Home prices ticked higher statewide but were flat in the metro. The statewide median sales price rose 1.4% to $350,000 while the metro median price held steady at $380,000. Higher inventory along with fewer sales meant less competition and less upward pressure on home prices. That softening, combined with many buyers who are less willing to make aggressive offers means prices continue to recalibrate to today’s market conditions. It also means sellers should continue to adjust their expectations.
Sellers accepted a smaller share of their list price to meet buyers where they are. Sellers who did accept offers in March obtained 0.5% less of their asking price compared to last March (98.1% vs. 97.6%). And they had to be more patient before accepting those offers. Homes statewide sold in an average of 70 days while metro homes spent more like 62 days on market—both up 5-10% from a year ago. But as usual, these two indicators vary widely across segments and neighborhoods. “As sellers adjust, the challenges from January and February still reverberate across the Twin Cities community—and Minneapolis in particular,” said Aarica Coleman, President of Minneapolis Area REALTORS®. “With affordability still top-of-mind, it’s important to remember that other factors remain a concern for some households.” Those factors can range from public safety to labor-related new construction delays or the decision to withhold a listing.
“The fact that mortgage rates touched 5.9% in February—a key psychological level for consumers—makes the higher rates arising from the Iran conflict that much more frustrating," said Danielle Bickham Pelton, President of the Saint Paul Area Association of REALTORS®. “The hope is that these pressures will ease and rates will continue to soften, which would be ideal for the spring and summer market.”