September 2021 Market Insights

Key insights from August 2021 (compared to August 2020)*

• New listings: 7,644 | -3.6%
• Median sales price: $350,000 | +11.1%
• Closed sales: 6,898 | +0.6%
• Pending sales: 6,525 | -10.3%
• Days on market: 22 | -43.6%
• Inventory: 7,686 | -20.1%
• Months’ supply: 1.4 | -26.3%

August home pricing and sales volume remain up as market continues its crawl toward balance

The Twin Cities real estate market posted another busy summer month in August, with median pricing remaining at a record level and sales volume besting last year’s same period. But the market also continues to see a slight bounce-back in inventory, indicating a slight trend toward buyer-seller balance.

The market’s median price was $350,000 for a third month in a row in August. That price is an 11.1% increase from August 2020. The market’s median price year-to-date is $340,000, up 13.3% from the first eight months of last year.

What’s driving the pricing increase? So far, two main factors: Competition from buyers and a lack of inventory.

Competition from buyers remains a major factor. The typical home spent just 22 days on the market in August. That’s down 43.6% from last year, and a fraction of the roughly three months the typical home spent on the market just five years ago.

With homebuyers willing to compete for the best properties, sellers were able to capture more in a sale. In August, sellers received 102.4% of their original list price. That’s down slightly from July 2021, but up more than 2% from the same month last year.

The other factor driving prices upward, inventory, is starting to shift in favor of buyers. At the end of the month, there were 7,686 homes for sale, roughly a 1.4-month supply. The inventory is down 20.1% from last August, a significant drop. But that’s also the closest the market has come to matching 2020’s inventory so far this year: Inventory was down as much as 43.8% this spring.

All the above ingredients add up to a market full of activity. 6,898 sales closed in August, up 0.6% from August 2020. With more than 43,000 sales recorded this year, the market is up 8.3% year-to-date.

It remains to be seen whether September can match that activity. Just 6,525 sales were pending at the end of the month, down 10.3% from August 2020. However, pending sales were down more than 10% at the end of July as well, and August volume ended up surpassing 2020.

Buyers remain advised to act aggressively and decisively in the market. 7,644 homes were newly listed in August, down 3.6% from August 2020.

As long as pricing remains this high and closings occur so soon after listing, sellers will continue to enjoy this sales atmosphere. Whether enough homes will be put up for sale to help balance the market, that’s an entirely different question.

Economic check up

• Minneapolis-St. Paul area unemployment rate: 3.5% (as of July 2021)
• Average rates for 30-year conforming mortgage 2.86%**
• Extremely low interest rates continue to offer exceptional buying and refinancing opportunities.

The long and the short of it

• Median pricing has remained at the record $350,000 for a third consecutive month.
• Properties are selling within 22 days of hitting the market, near a record pace.
• Inventory remains low from a historical perspective, but has continued its slow climb upward.

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. Your wellness and safety continue to be our top priority.

*Data courtesy NorthstarMLS for the 16-County Twin Cities metro area for August 2021.

**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: 176 | +20%
• Avg. sales price: $280,701 | +6%
• Pending sales: 160 | +1%
• Days on market: 23 | -61%
• Inventory: 224 | -20%
• Months’ supply: 2.0 | -26%

Brainerd area

• New listings: 808 | +6%
• Avg. sales price: $317,345 | +16%
• Closed sales: 610 | -12%
• Days on market: 24 | -61%
• Inventory: 1,027 | -28%
• Months’ supply: 2.1 | -28%

Duluth area

• New listings: 446 | -11%
• Avg. sales price: $270,059 | +17%
• Closed sales: 499 | -3%
• Days on market: 26 | -54%
• Inventory: 829 | -19%
• Months’ supply: 2.4 | -20%

Southeast Minnesota area

• New listings: 685 | -4%
• Avg. sales price: $276,879 | +11%
• Closed sales: 637 | -2%
• Days on market: 25 | -46%
• Inventory: 765 | -26%
• Months’ supply: 1.4 | -26%

St. Cloud area

• New listings: 230 | +7%
• Avg. sales price: $262,598 | +13%
• Pending sales: 196 | +4%
• Days on market: 21 | -40%
• Inventory: 218 | -28%
• Months’ supply: 1.3 | -35%

Mankato area

• New listings: 245 | -14%
• Avg. sales price: $239,751 | +7%
• Pending sales: 178 | -33%
• Days on market: 65 | -31%
• Inventory: 272 | -26%
• Months’ supply: 1.5 | -21%

Northwestern Wisconsin area

• New listings: 692 | -3%
• Avg. sales price: $276,520 | +17%
• Closed sales: 665 | -5%
• Days on market: 73 | -34%
• Inventory: 1,874 | -21%
• Months’ supply: 3.5 | -26%

West Central Minnesota area

• New listings: 374 | +10%
• Avg. sales price: $204,254 | +15%
• Pending sales: 322 | +2%
• Days on market: 39 | -39%
• Inventory: 576 | -36%
• Months’ supply: 2.1 | -43%

Bemidji area

• New listings: 75 | -12%
• Median sales price: $222,250 | -12%
• Pending sales: 74 | -6%
• Inventory: 132 | +5%
• Months’ supply: 2.2 | -12%

Leech Lake and surrounding area

• New listings: 102 | +17%
• Median sales price: $252,450 | +7%
• Pending sales: 73 | -26%
• Days on market: 7 | -85%
• Inventory: 132 | -27%
• Months’ supply: 2.2 | -29%

Little Falls area

• New listings: 38 | -7%
• Median sales price: $187,500 | +4%
• Pending sales: 30 | -14%
• Days on market: 12 | -14%
• Inventory: 30 | -35%
• Months’ supply: 1.2 | -37%

Southwest Minnesota area

• New listings: 120 | +0%
• Median sales price: $155,000 | +4%
• Pending sales: 125 | +5%
• Days on market: 33 | -44%
• Months’ supply: 2.2 | -42%

Headwaters area

• New listings: 147 | -1%
• Median sales price: $229,900 | +18%
• Pending sales: 120 | -11%
• Days on market: 38 | -49%
• Months’ supply: 2.3 | -30%