February 2021 Market Insights

Key insights from January 2021 (compared to January 2020)*

• New listings: 3,989 | -8.8%
• Median sales price: $301,000 | +11.5%
• Closed sales: 3,335 | +14.6%
• Pending sales: 3,519 | +5.6%
• Days on market: 42 | -37.3%
• Inventory: 4,823 | -42.6%
• Months’ supply: 0.9 | -47.1%

No home sales slowdown in January means tight market for buyers, headwinds for sellers

The Twin Cities real estate market remained increasingly friendly for sellers as it kicked off a new year, with total sales and median pricing both shooting upward and inventory and time on the market dwindling.

In all, 3,335 sales closed in January, a 14.6 percent increase over January 2020’s pre-COVID sales market. The market has seen more January sales each year since 2018, when activity started picking back up.

Sales don’t appear ready to slow down in February. 3,519 transactions were pending at the end of January, a 5.6 percent increase over the same time last year.

The fervent buyer activity has led to an increase in median sales prices. The median price in January was $301,000, up 11.5 percent from January 2020’s median price of $270,000, which had been the January record. The market has posted median prices of $300,000 or higher every month since June of last year, a significant milestone in a marketplace which hadn’t previously seen a single month with that median price.

Sellers in January received 99.5 percent of their original list price, with the typical property spending just 42 days on the market before selling. The latter is a massive 37 percent drop from January 2020, but is notably up by a week from the market-low 34 days measured in November.

The data paints a flattering picture for sellers, who are able to place their homes on the market and, with few exceptions, sell quickly and for a price that meets their goals.

Buyers, on the other hand, may find it more difficult to complete their process quickly. Many buyers are involved in bidding processes for several properties before finally landing their dream home, and in some cases may pay more than they had planned.

As of Jan. 31, just 4,823 properties were for sale. That’s down an amazing 42.6 percent from the same point in 2020, and about a .9-month supply. A balanced market typically has about a six-month supply of homes for sale.

The low inventory is unquestionably an issue for the market to address. Prior to 2020, a tight market historically was something in the 8,000-9,000 range. For context, in January 2016, there were around 11,000 homes for sale, and five years before that, there were closer to 25,000 homes for sale.

New listing activity in January was down 8.8 percent, with just 3,989 homes hitting the market. It will be interesting to see if the post-Super Bowl spring market brings a significant influx of new product for sale, although Edina Realty president Sharry Schmid has predicted that a major increase in inventory won’t come in 2021.

Economic check up

• Minneapolis-St. Paul area unemployment rate: 4.5% (as of December 2020)
• Average rates for 30-year conforming mortgage 2.73%**
• Extremely low interest rates continue to offer exceptional buying and refinancing opportunities.

The long and the short of it

• Inventory of homes for sale is now under a one-month supply, the lowest in recent memory.
• Properties are selling for 99.5 percent of their original asking price and in just over a month after hitting the market.
• The effect of COVID-19 on seller confidence continues to impact the housing market. See how Edina Realty is working to keep you safe during COVID-19.

Ready to help

We are here to help you safely and confidently navigate your housing needs, now and always. We have options to assist you through innovative technology and by using diligent safety precautions. Whether you are researching future options or your circumstances require immediate action, reach out to an Edina Realty agent today for guidance. Your wellness and safety continue to be our top priority.

*Data courtesy NorthstarMLS for the 16-County Twin Cities metro area for January 2021.

**Data sourced from Freddiemac.com for informational purposes only. Please contact your mortgage consultant for any questions related to specific loan transactions.

Where you live

Edina Realty serves locations across Minnesota and western Wisconsin. Here’s a look at the market indicators where you live. All percent changes are year-over-year.

Alexandria Area

• New listings: 52 | -37%
• Avg. sales price: $237,430 | +15%
• Pending sales: 52 | -2%
• Days on market: 59 | -80025
• Inventory: 119 | -63%
• Months’ supply: 1.1 | -66%

Brainerd area

• New listings: 253 | -22%
• Avg. sales price: $252,149 | +21%
• Closed sales: 309 | +29%
• Days on market: 58 | -31%
• Inventory: 506 | -65%
• Months’ supply: 1.0 | -70%

Duluth area

• New listings: 164 | -34%
• Avg. sales price: $222,839 | +24%
• Closed sales: 220 | +37%
• Days on market: 64 | -12%
• Inventory: 584 | -44%
• Months’ supply: 1.6 | -52%

Southeast Minnesota area

• New listings: 334 | -7%
• Avg. sales price: $249,677 | +7%
• Closed sales: 352 | +10%
• Days on market: 58 | -18%
• Inventory: 476 | -57%
• Months’ supply: 0.9 | -57%

St. Cloud area

• New listings: 108 | -24%
• Avg. sales price: $223,211 | +12%
• Pending sales: 107 | +7%
• Days on market: 42 | -34%
• Inventory: 144 | -57%
• Months’ supply: 0.9 | -59%

Northwestern Wisconsin area

• New listings: 289 | -15%
• Avg. sales price: $221,915 | +10%
• Closed sales: 314 | +16%
• Days on market: 112 | -20%
• Inventory: 1,191 | -38%
• Months’ supply: 2.2 | -44%

West Central Minnesota area

• New listings: 184 | -7%
• Avg. sales price: $173,370 | +30%
• Pending sales: 187 | +23%
• Days on market: 72 | -22%
• Inventory: 511 | -47%
• Months’ supply: 1.9 | -54%

Bemidji area

• New listings: 33 | +6%
• Median sales price: $174,000 | -15%
• Pending sales: 38 | +36%
• Inventory: 53 | -57%
• Months’ supply: 0.9 | -61%

Leech Lake and surrounding area

• New listings: 18 | -36%
• Median sales price: $240,500 | +58%
• Pending sales: 19 | +6%
• Days on market: 78 | -14%
• Inventory: 60 | -67%
• Months’ supply: 0.9 | -76%

Little Falls area

• New listings: 16 | -30%
• Median sales price: $150,000 | 0%
• Pending sales: 15 | +7%
• Days on market: 18 |-62%
• Inventory: 18 | -64%
• Months’ supply: 0.7 | -68%

Southwest Minnesota area

• New listings: 65 | +2%
• Median sales price: $156,375 | +32%
• Pending sales: 67 | +20%
• Days on market: 85 |-25%
• Months’ supply: 2.3 | -44%

Headwaters area

• New listings: 52 | +17%
• Median sales price: $187,500 | +7%
• Pending sales: 60 | +36%
• Days on market: 80 | +7%
• Months’ supply: 1.0 | -72%