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January 2026 Housing Market Report

By MNR News posted 5 hours ago

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Sluggish Sales Start the Year
Key Updates: Seller and buyer activity slowed across the state and metro in January, according to new data from the Minnesota state and Twin Cities metro REALTOR® Associations.

New listings fell 9.0% statewide and 10.8% in the Twin Cities.
Signed purchase agreements (pending sales) fell 11.4% statewide and 12.9% in the metro.
The median sales price increased 1.5% statewide and 1.4% in the metro.

Sellers, Buyers and Housing Supply

A blast of arctic air chilled Minnesotans and the housing market in January. Beyond the typical winter housing market slowdown, other factors including extreme cold, economic anxiety, and federal enforcement activities may have left buyers and sellers hesitant to move forward and therefore postponing major purchases like houses, cars, or appliances.

New listings declined 9.0% statewide and 10.8% in the metro. The declines were fairly consistent across all price points, but the most notable declines were in the condos and new construction segments. Pending sales fell 11.4% statewide and 12.9% in the metro. The declines in demand showed more variance, with the strongest declines appearing in the most affordable properties. The $700-900K range was one of the only sectors with more signed purchase agreements than last year. Inventory levels remained flat. Forty-three fewer homes were on the market than last January, marking just a 0.3% decrease in active listings. Inventory levels were up 14.9% in May but by year-end, were up only slightly.

These declines in buyer and seller activity come at a time when inventory levels are near a six-year high, and mortgage rates are close to a 3-year low alongside more moderate home price growth. It’s clear there are non-market factors in play. What’s less clear from the data is exactly what factors are contributing to the slowdown and impacting the decision to buy and sell homes. Twin Cities metro pending sales in January hit their lowest level for any month of any year since December 2007 and their second lowest overall level since at least 2005. Mortgage rates averaged 6.1% in January—the lowest level since September 2022.

“While conditions were difficult to start the year, there is plenty of pent-up demand to sell and buy property,” said Wendy Uzelac, President of Minnesota Realtors®. “We’re in a market where sellers should be realistic and price their homes competitively, but they should also know that any improvement in interest rates or the economy could open the door for more buyers and activity.” First-time buyers face the biggest hurdle while move-up buyers and downsizers aren’t as squeezed.

Market segmentation

There were key differences between market segments across the state:

Sales under $300K were down 18.2% while sales over $1M declined 12.6%
Single-family sales fell 14.9%; condo sales were down 22.6%; townhome sales declined 9.8%
Previously owned home sales were 15.1% lower while new construction sales decreased 13.4%
Two-bedroom home sales fell 12.4% while four or more-bedroom home sales declined 12.3%
Non-waterfront sales were down 15.0% while private waterfront sales softened 5.2%
Sales were down 31.3% in Minneapolis and decreased 13.7% in St. Paul

Prices, Market Times and Negotiations

Home prices continued to trend higher both statewide and, in the metro, with the state median price rising 1.5% to $335,000 and the metro median rising 1.4% to $375,000. Yearoveryear price growth at a time when affordability is stretched for many households partly reflects the ongoing supply deficit, more move-up buyers with equity, fewer first-time buyers and more luxury activity. But every area, price point and market segment is unique. Some listings are getting multiple offers in a few days and selling for over list price, while others are being discounted or lingering on the market. On average, sellers accepted offers at 96.0% of list price statewide and 96.8% in the metro—both up from last year and both at their highest January level since 2022. Offers were accepted after an average of 56 days on market statewide and 66 days in the metro—both flat or down slightly from a year ago. “We saw a challenging start to the year, and affordability continues to be a key issue," said Aarica Coleman, President of Minneapolis Area REALTORS®. “In this environment, preparation and strong professional guidance make a meaningful difference for buyers navigating limited inventory and pricing pressure.”

Sellers across the state also had to be more patient as market times rose 5.4% while homes in the metro sold 4.5% faster than last January. “A slower market can mean incredible opportunities for some buyers,” said Danielle Bickham Pelton, President of the Saint Paul Area Association of REALTORS®. “It’s true that patience is key but it’s also true that buyers should move quickly and confidently once they find ‘the one.’”

The latest economic data around inflation and job growth came in stronger than expected. That bodes well for the housing market, assuming it continues and interest rates cooperate. And as our state recovers from a challenging start to 2026, the hope is for improvement in the months ahead. It will take a few more months of data to determine if a sluggish January was an aberration or a trend.

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

A screenshot of a chart outlining Jan. 2026 Housing Market Activity compared to the year before

Jan. 2026 Mapped | Exploring Spatial Market Trends

(Click on button to view desired map!)

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.