March 2020 will long be known as the month when the coronavirus pandemic changed everything. The month started with a robust real estate market, which abruptly changed mid-month due to COVID-19 when schools and other public spaces such as dine-in restaurants, theaters and sports/fitness facilities closed. The impact was one of life standing still as we followed the order to #stayathome.
It’s a sign of how strong the month started that new listings were still up 16% compared to March 2019, and pending and closed sales both increased 11.2% year-over-year.
All of this resulted in an 11.1% drop in inventory, a 9.1% drop in days on market to an average of 60 days until sale, and a 0.6% rise in percent of original list price received to 99.2%.
But the real story in March was median sales price, which increased 8% year-over-year, the biggest increase since May 2018. The new median sales price was $297,000, a result of low inventory and high demand.
Months supply of inventory takes into account both the number of homes for sale and the rate at which they are selling. A 5-6 month supply is considered balanced between buyers and sellers. Months supply of inventory continued to be low 1.7 months, with townhomes in shortest supply.
When breaking out months supply of inventory by price range, $150,000-$250,000 had the shortest supply, but it is a seller’s market all the way up to $1M+.
Activity from the first quarter of the year spills over to sales in April and even some in May, so don’t expect a sudden drop due to the coronavirus pandemic. It will be interesting to see the effect in future months. Showings dropped mid-March, but have picked up again… now we have to see the impact of those showings on sales.
The data in this post comes from statistics 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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Sharlene Hensrud, RE/MAX Results – shensrud@homesmsp.com
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