New listings falling short of market demand
The Minnesota real estate market stayed strong with closed sales up +14.5% over last May, and pending sales increasing by +9.4%. However, demand continued to squeeze available inventory as new listings only inched above last May’s levels at +0.2%. The median price rose to $310,000, up +15.7% from 2020, an all-time high for sales price and a high-water mark for the year over year percentage increase. Days on market dropped by -37% to just 29 days, a historic low. Buyers are feeling the pressure and pursuing homes with multiple offers while houses come on and off the market very quickly. Properties were receiving an average of 4.5% over the original asking price. The statewide inventory of homes shrank to 8,953, down -50.5% compared to June 2020. Total months supply remained historically low at 1.1, down -57.7% from last year.
“As we anticipated, buyers are very active but there simply isn’t the inventory to meet their demand,” said Chris Galler, CEO of Minnesota Realtors. “This has created a competitive environment where multiple offers are the norm. Although you’d think that would be an incentive for more sellers to list their homes, many are hesitating because they worry about becoming home buyers in this environment. It’s a cycle that will only be broken by increased inventory or higher interest rates that slow demand.”
May year-over-year summary:
- Closed sales: +14.5% to 7,982
- Median sales price: +15.7% to $310,00
- Average sales price: +20.6% to $361,325
- New listings: +0.2% to 10,814
- Pending sales: +9.4% to 9,642
- Days on the market: -37.0% to 29 days
- Homes for sale: -50.5% to 8,953
Closed Home Sales Across Minnesota by Region
9 of the state’s 13 regions reported increases in closed sales compared to May 2020, with six of them seeing double-digit growth. Three regions marketed declines, with North Central down -1.5%, South Central at -6.3%, and Northwest falling -14.3%. See the chart below for more details comparing May 2021 to May 2020.
The seven-county Twin Cities region comprises Anoka, Carver, Dakota, Hennepin, Ramsey, Scott and Washington counties. The official Minneapolis-St. Paul-Bloomington metropolitan statistical area recognized by the Census Bureau consists of 16 counties, on which MAR & SPAAR local associations report.
View full regional and county reports here.
View statewide report here.
About Minnesota Realtors®
Minnesota Realtors® (MNR) is the membership organization supporting all 22,000 Realtors® in the state of Minnesota. MNR is dedicated to helping Realtors® succeed in providing comprehensive and informed guidance to their customers seeking to buy or sell a home. MNR provides Realtors® with a code of ethics, continuing education, real estate transaction forms, legal services and dispute resolution, as well as lobbying and advocating for homeownership rights and the real estate industry. MNR works in partnership with the National Association of Realtors, as well as more than 15 affiliate regional associations within Minnesota. MNR is a non-profit organization founded in 1919, with headquarters in Minnetonka, Minnesota, and a branch office in St. Paul, Minnesota. Find us at www.mnrealtor.com and follow us on Facebook, Instagram, Twitter and LinkedIn.