May 2023 Market Insights

Key insights from April 2023 (compared to April 2022)*

• New listings: 5,170 | -27.9%
• Median sales price: $367,500 | -0.7%
• Closed sales: 3,263 | -32.2%
• Pending sales: 4,029 | -28.8%
• Days on market: 45 | +60.7%
• Inventory: 6,155 | -4.5%
• Months’ supply: 1.5 | +25.0%

Home prices remain stable, listings and sales come up short

The highlights

• The median sales price remains stable—good news for sellers who want to take advantage of equity.
• Home sales declined by nearly a third, thanks in large part to a shortage of homes for sale and fluctuating interest rates.
• Homes take about a month and a half to sell on average with some still attracting multiple offers, especially when in good condition.

Breaking it down

The traditional spring market remains elusive, with sales activity down throughout the 16-county Twin Cities metro area and more broadly throughout the country.

With new listings down 27.9%, sellers who are also move-up buyers may be temporarily staying put to see what happens with interest rates. This results in a shortage of available homes for sale and has put the squeeze on buyers looking for “the right” property.

With a dearth of inventory for sale comes a lack of sales activity. Closed sales were down 32.2% from last April, but home prices remain stable (dipping slightly) as buyers compete for limited properties for sale.

The months’ supply of homes for sale has increased 25% to 1.5 months. What does that mean? If no new homes were listed for sale, and homes continued to sell at the same pace as they did for the past 12 months, it would take 1.5 months for all the homes currently on the market to sell. At 1.5 months, we are still firmly in a seller’s market. A balanced market is typically closer to six months.

Seller opportunities

• Sellers are still receiving 100.1% of their asking price, thanks in large part to the old rule of supply and demand. Not enough supply of homes for sale to meet the demand from buyers translates into more competitive offers from buyers and less discounting from sellers.
• According to data published in Q3 of 2022 by Investopedia, homeowners have an average of $185,000 worth of equity. That means sellers can take advantage of cash-on-hand for down payments and buying down interest rate points.
• Sellers may be able to buy a larger home with a similar monthly mortgage payment even with a higher interest rate. How? With a bigger down-payment from existing equity.
• Download the Ultimate Guide to Selling Your Home for tips and ideas from local professionals.

Buyer opportunities

• On average, homes are on the market for 45 days, giving buyers more time to make an informed decision—and their best offer.
• While interest rates fluctuate, some lenders offer the ability to lock in rates, buy down points, or refinance at a lower fee in the future.
• Down payment assistance programs may be available for qualified buyers on qualified homes.
• Buyers may not need to come up with a 20% down payment.
• As you begin your home search, find out everything you need to know about buying—get the Go-To Guide for Buying a Home. It’s free and full of answers to your home buying questions.

Economic check up

• Minneapolis-St. Paul area unemployment rate: 2.8% (as of March 2023)
• Average rates for 30-year conforming mortgage 6.35%**

Ready to help

We are here to help you confidently navigate your housing needs, now and always. Whether you are researching future options, or your circumstances require immediate action, reach out to an Edina Realty agent today for guidance.

*Data courtesy NorthstarMLS for the 16-County Twin Cities metro area for April 2023.

**Data sourced from Freddiemac.com for informational purposes only. Please contact your mortgage consultant for any questions related to specific loan transactions.

Where you live

Edina Realty serves locations across Minnesota and western Wisconsin. Here’s a look at the market indicators where you live. All % changes are year-over-year.

Alexandria Area

• New listings: 83| -37%
• Avg. sales price: $298,719 | -2%
• Pending sales: 56 | -47%
• Days on market: 48 | -2%
• Inventory: 116 | No change
• Months’ supply: 1.6 | +33%

Brainerd area

• New listings: 448 | -24%
• Avg. sales price: $341,642 | +9%
• Closed sales: 277 | -10%
• Days on market: 60 | +71%
• Inventory: 707 | +21%
• Months’ supply: 1.8 | +38%

Lake Superior area

• New listings: 248 | -36%
• Avg. sales price: $301,100 | +12%
• Pending sales: 147 | -37%
• Days on market: 42 | +62%
• Inventory: 485| +11%
• Months’ supply: 1.8 | +38%

Southeast Minnesota area

• New listings: 575 | -6%
• Avg. sales price: $295,015 | -6%
• Closed sales: 370 | -17%
• Days on market: 48 | +55%
• Inventory: 654 | +48%
• Months’ supply: 1.5 | +67%

St. Cloud area

• New listings: 126 | -37%
• Avg. sales price: $269,564 | +6%
• Pending sales: 134 | -23%
• Days on market: 44 | +110%
• Inventory: 147 | +8%
• Months’ supply: 1.2 | +33%

Mankato area

• New listings: 202 | -15%
• Avg. sales price: $284,348 | +0%
• Pending sales: 139 | -33%
• Days on market: 86 | +6%
• Inventory: 267 | +54%
• Months’ supply: 1.8 | +80%

Northwestern Wisconsin area

• New listings: 410 | -32%
• Avg. sales price: $302,759 | +6%
• Closed sales: 259 | -29%
• Days on market: 92 | +2%
• Inventory: 1,033 | -16%
• Months’ supply: 2.6 | +8%

West Central Minnesota area

• New listings: 256 | +2%
• Avg. sales price: $208,366 | +1%
• Pending sales: 221 | +5%
• Days on market: 68 | +31%
• Inventory: 397 | +43%
• Months’ supply: 1.9 | +27%

Bemidji area

• New listings: 63 | +11%
• Median sales price: $210,00 | -12%
• Pending sales: 40 | -18%
• Inventory: 95 | +19%
• Months’ supply: 2.10 | +50%

Leech Lake and surrounding area

• New listings: 42 | -25%
• Median sales price: $258,900 | -10%
• Pending sales: 24 | -41%
• Days on market: 12 | +100%
• Inventory: 82 | +37%
• Months’ supply: 1.8 | +64%

Little Falls area

• New listings: 20 | -33%
• Median sales price: $325,000 | +48%
• Pending sales: 16 | -24%
• Days on market: 6 | -40%
• Inventory: 13 | -38%
• Months’ supply: 0.70 | -22%

Southwest Minnesota area

• New listings: 111 | -20%
• Median sales price: $145,000 | -6%
• Pending sales: 83 | -27%
• Days on market: 63 | +3%
• Months’ supply: 2.30 | +35%

Headwaters area

• New listings: 88 | -25%
• Median sales price: $215,000 | -9%
• Pending sales: 63 | -28%
• Days on market: 71 | +87%
• Months’ supply: 2.20 | +38%