tariff effects on New Construction

Realtor Reviews Minneapolis Housing Market

Twin Cities 2019 Housing Market Forecast Realtor Reviews Minneapolis Housing Market

The 2018 housing market has sure been a wild ride. The year began with rapidly rising home prices and low mortgage interest rates. Bidding wars were the norm for highly desirable homes. It was not unusual for sellers to find a buyer in the first few days after putting their house up for sale, generally at the total asking price or even above. Sellers were riding high while buyers struggled to close a deal on a home.

But in the last few months of the year, we begin to see a shift in the market. Prices are finally stabilizing or increasing at a slower pace. Interest rates reach 5.2 percent, an 8-year high. Now rates have fallen back to 4.59 as a benchmark for a 30-year fixed-rate mortgage. The market still favors sellers but to a lesser degree.

2017 compared to 2018

  • new listings down -0.3%
  • pending sales down -3.6%
  • closed sales down -3.4%
  • overall median sales price up +7.7%

Now what you have all been waiting to hear. What are the takeaways for the 2019 market?

The Economy

The economy right now is still vibrant but showing signs of moderating. Everything that happens in the future will hinge on the trade war.

If the US and China reach a trade agreement by March, that should send the stock market soaring and consumer confidence along with it. However, if the trade war continues and the tariffs become even more punitive, that will own the world economy and the US along with it.

Now you might ask, why do we care, and how does China affect the housing market?  It’s about interest rates...

August 2018 Twin Cities Housing Snapshot

Centennial Lake Park August 2018 Housing Stats

The Minneapolis-St Paul Housing Market Overview

As we look at the end of the summer real estate season, things have not changed very much. We see new listings up 7.6 percent over August of last year, which is a bright spot. However, for first-time home buyers, the story is still one of the limited housing choices facing continued strong demand. The situation when we look at listings under $300,000 is still critical regarding supply. The higher we go up the price tiers, the more balance we see. Properties priced from $500,000 up to $1,000,000, offer a more balanced market in which buyers have more options compared to the over $1,000,000, strata, which is a buyers market.

Looking deeper into the data gives us some reason to be optimistic but cautiously so. Even though we saw an increase in new listings, inventory levels fell 8 percent from last year. Pending sales were down 2.9 percent and closed sales ticked slightly upward at 0.2 percent over the same time last year. Home values continue to move upward to the tune of 6.3 percent while spending less time on the market. Buyers at the lower price range are making full price offers or engage in bidding wars to close a deal.   

New Construction in the Mpls St...