Has the Minnesota housing market reached its peak yet?
I’m going to talk about these stats for June for the entire state of Minnesota and I’m also going to touch on Anoka county, as I always do. So if you want to know what’s going on with this Minnesota Housing market stick around, let’s get started. if you are here for your dose of real estate, reality well, you’ve come to the right place.
My name is Brad Van Mill, I’M a local real estate agent serving the northern Minnesota area, and here on my blog, I talk about all things real estate and also about Minnesota.
Slowing Down Market?
Sorry, let’s talk about what happened in the month of Junefor the entire state of Minnesota and as always, i pull my data from Minnesota, realtors and it’s quite interesting folks. i think the market is definitely slowing down.
The Numbers
I’M going to share with you the numbers of what went on in not only the entire state, but also in Anoka county, and i want to share with you my opinion, my thoughts what’s going on here in the market, and why is everything the way it is Right now so for the month of June new listings, now for new listings in Minnesota, there were only 10 751 new listings that came on the market. That’s a 10.5 percent decrease from June of 21
I just want to share something with you, that’s very interesting!
So if you look back in may of this year, just a month prior in may of this year, there were only 10,269 new homes that came on the market and again compared that to the 10,751. That’s under 500 homes, less than 500 new homes came on the market.
In the month of June, closed sales were down as well closed sales. There was 7,812 compared to last year, which is 9,285
which is a 16 decrease in closed sales, but let’s talk about that median sales price. The median sales price was up 12 percent.
The median sales price in the entire state of Minnesota right now is five hundred and ten thousand dollars.
Yes, last June, the median sales price is four hundred and fifty five thousand dollars. Another interesting number is the percent of list price received for the month of June for the entire state of Minnesota. The percent of list price received from Minnesota was 105.1 percent, so homes are selling 5% above asking price, they’re still selling over ask now.
Another number I wanted to point out is the total number of homes for sale in the entire state of Minnesota, and I’m not talking about just new listings. I`m talking about everything that was active on the market in Minnesota for the month of June, that was down 17.8 from the prior year. There were only 18 145 homes for sale in Minnesota for the month of June.
Inventory is still an issue folks and I’m going to get into that in a minute. Let’s talk about Anoka county, really, quick, so Anoka county. Pretty much saw the same thing. That was that we’re seeing in the entire state total new listings inAnoka county for the month of June was 1068
That was a 13.3 percent decrease closed sales were down 14.
There were only 770 closed sales in Anoka county in June. Brace yourselves for this one. The median sales price for the month of June in Anoka county was 711 000. That’s an increase of eight point. Four percent – it’s getting quite expensive here in Anoka county, not going to lie the percent of list price received to burn county very similar to the entire state.
That number was a hundred and four point: seven percent, so homes were selling for 4 -7 percent higher than asking price so right in line with this with the entire state. So what the heck? What is going on? Did we reach our peak? i mean sales have slowed down and the inventory is not getting that much better.
All right are the prices coming down, no they’re not coming down, but the problem is there’s no inventory. So the reason we’re still seeing these prices remain high is because there’s no inventory now. if you watched a video, i did a couple of months ago. i’ll put it over here, you can check it out again. It’s talking about interest rates, stealing housing inventory.
What do i mean by that? if a person has an interest rate on their mortgage, that’s below four percent right now. Why are they gong to sell?
Okay, interest rates right now, they’re over five percent about five and a half percent, or so we were over six percent a few weeks ago when the feds raised the rates, but right now we’re still hovering in like the mid-five range, it’s not too terrible. But for those homeowners in Minnesota, fifty percent of homeowners have mortgages with interest rates below four percent.
What’s incentivizing them to leave to move to buy another house when they have to pay more money for a house and they’re going to pay a higher interest rate?
Why do they want to give that up? They don’t so. i think we’re going to continue seeing this problem here in jersey, where we’re going to have the low inventory because of the rising interest rates. Nobody wants to give that up and speaking from my own experience right now, i have new listings coming on in the next month or so and again, one of them is a second home.
it was an investment property that somebody now wants to offload the other ones. That i have sold so far this year were they’re moving out of state or it was an inheritance or again another investment property. That’S this is all i am seeing now. i have not gotten anybody to reach out to me say: hey! i want to trade up.
i want to downsize if or if they are downsizing they’re getting out of state they’re, not staying in Minnesota, because it’s getting so expensive. So look i hate to be the bearer of bad news, but this is the reality right now, just a couple days ago. it was declared we are now in a recession. So what does that mean? Are people going to be running out and wanting to sell their house right now and then is the buyer demand going to die off even more right?
Now it’s very possible it’s possible, but if the interest rates hang here around five and a half percent, we may just have a stagnant market for now. i don’t think it’s will, like i don’t think it’s will crash. You know i’m will tell you it’s not crashing. i don’t think we’re will see a boom again until, if we’re further into this recession and we get the inflation to calm down, then they’re going to lower the interest rates again. How long is that going to be?
i don’t know i don’t. Nobody knows i mean analysts are saying maybe another 12 months or so before things start to shake out. i don’t know, but what’s going on right now it this makes complete sense how these interest rates to higher interest rates have affected people who are thinking about selling.
They don’t want to give up their current interest rates, especially if they have below four percent and it or if you refinance in the last two years too, if you’ve gotten, like you know, in the threes or in some cases, below three percent, you refinance. What’s the motivation, why are you will, sell your house and give up that lower payment people aren’t will?
Do it did we peak? Did the market peak, i would say, as far as the inventory goes and yeah i mean, i think we reached that peak. A while ago, there’s still not much for sale, and i think that you know the price is coming down.
No, it’s getting more expensive, it’s getting more expensive because there is still a huge buyer demand out there. But if you are going to sell and you you have to sell for whatever reason be realistic about your price as agents right now, we have to watch this market like by the day to see what homes are closing at, because you can’t go in and say You know a house that sold three months ago went for fifty thousand over asking your house will probably go for over.
Asking is will be fifty thousand, maybe not, but be realistic about your price trust your real estate agent, and make sure that they are watching the market like on a daily basis, like what I’m doing like I’m like stalking, Minnesota, MLS every day.
i want to see what’s going on and what these houses are selling for, just in the past 30 days, because it definitely has changed. The prices are not as crazy high as they were a year ago. It’S calmed down, but they’re still going over. So if you’re will sell be realistic about the price and don’t get greedy trust me that’s going to bite you in the end.
Okay, that’s all i have today and if you want to read more about Minnesota and the housing market, you know check this out over here.
I highly recommend it and if you have any questions about Minnesota, real estate, you’re thinking about selling or buying, please feel free to reach out to me my contact information is down below in that description box. Thank you so much for reading my article today. I’M Brad Van Mill with Fish MLS realty, and i will see you next time.
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