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October 2025 Housing Market Report

By MNR News posted 20 days ago

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More Listings, Lower Rates, Fewer Sales
Key Updates: According to new data from the Minnesota state and Twin Cities metro REALTOR® Associations, seller activity was up while buyer activity was down in October. Prices and market times rose.

New listings rose 3.3% statewide and 2.6% in the Twin Cities metro
Pending sales decreased 1.9% statewide and fell 2.8% in the metro
The median sales price climbed 0.9% statewide to $351,200, and 2.1% in the metro to $389,900

Sellers, Buyers and Housing Supply

The National Association of REALTORS® (NAR) recently released two surprising figures that highlight the challenges first-time buyers are facing in today’s housing market. First-time buyer share shrank to just 21% of home buyers compared to a historical norm of about 40%. The median age of those first-time buyers rose to 40 compared to the late-20s historically. Those are national figures, however, and may not reflect the local picture. Realtor.com analysis recently found that Minnesota is the only state where homeownership rates for Gen Z and younger millennials is over 50% (source). “That likely reflects home prices below the national average and incomes above the national average here in Minnesota,” said Patti Jo Fitzpatrick, President of Minnesota Realtors®. “Even though we’ve seen our share of affordability challenges, buyers remain resilient and we’re proud to have a more affordable housing stock compared to other parts of the country.”

That’s not to dismiss the significant headwinds facing home buyers—particularly first-timers—who lack the equity from their last property to roll into the next. Fewer people can afford to buy homes, which is constraining both supply and demand. Since mortgage rates touched their lowest levels in a year during October, the softer demand could be related to other factors like a slowing labor market, rising inflation, household finances, consumer confidence and changes around student loan payments and insurance (health and homeowners’) costs. For October, seller activity increased while buyer activity fell in both the state and metro. Overall, 51.9% of Minnesota counties showed year-over-year new listings growth, while 54.8% of counties had more sales than last October. Inventory levels rose slightly statewide and fell slightly in the metro. With 3.1 and 2.7 months of supply respectively, both the state and metro technically remain in sellers’ market territory. Roughly five to six months of supply indicates a balanced market.

The average 30-year mortgage rate stood around 6.25% this October compared to 6.43% last October. Even a small change in rates can make a difference in affordability. The White House’s 50-year mortgage proposal, which recently made headlines, would lower monthly payments but would increase the net interest paid substantially and slow equity gains. Assuming the economy remains resilient, better affordability should bring more sidelined buyers into the market.

Market segmentation

Pending sales activity in October varied widely by segment based on analysis of 97% of statewide data:

Existing pending home sales rose 0.5% while new home sales were down 2.4%
Single-family sales were up 1.5%, condo sales decreased 14.2% and townhome sales fell 5.9%
Sales <$500K fell 1.8%; sales between $500K-1M were up 6.3%; $1M+ sales increased 8.0%
Traditional sales decreased 0.4% while lender-mediated sales were up 23.8% (63 to 78)
Sales under 1,800 feet2 declined 0.6% while sales over 1,800 feet2 increased 0.6%

“What’s affecting the condo market isn’t the same as what’s driving single family sales and what’s happening under $300,000 is quite distinct from the $1,000,000+ market,” said Jennifer Livingston, President of the Saint Paul Area Association of REALTORS®.

Prices, Market Times and Negotiations

Statewide home prices rose 0.9% to $351,000 while the Twin Cities metro price increased 2.1% to $389,900. A full 72.1% of counties had price growth, more than in August and September. While every situation is unique when it comes to downpayment, home price, insurance, taxes and utilities, a typical monthly payment on the median-priced home was roughly $2,900 for the metro and $2,650 statewide (metro included, assuming a 10% down payment). “When prospective buyers talk about housing affordability, they’re mostly referring to monthly payments,” said Frank D’Angelo, President of Minneapolis Area REALTORS®. “That’s where the marriage between price and rate is truly ‘felt’ each month. It’s encouraging that rates are easing while we’re already outperforming most other states and regions.”

Market times or days on market varied from 5 days in some regions to 139 days in others. Metro homes spent 48 days on market, 6.7% higher than last October, while statewide market times were 45 and 7.1% higher than last year. Using the same metro calculation, statewide days on market was about 54. Homes tend to sell faster in high-demand and low-supply environments, and sellers also tend to get close to or above their asking price. In October, sellers accepted 96.9% of their list price statewide compared to 98.0% for the metro. But activity varies widely based on price range, location and market segment, as shown above.

A sustainable housing market depends on employed residents earning a decent wage who are able to meet monthly payments, maintenance and repairs. Rates have come down recently in part due to a slowing labor market. The longest government shutdown on record meant we’ve been flying blind without the latest jobs report and data releases for over a month. As federal employees return to work this week, we expect key economic and housing data to return to schedule soon. Ultimately, the housing market remains “rate dependent,” rates are “Fed and bond market dependent,” and the Fed and bond market are “data dependent.” The latest economic data could make rate cuts more likely. Uncertainty typically generates more demand for safe treasuries and bonds which drives the price up and the yield down. The 10-year yield specifically informs mortgage rates and is one of several indicators to watch moving forward.

NEW(ish)! Interactive maps of statewide prices, market times and sales growth.

For more information on weekly and monthly housing numbers visit www.mnrealtor.com, www.mplsrealtor.com or www.spaar.com

A screenshot of a computerAI-generated content may be incorrect.

All information is according to Minnesota Realtors® based on data from NorthstarMLS and participating MLSs.
Data are deemed reliable but not guaranteed. MNR serves the entire state of Minnesota.
MAR and SPAAR serve the Twin Cities metro and western Wisconsin.