Bucking typical seasonal housing market trends, last month was busier than any other November since 2004, according to data from the Minneapolis Area Association of REALTORS®.
While it seems like the far distant past after our recent winter reality check, October and November were unusually mild, which encouraged buyers to continue their house hunting longer than normal.
Buyer competition can still be found in popular areas and price points around the metro. Sellers who are thinking about waiting until spring might want to think again; homebuyers shopping in winter and around the holidays are more serious and are currently facing a major shortage of listings:
- Inventory of homes for sale was down 23 percent
- The number of new listings coming on the market was down 1 percent
- Pending sales in November were up 9 percent over last year
- Starter homes priced $190,000 – $250,000 had the most sales activity
Sellers who take advantage of the low-inventory conditions could see fast sales and good prices, even in the cold months.
- The average time on market fell to 61 days, compared to 73 days last November
- The November median sales price clocked in at $232,000 – up nearly 6 percent
All this doesn’t mean that sellers can shoot for the moon with their home prices. Buyers are more knowledgeable about market conditions and just as discerning about value as ever.
To explain: In November, sellers received an average of 96.7 percent of their original price, and 98.7 percent of the most recent list price, indicating that homes priced too high for the market sell for nearly asking price once they drop within range of what buyers are willing to pay.
Luxury market update
Homes priced above $500,000 have a dynamic that sets them apart from the rest of the market. Sellers in this price range can expect a longer time on market and less buyer competition.
- The average days on market was 127 days, up .8 percent from last year
- The number of new listings was up 9 percent year-over-year
- The months’ supply of homes for sale was 6.5, which suggests a more balanced market
Economic check up
- The Minneapolis-St. Paul area unemployment rate is 3.1 percent, among the best in the nation
- Mortgage rates have been rising slowly over several weeks with more increases expected to come, but experts don’t believe the rate hikes will be drastic
- Incomes in the U.S. are finally starting to rise, which should continue to bring new buyers to the market