Archives for January 2021

Despite the headwinds, 2020 was a record-breaking year for housing

(January 26, 2021) – According to the 2020 annual report from the Minneapolis Area REALTORS® and the Saint Paul Area Association of REALTORS®, both buyer and seller activity in the 16-county Twin Cities metro last year outpaced 2019 levels. After a brief pullback following the onset of the pandemic—and aided by remote work, distance learning, historically low rates and a desire for more space—market activity recovered quickly and ended the year posting several new records across various metrics.

Seller activity rose a modest 0.1 percent from 2019 while closed sales were up 7.7 percent. That marks the highest sales figure since at least 2003 and the highest new listings count since 2016. Listing activity was constrained due to health concerns, remodeling activity, a lack of options and homeowners staying in their homes longer.

“Predictably, the result of record sales combined with ultra-low inventory meant rising prices and sellers accepting stronger offers in less time,” according to Tracy Baglio, President of the Saint Paul Area Association of REALTORS®.

Governor Walz’s shelter-in-place order paused market activity in April and May, which created pent-up demand that pushed the spring market into summer and the summer market into fall. Buyers were still more eager to purchase than sellers were to list, meaning multiple offers remained commonplace—particularly at the more affordable price points where the inventory shortage is even more pronounced.

“Despite several challenges, the Twin Cities housing market exceeded all expectations,” said Todd Walker, President of Minneapolis Area REALTORS®. “Inventory remained a hurdle, but homeowners have never had so much equity in their homes and buyers haven’t seen rates this low in 50 years, offsetting rising prices.”

The median sales price rose 8.9 percent to $305,000, a record high. On average, sellers obtained 99.8 percent of their list price—the highest since at least 2003. Homes sold quickly. Half the sales had accepted offers in under 18 days. Importantly, all areas, price points and property types are unique.

Signed contracts rose 10.0 percent in Minneapolis and 16.4 percent in St. Paul, suggesting core cities remain attractive. With prices slightly lower, market times higher and offers weaker, the condo market continues to lag other segments. Aided by favorable jumbo rates and a recovered stock market, sales of luxury properties ($1M+) have been soaring higher—up 25.4 percent from 2019.

One thing is clear: the housing market continues to outperform, despite several headwinds.

2020 by the numbers (compared to 2019)

Sellers listed 76,348 properties on the market, a 0.1 percent increase from 2019
Buyers closed on 64,479 properties, up 7.7 percent (65,770 pending sales, up 9.7 percent)
• The Median Sales Price rose 8.9 percent to $305,000
Inventory levels fell 39.3 percent to 5,080 units
Months Supply of Inventory was down 47.1 percent to 0.9 months (5-6 months is balanced)
Days on Market decreased 12.2 percent to 43 days, on average (median of 18, down 21.7 percent)
• Changes in Sales activity varied by market segment

  • Single family sales were up 10.8 percent; condo sales fell 10.6 percent; townhome sales increased 3.4 percent
  • Traditional sales rose 8.4 percent; foreclosure sales were down 20.9 percent; short sales fell 25.9 percent
  • Previously owned sales were up 7.3 percent; new construction sales climbed 14.1 percent

From The Skinny Blog.

Weekly Market Report

For Week Ending January 16, 2021

Mortgage giant Freddie Mac reported this week that rates on a 30-year fixed-rate mortgage averaged 2.79% with .7 points. That is up slightly from the record lows seen last week, but almost one percent lower than the same week a year ago. Rates are expected to increase slightly this year, with the National Association of REALTORS® expecting rates to average 3.1 percent in 2021, and the Mortgage Bankers Association estimating an average of 3.3 percent.

In the Twin Cities region, for the week ending January 16:

  • New Listings increased 0.8% to 929
  • Pending Sales increased 7.4% to 815
  • Inventory decreased 40.2% to 5,125

For the month of December:

  • Median Sales Price increased 10.0% to $307,000
  • Days on Market decreased 30.4% to 39
  • Percent of Original List Price Received increased 2.5% to 99.7%
  • Months Supply of Homes For Sale decreased 41.2% to 1.0

All comparisons are to 2020

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.

Weekly Market Report

For Week Ending January 9, 2021

The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey reported that 5.53% of mortgage loans remained in forbearance as of December 27, 2020. While the forbearance rate is down significantly from its highest levels in 2020, the MBA estimates the current rate represents 2.7 million homeowners currently in forbearance plans.

In the Twin Cities region, for the week ending January 9:

  • New Listings decreased 8.3% to 927
  • Pending Sales increased 1.3% to 636
  • Inventory decreased 39.8% to 5,098

For the month of December:

  • Median Sales Price increased 10.0% to $307,000
  • Days on Market decreased 30.4% to 39
  • Percent of Original List Price Received increased 2.5% to 99.7%
  • Months Supply of Homes For Sale decreased 47.1% to 0.9

All comparisons are to 2020

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.

Weekly Market Report

For Week Ending January 2, 2021

The New Year has begun and with it, many buyers and sellers have a change of housing in their new year resolutions. While ongoing unemployment claims are still elevated, it is less than one quarter of what it was at its high during the early days of the pandemic. With interest rates remaining near record lows, the stock market near record highs, and inventory of homes available still constrained in most segments of the market, the year is setting up to be another filled with strong demand and limited supply.

In the Twin Cities region, for the week ending January 2:

  • New Listings decreased 25.8% to 519
  • Pending Sales increased 17.0% to 653
  • Inventory decreased 38.1% to 5,511

For the month of November:

  • Median Sales Price increased 10.7% to $310,000
  • Days on Market decreased 33.3% to 34
  • Percent of Original List Price Received increased 2.8% to 100.2%
  • Months Supply of Homes For Sale decreased 40.9% to 1.3

All comparisons are to 2020

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.

Weekly Market Report

For Week Ending December 26, 2020

As we near the end of the year, overall real estate activity slows as many buyers and sellers briefly turn their focus from real estate to the holidays, family, and friends. With mortgage rates closing the year at near record lows, and almost one percent lower than a year ago, home purchase mortgage loan application volume remains high and continues to signal strong buyer demand going into the new year.

In the Twin Cities region, for the week ending December 26:

  • New Listings increased 22.0% to 338
  • Pending Sales increased 17.0% to 593
  • Inventory decreased 37.9% to 5,777

For the month of November:

  • Median Sales Price increased 10.7% to $310,000
  • Days on Market decreased 33.3% to 34
  • Percent of Original List Price Received increased 2.8% to 100.2%
  • Months Supply of Homes For Sale decreased 40.9% to 1.3

All comparisons are to 2019

Click here for the full Weekly Market Activity Report. From MAAR Market Data News.