The Minnesota housing market experienced significant changes in 2023. While several key metrics have shown declines, such as new listings, pending sales, and closed sales, the median sales price has remained relatively stable. The market is leaning towards balance, providing opportunities for both buyers and sellers to navigate the real estate landscape with confidence.
Minnesota Housing Market Trends 2023
Understanding the housing market in Minnesota is essential for anyone considering buying or selling a home. In this blog post, we'll explore the latest market data for August 2023, provided by the Minnesota REALTORS®, and answer key questions about housing prices and affordability in the state.
Key Metrics for August Year to Date 2023
- New Listings: In 2023, there were 9,124 new listings, slightly down by 0.4% compared to the same period in 2022. However, for the year through August, there's a more pronounced decrease of 15.4%.
- Pending Sales: The number of pending sales experienced a significant drop of 10.6% in 2023 compared to the previous year. Year-to-date figures also depict a 17.9% reduction.
- Closed Sales: Closed sales saw a decrease of 11.8% in 2023, and for the year through August, the decline was 20.4%.
- Median Sales Price: The median sales price increased by 5.5% from $331,525 in 2022 to $349,650 in 2023. However, the growth rate slowed to 1.8% year-to-date through August.
- Percent of Original List Price Received: The percentage of the original list price received for homes remained relatively stable with a minor decrease of 0.1% year over year. However, there was a more noticeable decrease of 2.1% year-to-date through August.
- Days on Market Until Sale: The average days on the market increased by 6.9% in 2023, indicating a slightly slower market compared to the previous year. Year-to-date figures showed a more substantial increase of 23.3%.
- Months Supply of Inventory: The months supply of inventory increased by 25.0%, highlighting a shift towards a more balanced or buyer's market due to increased inventory.
Now, let's address the important questions about housing prices and affordability in Minnesota:
- Are housing prices dropping in Minnesota? No, the data for 2023 indicates an increase in the median sales price by 5.5%, suggesting that housing prices are not dropping but rather experiencing a moderate growth rate.
- What's the average house cost in Minnesota? The median sales price for homes in Minnesota is $349,650 as of the data provided for August 2023.
- Why are houses in MN so expensive? The increase in housing prices can be attributed to various factors, including demand exceeding supply, desirable living conditions, a strong economy, and low mortgage rates. Additionally, factors like location, amenities, and housing demand can contribute to higher housing costs in Minnesota.
Minnesota Housing Market Forecast 2023-2024
As we look ahead to the housing market in Minnesota, it's essential to consider both current data and future predictions. In this blog post, we'll explore the latest insights and forecasts for the Minnesota housing market in 2023 and beyond.
Current Market Snapshot
Let's start by examining the current state of the Minnesota housing market based on data from Zillow as of July 31, 2023:
- The average home value in Minnesota is $331,869, showing a slight 0.0% change over the past year. This suggests a level of stability in home prices.
- Homes in Minnesota go to pending status in approximately 13 days, indicating a relatively fast-paced market.
- Additional key statistics as of June 30, 2023, include a median sale-to-list ratio of 1.003, 52.2% of sales recorded over the list price, 29.6% of sales below the list price, and a median of 13 days to pending status as of July 31, 2023.
This data provides valuable insights into the current conditions of the Minnesota housing market, suggesting stability in home values and a competitive environment for buyers.
Top 10 MSAs in Minnesota for Home Price Growth by July 2024
Now, let's take a look at the forecasted home price growth for the top 10 Metropolitan Statistical Areas (MSAs) in Minnesota by July 2024:
- Brainerd, MN MSA: The forecast predicts a 7.2% increase in home prices by July 2024.
- Fergus Falls, MN MSA: Expect a 6.3% growth in home prices in this area by July 2024.
- Hutchinson, MN MSA: Home prices are forecasted to grow by 5.9% by July 2024.
- Austin, MN MSA: A 5.8% increase in home prices is anticipated in this area by July 2024.
- Albert Lea, MN MSA: Home prices are expected to rise by 5.7% in this region by July 2024.
- Owatonna, MN MSA: A 5.4% growth in home prices is projected by July 2024.
- Willmar, MN MSA: Home prices are forecasted to increase by 5% in this area by July 2024.
- Duluth, MN MSA: Expect a 4.9% growth in home prices in Duluth by July 2024.
- Winona, MN MSA: The forecast predicts a 4.9% increase in home prices in Winona by July 2024.
- Bemidji, MN MSA: Home prices are expected to grow by 4.9% in Bemidji by July 2024.
These forecasts highlight the potential for home price growth in various regions of Minnesota, with some areas showing strong anticipated increases by July 2024.
The Minnesota housing market presents a diverse landscape with stability in home prices and varying growth prospects across different MSAs. While overall home values have shown little change, the forecasted growth in certain areas offers opportunities for both buyers and sellers.
It's important to note that market conditions can change over time, so it's advisable for buyers and sellers to stay updated and consult with real estate professionals for the most accurate and timely information.
Sources:
- https://www.mnrealtor.com/buyers-sellers/marketreports
- https://fred.stlouisfed.org/series/MNSTHPI#
- https://www.zillow.com/mn/home-values/
- https://www.neighborhoodscout.com/mn/real-estate
- https://fred.stlouisfed.org/series/ACTLISCOUMN#
