If you are doing research on the local housing market in the Twin Cities, you may be finding it tough to find accurate information that isnt someone trying to blow smoke or a media outlet that is trying to make you scared out of your mind about a pending market crash.
Well I have good news for you - this blog is purely based on local Twin Cities data from the month of November that is honest and to the point. No smoke, no fear, just info.
My name is Bailey Beckman. I am a local Twin Cities resident and also a residential real estate expert. Make sure that you subscribe to my YouTube Channel and click that notification bell to be the first to know about changes in the Twin Cities market.
It might not come as a surprise to you, but November is one of the first months of the off-season here in the Twin Cities housing market. When looking at data, it is extremely important to look at annual trends to show seasonal changes (the good & expected ones) but also other changes that may be highlighting real large scale adjustments.
Median Home Sales Price - $354,000
This graph shows the median home sales prices over the last 10 years. The black dots represent the month of January in every year. There is a very clear pattern here with the valley of each season bottoming out in the winter months. The final red dot here on the chart represents the month of November this year, showing the seasonal downwards trend.
The median sales price was at $354,000 in the Twin Cities, which is up 4.1% compared to last year.
Percent of Original List price - 98.3%
But what you may find interesting is that even though the sales price is up compared to last year, offer prices are DOWN. This graph shows the median percent of the list price of homes here in the Twin Cities. So if the percentage is 100 and a home is listed at say $300,000, the sellers accepted an offer at $300,000. This month we actually saw a dip in the percentage down to 98.3%... Something that we havent seen since January of 2020.
So what the heck does that mean?! Sellers are listing their homes for more than what buyers are willing to offer. Going into this winter, it is extremely important to price your home accurately so that it doesnt sit on the market. It is good news for buyers that there is a temporary break in the $20,000 above asking offers.
New Listings vs. total inventory
We also see less new homes listed in the off-season. Here you can see that the least amount of new homes added into the market over the last five years is the month of December. So we are gearing up for that dip in the data again this year. We did see a 17% decrease in the number of new listings compared to November of last year, BUT if you pull the overall inventory of homes available we are actually up 12.6% compared to last year. What this means is that there are more total homes for buyers to choose from, which decreases the pressure on the supply and reduces demand.
Days on market - 24 days
Lower demand, also means longer days on market. In the month of November we were up to 24 days, again expected as we head into the off-season. This year does feel different though because we were only at a median of 16 days last year, signifying that our market is balancing itself back out. We are not in a full scale plummet like the media has been selling. You can see here that our days on market are on par with peak seasons prior to the pandemic.
interest rates - ~6.6% (30yr fixed rate mortgage)
So we are seeing a delicate balance here in the Twin Cities with supply and demand meeting each other a little better than this spring. Most of this is seasonal change, but there was also a forced slow down with increased interest rates as the fed battled with inflation. Rates hovered right around 6.6% for a 30 year fixed rate loan in the month of November and they are expected to remain in the low to mid sixes until this sprin.
No smoke, no fear, just info.
Yes the market has cooled but so has the weather.
We are heading into the off-season as people hunker down and wait for spring. But for some of you this may be the perfect time to purchase a home. Check out my video Now is the Perfect Opportunity to Buy for 4 reasons why now might be the time for you to pull the lever and start your ownership journey.