RE trends that will affect 2019
There is so much to love about Minnesota, from lakes and recreation to the “Minnesota Nice” attitude. As real estate activity slows during the holidays, it is a good time to look at what the market is doing. If you are planning on buying or selling, we can help you translate this information into your particular area or neighborhood.
Statewide, closed sales are down 6% from last year, with pending sales down 4%. The good news is that both prices and percent of list price improved from last year. Homes in Minnesota also continue to appreciate in value, but at a rate slightly lower than the national average. Data collected on home appreciation values over a five-year period from 2012 to 2017 show that homes appreciated by 37.4% across the country, and by 31% in Minnesota.
According to Zillow, the median home value in Minnesota is $225,210, which means that the value has increased by 8.2% over the past year, and Zillow predicts that value will rise 4.9% within the next year.
Zillow gives the Minnesota housing market a rating of “very healthy,” and sites that homes spend an average of 91 days on Zillow, and less than 1% of Minnesotan homes are listed as delinquent on their mortgages.
Influencing Factors in the 2018 Minnesota Real Estate Market
Zillow also sites that foreclosures will be a factor in the 2018 Minnesota housing market. Though delinquent mortgages in Minnesota are below the national average, 1.7 homes per 10,000 are foreclosed, and 8% of Minnesotans are underwater on their mortgages.
Inventory remains the biggest factor for the Minnesota housing market. From December of 2016 to December of 2017, inventory was down 27.5% making it the lowest for the Minnesota housing market since 2004.
It’s a seller’s market for sure in the land of lakes. With fewer new listings on the market, supply remains low as demand remains high, helping to raise home prices.
This shortage of inventory also means that retirees and first-time buyers are often competing for the same short supply of homes. That means that not only will the supply of homes be important to watch in 2018, but also the available price ranges.
Mortgage rates across the country will also play a prominent role in the 2018 housing market. Experts expect rates to reach 5% by the end of the year, which will affect what buyers can afford. This may lead to a decrease in the median sale price, but experts are not worried since it still falls way below the 8% mortgage rates of the recent recession.
Your buying and selling decisions
Want to know more about what the market indicators mean for your real estate goals? Get in touch…we would be happy to help!