Twin Cities housing market continues on trend of rising prices, low inventory

- The Twin Cities housing market is on track for another year of low inventory and high prices.

According to the Minneapolis Area Association of Realtors, the inventory of homes for sale in Minneapolis dropped by about 25 percent in February compared with a year earlier, while the median sale price rose by 7.6 percent.

“I think the perception of the good economy and fear that interest rates are going to go up later this year is really driving it,” said Herb Tousley of the Shenehon Center for Real Estate at the University of St. Thomas.

Tousley says while new home construction has picked up, higher list prices and mortgage rates have more people choosing to stay put rather than upgrade.

“I hear it all the time, ‘gosh, Dayna, I’d love to sell my house but I’m afraid I can’t find anywhere to go,’” said Twin Cities real estate agent Dayna Murray. “That’s a vicious circle.”

Murray says too many potential sellers are holding onto their homes, creating a lack of entry level inventory.

“Homes in this price range are gone in about 30 seconds,” said Murray as she showed us her latest sale, a two bedroom town home in St. Louis Park. “My team right now is averaging 12 days on market and that includes the inspection period.”

The Twin Cities market appears to fall in line with what realtors are seeing in most cities. In December, the number of homes for sale nationwide hit the lowest level since the National Association of Realtors began tracking such data in 1999.

“Last year it was really a seller’s market, and this year, it’s even more so,” said Tousley.


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