It took almost a decade, but it looks as if 2016 may finally be the year that the Twin Cities real estate market gets back to normal. Currently, the market for Twin Cities real estate is growing, and experts agree that this trend looks as if it will continue throughout the year. Although home inventories are low, listings grew by ½ percent over the past month. According to the Minneapolis Area of Association of REALTORS, pending sales are also on the rise. Last month depicted a 12.6 percent increase in pending sales. In fact, Twin Cities saw values grow too. Home values have seen a 5 percent per square foot hike and 5.7 percent increase in median sales prices over last year.
So, what does all of this mean for a Minneapolis or St. Paul homeowner? Well, it depends. The good news, the market is healthy and looks as if it will continue to grow throughout 2016. Sellers are having an easy time selling homes and finding values that are positive. The more challenging situation in this market are low inventory levels. As historic low interest rates help potential homeowners make their way into the housing market, homes are being purchased at a rapid rate. Furthermore, employment levels are positive within the Twin Cities region, which also helps move the market upward. However, if you are looking to purchase a home, you may have to wait a bit longer to find the home of your dreams. As mentioned earlier, low interest rates are very attractive to buyers, and more home buyers are entering the market. So, the low inventory is making it a bit harder to find that perfect home.
Over the past several months, home supplies were down 28.6 percent. This low supply is causing the 5.7 percent bump in pricing. Although, this increase is still within healthy limits and appears to be a basic supply and demand matter. First time buyers may be burdened a bit with having to look a little longer to find a suitable home, but they will still be taking advantage of lower rates. Homeowners who are looking to upgrade may have to think about a backup plan though. Since homes are selling fast, many sellers are finding themselves without a new house to call home.
Housing priced at $300,000 or under are the homes affected by the low inventory situation. For buyers who are looking to upgrade above $300,000, there are more choices. As spring and summer continue, more Twin Cities real estate will become available. Plus, growth rates are still expected to increase at a healthy rate. So, if you have been thinking about selling or buying, it’s currently a great time to start looking.