Spring in February

The spring real estate market is in full swing even though it is still winter and will be for several more weeks.  It has more to do with income tax refunds and returns than it has to do with the weather.

The graphic is a screenshot from the NorthStarMLS of activity over the last seven days. If I compare new listings with pending status listings I can see that demand for houses is strong.

activity dashboard
market activity in St. Paul for the last 7 days

Some homebuyers are getting refunds that will help with down payments.  Others are relieved that they don’t owe money and are ready to spend.

Here is a snapshot of home sales in January for the whole state:

Minnesota home sales
Minnesota home sales for January 2020

 

Impact of the Soccer stadium so far

Maybe it is too early to tell but for a few years, homeowners in the Midway area have been asking about what kind of impact the Soccer stadium (Allianz field) will have on residential property values.

Here is some data. The top chart shows median home sale prices in all of St. Paul excluding the Hamline/Midway neighborhood. There has been a 43% increase in median home sale prices in the last five years.  In 2019 the median sale price was 223,500 up from 156K in 2014.

Graph of median home sale prices
Hamline/Midway Median home sale price

The second chart shows median home sale prices over the same period for the rest of St. Paul and again we see a 43% increase in five years. The 2019 median sale price was slightly higher at 257K.

graph of median home sale prices
St. Paul median home sale prices – excluding the Midway neighborhood

I haven’t been to the stadium, that is because I am not much of a sports fan but it is on my list of places to photograph.

Declining home sales

Home sales in St. Paul declined for the 3rd year in a row. The decline is due to fewer home sellers. It has to do with demographics. Older homeowners are opting to age in place rather than downsize.

Buyers are still buying and there is less than a two month supply of homes for sale in much of the metro area. Home sales in Minneapolis have been fairly flat for the past five years as the seller’s market continues.

Home sales in 2020 should be about the same as they were in 2019. Home prices will go up in St. Paul by a modest 3 or 4%.

2012 - 2019 yearly home sales
Home sales in St. Paul

Data used to make the chart came from the NorthstarMLS which is deemed reliable but not guaranteed.

January Home sales by neighborhood

I love numbers, they are a great way to start the week or they can be published on a Thursday. Speaking of numbers this site gets the most readers on Thursdays according to Google Analytics.

Median sale prices were higher in January than they were last December. The red on the chart shows where in the Battle Creek Highwood neighborhood and on the Westside the average list price was less than the average sale price.  We are likely to see more of that as the year progresses.

The number of homes on the market in St. Paul is very low at around 310. We remain in a strong buyer’s market.

The data used to make the table was extracted from the NorthstarMLS which is deemed reliable but not guaranteed. It was gently sorted in an MSExcel spreadsheet before anyone noticed that it was missing.

For more local numbers please see Local market conditions & home prices

Old rules about selling in spring

It used to be some kind of a rule that spring was the time to sell a house. Actual home sale data for the metro area tells a different story.  The number of homes on the market goes way down in the winter which makes it harder for buyers and results in fewer home sales.

The math is simple, when there are fewer homes on the market there are fewer home sales.

The median number of days that a home in the twin cities was on the market in January was 23 days which is the same as it was last May. It is a myth that homes take longer to sell in the winter. That rule no longer applies.

The mythology persists that home sellers who sell in the spring sell for more money. It didn’t work that way last year. Average prices have gone up since last spring.

Right now there are only 245 houses on the market in St. Paul that do not have offers on them. Anyone who is waiting until spring to sell is missing out on a hot seller’s market.

Sunrise Mississippi River
Winter Sunrise over St. Paul

Also see More houses to come on the market soon

Features buyers want in homes

old house with steeple
Queen Anne house in St. Paul

Here are some of the features home buyers are looking for according to a survey the National Association of Home Builders. The good news is most of them can be added to any existing home. A walk-in pantry might be a challenge but several items on the list are easy to do.

  • Laundry rooms
  • Energy Star–rated windows
  • Hardwood flooring
  • Walk-in pantries
  • Patios
  • Ceiling fans
  • Kitchen double sink

New construction in the five-county metro area costs an average of 610,000. The most expensive item on the list is the laundry room.  The average cost of adding a laundry room is about $6000.

New homes built in the five-county metro area in 2019 had 3.57 bedrooms, 3.19 baths and an average of 2725 square feet of finished living space. Almost twice as big as my little antique St. Paul home with the unfinished basement where there is plenty of space for a laundry room.