Twin Cities Real Estate Market Update
At the beginning of the year, we predicted that the Twin Cities real estate market would continue to improve throughout the year, and we’re seeing this improvement in real time with many of our sellers getting multiple offers on their homes within just a few days on the market.
When in comes to foreclosures and short sales, we’ve seen a decrease of 25% in the last year, which lowers the supply of homes on the market. With that lowered supply, we see buyers bidding above list price on the houses they want. We’re also seeing lots of new construction builders get back into the market because of this increase in buyer demand.
Another thing that’s been interesting is how interest rates have actually gotten lower. We predicted they would see a slight uptick, but thanks to what’s happening in Europe, rates have remained low; historically low, even. That’s awesome news for the real estate market.
Lower rates allow a lot of new, first-time home buyers to get into the market, and existing homeowners are able to “move up” into the next tier of homes that are larger or more expensive. What this has done is create a bit of a ceiling or tipping point for homes at or above $500,000. The market for homes priced above $500,000 is a little bit flat, with higher inventory and less demand.
The market is hotter in price points below $500,000. If you look across the Twin Cities, the year-to-date appreciation is essentially zero, while the price points below $500,000 have appreciated about 5% in the same timeframe.
This isn’t necessarily the case in all specific neighborhoods, so if you’d like a more specific, localized market analysis for your area or an area you’re interested in, let us know and we’ll send one out to you.
If you have any questions about buying or selling a home in the Twin Cities, give us a call soon!