a bit more cautious. But because much of 2020 and 2021 are not apples-to-apples, year-over-year comparisons will continue to be distorted.
“We are still in a period where year-over-year comparisons can be skewed,” said Todd Walker, President of Minneapolis Area REALTORS®. “We’ve gone from March 3 to March 1—still a fast pace, but agents are seeing fewer multiple offers. Bypassed inspections and appraisal gap clauses are also less prevalent.” The metro area remains a firm seller’s market with just 1.5 months supply of inventory. That’s the lowest figure for any September going back two decades. Historically, five to six months of supply is considered a balanced market that doesn’t favor one side or the other—buyer or seller.
Seller activity declined 8.6 percent over the last year but rose slightly over the last two years. This is the region’s third consecutive year of September new listings exceeding 7,000, which hasn’t happened since 2007-2009. The median sales price for the metro rallied 10.2 percent from last year to $341,750. That’s shy of the $350,000 record high that held steady in June, July and August of this year. “While pricing remains firm, we’re at a time of year where activity typically slows down for the season,” according to Tracy Baglio, President of the Saint Paul Area Association of REALTORS®. “Even though we don’t quite see as fiercely competitive a market as last year or earlier this year, that doesn’t mean buyers suddenly have an upper hand, especially while sellers are still accepting offers over their list price and in record time.”
Activity varies by area, price point and property type. Home sales in Farmington rose 65.9 percent and in Golden Valley by 34.3 percent. Sales in Lino Lakes and Buffalo fell 51.7 percent and 48.3 percent respectively. Signed single family contracts fell 17.5 percent while condo agreements rose 10.4 percent. Sales of homes priced below $200,000 declined 33.6 percent while sales between $400,000 and $600,000 increased 22.2 percent compared to last year. Luxury home sales over $1M increased 7.0 percent from last September but are up 71.6 percent year-to-date.
September 2021 by the numbers compared to a year ago
- Sellers listed 7,238 properties on the market, an 8.6 percent decrease from last September
- Buyers signed 5,590 purchase agreements, down 14.4 percent (6,304 closed sales, down 5.9 percent)
- Inventory levels fell 15.6 percent to 8,306 units
- Month’s Supply of Inventory was down 21.1 percent to 1.5 months (4-6 months is balanced)
- The Median Sales Price rose 10.2 percent to $341,750
- Days on Market decreased 37.8 percent to 23 days, on average (median of 12 days, down 20.0 percent)
- Changes in Sales activity varied by market segment
- Condo & townhome sales fell 2.0 percent and 2.3 percent respectively, while single family home sales fell 6.0 percent
- Traditional sales were down 4.8 percent; foreclosure sales were down 60.9 percent; short sales fell 66.7 percent
- Previously owned sales dropped 4.2 percent; new construction sales decreased by 14.4 percent
(September 17, 2021) – According to new data from Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, listings throughout the Twin Cities sold quickly and often at or above list price. Though we remain undersupplied, there are signs of inventory stabilizing. The median sales price and price per square foot both increased.
Seller activity was down 3.6 percent while closed sales were up 0.6 percent. Pending sales—the number of signed purchase agreements—fell 10.3 percent from the frenzied pace of 2020 but remain above 2019 levels.
The 6,525 signed purchase agreements in August actually represent an 8.7 percent increase from August 2019. While we may struggle to reach the same level of demand from 2020, this upward trend in demand over two years confirms that buyer interest and activity remains strong. Median days on market fell 33.3 percent from last August to 10 days. This fast paced landscape where multiple offers remain common continues to push prices higher and allows some sellers to accept offers above their asking price.
“Even though these declines have moderated, incoming supply from new listings hasn’t changed much in recent years while, in fact, buyers have become more active,” said Todd Walker, President of Minneapolis Area REALTORS®. “Some of this arises from the fact that last year’s market was atypical and was shifted later into the year than a typical spring and summer market due to COVID.” The metro remains a seller’s market with just 1.4 months supply of inventory. Historically, six months of supply is considered a balanced market. That’s the lowest figure for any August going back to 2003.
The median sales prices remained at a record high of $350,000 for the third straight month. That’s an 11.1 percent increase compared to August 2020. Home prices have likely reached their seasonal peak for the year, but year-over-year increases compared to 2020 are likely to continue. Sellers are also receiving 102.4 percent of their list price, on average.
“Lately, home prices have increased more than the ability of some buyers to afford them,” according to Tracy Baglio, President of the Saint Paul Area Association of REALTORS®. “One silver lining is that average 30-year mortgage rates have remained historically low around 2.9 percent through most of the summer. Historically low-interest rates are helping ease the monthly payment of the higher home prices.”
Activity varies by area, price point and property type. Sales of condominiums were up 11.3 percent in Minneapolis and up 17.1 percent in St. Paul. Across the 16-county Twin Cities region new construction sales fell 24.1 percent while previously owned sales rose 3.7 percent. Single-family home sales in Eden Prairie rose 63.0 percent as did those in Cottage Grove by 23.3 percent. Single-family homes in Hudson and Otsego fell, 23.2 percent and 21.3 percent respectively.
August 2021 by the numbers compared to a year ago
• Sellers listed 7,644 properties on the market, a 3.6 percent decrease from last August
• Buyers signed 6,525 purchase agreements, down 10.3 percent (6,858 closed sales, up 0.6 percent)
• Inventory levels fell 20.1 percent to 7,686 units
• Month’s Supply of Inventory was down 26.3 percent to 1.3 months (4-6 months is balanced)
• The Median Sales Price rose 11.1 percent to $350,000
• Days on Market decreased 43.6 percent to 22 days, on average (median of 10 days, down 33.3 percent)
• Changes in Sales activity varied by market segment
- Condo sales rose 11.3 percent while single family & townhome sales were level with August 2020
- Traditional sales were up 1.9 percent; foreclosure sales were down 71.0 percent; short sales fell 53.3 percent
- Previously owned sales rose 3.8 percent; new construction sales dropped 24.1 percent.