Despite strong buyer demand, sales totals are lower due to a lack of affordable supply
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Weekly Market Report
For Week Ending July 20, 2019
Residential real estate markets across the nation have been performing quite well at this point in the year in terms of home sales, price and inventory. Although not always true at every price point and home type in every geography, the general rule of thumb in 2019 as we stretch beyond the halfway point of the year has been a trend of relative market balance, which is a great thing for both real estate professionals and consumers.
In the Twin Cities region, for the week ending July 20:
- New Listings decreased 2.4% to 1,883
- Pending Sales decreased 3.6% to 1,342
- Inventory decreased 2.8% to 12,005
For the month of June:
- Median Sales Price increased 7.2% to $290,000
- Days on Market increased 2.5% to 41
- Percent of Original List Price Received decreased 0.3% to 100.0%
- Months Supply of Homes For Sale increased 4.0% to 2.6
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
Weekly Market Report
For Week Ending July 13, 2019
Every year during the week of Independence Day, real estate markets across the country slow down as buyers, sellers and real estate professionals take some time off during the height of summer to spend time with friends and family. This year continued that tradition, except that new listings declined a little more and pending sales rose a little more. This is of particular interest because that is the exact dynamic that will keep prices on the rise.
In the Twin Cities region, for the week ending July 13:
- New Listings increased 0.5% to 2,227
- Pending Sales increased 0.3% to 1,470
- Inventory decreased 2.1% to 11,759
For the month of June:
- Median Sales Price increased 7.2% to $290,000
- Days on Market increased 2.5% to 41
- Percent of Original List Price Received decreased 0.3% to 100.0%
- Months Supply of Homes For Sale remained flat at 2.5
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
Some mixed signals but market fundamentals remain intact
July 18, 2019
In the face of mixed signals, assessing market health can be a challenge. The economy remains healthy, mortgage rates are outrageously low and yet sales aren’t rising. That’s in part because we simply haven’t built enough homes to keep pace with the demand. Despite attractive mortgage rates, the supply of available homes is so tight that sales are struggling to keep pace. Rising home prices typically incentivize more sellers to list. But with nowhere to go because of the shortage, listing activity is down. New construction has been hampered by rising land, labor and material prices as well as regulation, forcing builders to create new supply in the high-end luxury market often at the expense of more affordable entry-level product. But the demand from millennials (and some baby boomers) is concentrated in the affordable price points, creating multiple-offers and frustrated buyers.
But it’s that tight inventory that’s still driving prices higher. Sales prices reached a new all-time high of $290,000 in June—likely our high for the year. New listings stumbled 3.1 percent while pending sales were down 2.9 percent. Days on market remained flat compared to June 2018 while the ratio of sold to list price fell for a fifth consecutive month. In some ways, the market is improving for buyers, even though sellers are still enjoying strong pricing power, favorable negotiating leverage and quick market times. For the last nine months, buyers have seen more active listings for sale than the year prior. We still have a tale of two markets: strong demand, weak supply and price growth in the affordable brackets compared to a slight oversupply, slow market times and weaker pricing in the upper brackets.
June 2019 by the Numbers (compared to a year ago)
- Sellers listed 8,473 properties on the market, a 3.1 percent decrease from last June
- Buyers closed on 6,604 homes, an 8.2 percent decline
- Inventory levels decreased 1.3 percent from last June to 12,063 units
- Months Supply of Inventory was flat at5 months
- The Median Sales Price rose 7.2 percent to $290,000, a record high for any month
- Cumulative Days on Market remained stable at 40 days, on average (median of 16)
- Changes in Sales activity varied by market segment
- Single family sales fell 7.5 percent; condo sales fell 13.3 percent; townhome sales decreased 6.1 percent
- Traditional sales declined 6.8 percent; foreclosure sales dropped 46.4 percent; short sales fell 48.1 percent
- Previously owned sales were down 8.1 percent; new construction sales rose 2.0 percent
Quotables
“The market is quiet right now, not every month shows significant change. Inventory is low, buyer demand is still evident and interest rates are phenomenal,” said Todd Urbanski, President of Minneapolis Area REALTORS®. “The untold story is the increase in net worth for homeowners. Rising prices mean rising equity. It can be a challenge to find a home, but homeownership is the best avenue to wealth-building.”
“The idea of the ‘housing market’ as a singular entity can be misleading,” said Linda Rogers, President-Elect of Minneapolis Area REALTORS®. “Cities, neighborhoods and different segments can often show tremendous variation.”
From The Skinny Blog.
Weekly Market Report
For Week Ending July 6, 2019
The order of the day is market balance between buyer and seller interests. While true that there may not be as many homes for sale to choose from and that prices are on the high end for the average first-time home buyer, there are considerations for sellers as well. Such as, more markets are swinging toward the back side of balance with fewer sales leading to some amount of downward price pressure from a beleaguered buyer core that is becoming less willing to overreach.
In the Twin Cities region, for the week ending July 6:
- New Listings decreased 16.0% to 1,006
- Pending Sales increased 11.5% to 1,187
- Inventory increased to 12,074
For the month of June:
- Median Sales Price increased 7.2% to $290,000
- Days on Market increased 2.5% to 41
- Percent of Original List Price Received decreased 0.3% to 100.0%
- Months Supply of Homes For Sale remained flat at 2.5
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
Weekly Market Report
For Week Ending June 29, 2019
The summer selling season is progressing with plenty of buying and selling activity thus far, thanks to a healthy economy that has consumers willing to spend their hard-earned money on the things they desire, even if it’s more expensive than it was a few years ago. This has proven to be true in several sectors, whether retail, travel or even housing, the most expensive purchase most people will ever make in their lives.
In the Twin Cities region, for the week ending June 29:
- New Listings increased 0.4% to 1,878
- Pending Sales decreased 5.0% to 1,498
- Inventory decreased 0.3% to 12,083
For the month of May:
- Median Sales Price increased 5.2% to $285,000
- Days on Market decreased 4.3% to 45
- Percent of Original List Price Received decreased 0.2% to 100.0%
- Months Supply of Homes For Sale increased 4.3% to 2.4
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
Weekly Market Report
For Week Ending June 22, 2019
Persistently low mortgage rates and slower price increases have combined with economic growth, low unemployment, wage improvement and consumer confidence to keep home buyers in the market, despite insufficient supply. Builders have not made enough new homes for several years, and, thus, national housing inventory is extremely tight. The vacancy rate for owner-occupied homes in 2018 was the lowest since 1995. If the economy begins to slow, this situation is unlikely to improve.
In the Twin Cities region, for the week ending June 22:
- New Listings increased 1.9% to 2,028
- Pending Sales increased 1.2% to 1,494
- Inventory increased 1.1% to 12,008
For the month of May:
- Median Sales Price increased 5.2% to $285,000
- Days on Market decreased 4.3% to 45
- Percent of Original List Price Received decreased 0.2% to 100.0%
- Months Supply of Homes For Sale increased 4.3% to 2.4
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
May Monthly Skinny Video
“While perhaps we won’t match the growth in the market seen over the last few years, stability and sustainability are the primary objectives.”
Weekly Market Report
For Week Ending June 15, 2019
As anticipated, the Federal Reserve did not change the target range for the federal funds rate (currently set at 2.25% to 2.5%) during their most recent meeting, but the door was left open for a possible rate reduction in 2019 following a string of increases over the last several years. Although the economy is still performing well due to low unemployment and solid retail sales, trade tensions, slowed manufacturing and meek business investments have created uncertainty.
In the Twin Cities region, for the week ending June 15:
- New Listings remained flat at 2,069
- Pending Sales decreased 2.0% to 1,463
- Inventory increased 1.0% to 11,687
For the month of May:
- Median Sales Price increased 5.2% to $285,000
- Days on Market decreased 4.3% to 45
- Percent of Original List Price Received decreased 0.2% to 100.0%
- Months Supply of Homes For Sale increased 4.3% to 2.4
All comparisons are to 2018
Click here for the full Weekly Market Activity Report. From MAAR Market Data News.
Early 2019 Weakness Proving Temporary; Market Back On Track
June 18, 2019
There have been two disruptions to the housing market over the last nine months, but their effects are proving short-lived. First, a sudden increase in interest rates in late 2018 weighed on December and January sales activity. Second, record snow and the subsequent melt in February and March of this year weighed on sales activity in March and April. But May numbers are showing growth in seller activity, pending and closed buyer activity as well as quicker market times and rising prices.
Prices reached a new all-time high of $285,000. New listings rose 2.4 percent while closed sales were up 3.0 percent. After two months of increases, market times sped up by 4.3 percent compared to May 2018. The ratio of sold to list price fell for a fourth consecutive month, but by the smallest amount since February. In conjunction with other indicators, the market is improving for buyers, even though sellers still enjoy strong pricing power, favorable negotiating leverage and quick market times. For the last nine months, buyers have seen more active listings for sale than the year prior. Mortgage rates remain very attractive at around 3.85 percent on a 30-year fixed loan—far lower than anyone predicted by this time. We still have a tale of two markets: strong demand, weak supply and price growth in the affordable brackets but oversupply and slow market times in the upper brackets.
May 2019 by the Numbers (compared to a year ago)
- Sellers listed 9,402 properties on the market, a 2.4 percent increase from last May
- Buyers closed on 6,000 homes, a 3.0 percent increase
- Inventory levels for May increased 0.5 percent compared to 2018 to 11,327 units
- Months Supply of Inventory was flat at 3 months
- The Median Sales Price rose 5.2 percent to $285,000, a record high for any month
- Cumulative Days on Market decreased 4.3 percent to 45 days, on average (median of 17)
- Changes in Sales activity varied by market segment
- Single family sales rose 2.7 percent; condo sales rallied 9.9 percent; townhome sales increased 3.1 percent
- Traditional sales increased 4.4 percent; foreclosure sales declined 26.8 percent; short sales fell 28.6 percent
- Previously-owned sales were up 2.9 percent; new construction sales surged 10.5 percent
Quotables
“We’re still seeing some rebalancing, but it just isn’t as dire as some want us to believe,” said Todd Urbanski, President of Minneapolis Area REALTORS®. “Rates under 4.0 percent is a significant motivator for buyers.”
“Not everyone understands that all real estate is local,” said Linda Rogers, President-Elect of Minneapolis Area REALTORS®. “Shifts in other regions have very little impact on our local market dynamics.”
From The Skinny Blog.