Before I even launch into this I need to mention that real estate is local. There are always nationwide trends and they are important but base your decisions about buying or selling real estate mostly on the local numbers and market conditions.
Housing is in the news a lot lately and I think it is at least partly because during the last recession the housing market crashed. The pain is still fresh for many and they may be worried about the value of their real estate.
Fear not the value of your real estate in St. Paul and Minneapolis continues to rise.
I am seeing news about how nationally June pending home sales were up 16.6% from May pending home sales. (NAR)
I believe that activity slowed during the lockdowns and what we are seeing in those pending sales is activity from March and April postponed until May.
There will be fewer home sales in the metro area this year than there were last year. Fewer homes for sale each year is part of a 7-year trend. Locally the pandemic has strengthened that trend.
Without the pandemic, I had predicted that the trend would continue until about 2025. Right now making predictions five years into the future is just silly. The future has been changed but will remain open in spite of COVID-19.
There is news about how the housing market is recovering. That implies that something bad happened that we needed to recover from. I don’t see it except for the fact that there are fewer homes on the market and they are more expensive than ever. We definitely have not recovered from that.
It is hard to determine what the long term effect of the pandemic will be on housing or even the full impact in 2020. I am not the first to say that we don’t have a similar event we can compare the pandemic to.
It is a good sign that after home sales fell during the “stay at home order” they rebounded again. I will need a few more months’ data before I am convinced that it is time for the happy dance.
Here are some recent statistics for the Twin Cities from the Minneapolis Area Association of Realtors:
In the Twin Cities region, for the week ending July 18:
• New Listings decreased 9.1% to 1,753
• Pending Sales increased 10.2% to 1,541
• Inventory decreased 27.2% to 9,339
For the month of June 2020:
• Median Sales Price increased by 5.2% to $304,995
• Days on Market increased by 2.4% to 42
• Percent of Original List Price Received decreased 0.4% to 99.6%
• Months Supply of Homes For Sale decreased by 29.6% to 1.9
If you would like to sell your house or a house this year it is still an excellent year for selling houses quickly and for top dollar.
I’ll have July home sales numbers for St. Paul next week.