Twin Cities stats for April 2016 continue the same tale… the real estate market is being driven by a low supply of inventory. New listings were only 2.0% behind last April, but closed sales were up 6.1%.
That, combined with decreasing days on the market means the supply of homes for sale is being sold quicker than it is being replenished. The months supply of inventory is only 2.6 months… a strong seller's market.
This shortage of inventory is even more dramatic when you look at months supply (how long it would take to sell everything at the current rate) change from last year by price range.
All price ranges below $250k are down 30-40% compared to last year… and all at months supply less than 2 months. It should come as no surprise than homes in this price range often have showings within hours of hitting the market and sell quickly, frequently with multiple offers. Homes priced $250k-$500k are also still in a seller's market with months supply at 2.6 and 4.2. Only price ranges over $500k are in a buyer's market, but even those ranges have a lower months supply than last year.
Good news for sellers is that because of the laws of supply and demand median sale price has risen to $231,500 and homes are selling for an average of 98% of list price.
These are all signs of a healthy housing market… low inventory is supportive of rising prices so dangers of another housing bubble aren't the same as they were in 2006-2007. Low unemployment rates and rising rents are encouraging more first-time home buyers to enter the market, and low interest rates are keeping homes affordable in spite of rising prices.
Bottom line is we need more sellers to supply the many eager buyers searching for homes!
The figures above are based on statistics for the combined 13-county Twin Cities metropolitan area released by the Minneapolis Area Association of Realtors.
Never forget that all real estate is local and what is happening in your neighborhood may be very different from the overall metro area.
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