Twin Cities Housing Market Sees More Sales But Lower Inventory In February

Twin Cities Housing Market Sees More Sales But Lower Inventory In February

Sales rose nearly 7 percent despite a roughly 20 percent drop in active properties.

An influx of buyer and seller activity in the Twin Cities housing market last February led to higher sales prices but an “all-too-familiar supply crunch” with the number of active properties slipping by nearly 20 percent from a year ago.
 
With fewer options to buy from, sellers are accepting offers closer to their list price, the Minneapolis Area Association of Realtors (MAAR) said. Homes remained on the market for an average of 96 days with sellers receiving 95.3 percent of their original list price. Single-family homes rounded out (once again) as the top selling type of home, although townhomes had the strongest sales volume increase of the 12 months.
 
February pending sales rose 6.7 percent and the median price for a home—now at $207,395—grew 3.7 percent from a year ago.
 
“This spring market will be a telling one for a number of reasons,” MAAR president Judy Shields said in a statement. “Many would-be buyers are waiting on sellers. Early indicators such as mortgage applications suggest demand is only likely to strengthen. The uncertainty comes on the supply side, but there’s a good chance we’ll see more inventory this year.”
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Despite a 3 percent jump in new listings, inventory levels falling 19.4 percent to less than 11,000 total listings have hampered negotiation abilities for buyers, particularly first-time home buyers. Moreover, 

residential construction of new homes in the Twin Cities hit a two-year low last month.

With encouraging wage growth, the state’s low unemployment rate, and mortgage interest rates below 4 percent, realtors believe the metro’s market is settling back to where it was before the housing crash.
 
“Buyers appear ready for another blockbuster year,” MAAR president-elect Cotty Lowry said in a statement. “[This puts] the charge on sellers to meet all this demand.”