October 2022 Market Insights

Key insights from September 2022 (compared to September 2021)*

• New listings: 6,002 | -17.8%
• Median sales price: $362,000 | +6.3%
• Closed sales: 4,860 | -23.9%
• Pending sales: 3,964 | -29.7%
• Days on market: 31 | +34.8%
• Inventory: 9,002 | +0.0%
• Months’ supply: 1.9 | +18.8%

Activity slows as Twin Cities real estate market shifts in buyers’ direction

The long and the short of it

• Median pricing remained high but ticked downward from last month to $362,000.
• The supply of homes for sale jumped slightly compared to last year, with a 1.9-month supply available.
• There is still quite some distance to cover before the market approaches balance between supply and demand.

Sales and listing activity around the 13-county Twin Cities metro continued its steady decline in September, with both new listings and overall sales activity returning to levels more comparable with 2019. But median sales prices remain near record levels.

The median home sold for $362,000 in September, up 6.3% from the same month a year ago. The median price has fallen consistently since June, when it hit $380,000, but remains well above historical levels. Only two years ago, for instance, the median home sale was for just $310,000.

Prices remain high but some metrics are shifting slightly more in favor of would-be buyers. For instance, sellers received 98.9% of their original list price in September, which can indicate less competition between buyers. That’s a 2.3% decrease from September 2021.

While that number may seem discouraging, it’s important to consider what percentage has been normal in our market’s history. Getting just shy of 99% of their listing price is the best our market’s sellers have done every September except two over the past decade, with only the record-setting 2020 and 2021 providing a higher return.

The time homes are spending on the market tells a similar story. In September, the typical home spent 31 days on the market, up 34.8% from September 2021 and up four days from August 2022. That may seem stark, but again consider our market’s history: It wasn’t until 2016 that we saw our first 60-day average, and the fastest average sale we saw in all of 2020 was 37 days.

Those numbers send a message that sellers with a quality home to offer can still find motivated buyers willing to pay a considerable price for their home. But there is also unquestionably less activity on the market overall.

In September, just 4,860 sales closed, down 23.9% from September 2021. Sales for the year to date are now at 42,878, down 13.6% year-over-year.

Fewer homes are also hitting the market for sale. There were 6,002 new homes listed for sale in September, a 17.8% drop from the same month last year. New listings have only been up month-over-month once this year, in May.

Buyers should be encouraged as the market continues to shift in their favor. The inventory of homes for sale has risen to 9,002, up a handful from September 2021. This is just the third time over the past two years that more than 9,000 homes, a 1.9-month supply, have been listed for sale. A balanced market has a 6-month supply, and as more homes are listed, prices generally decrease and competition for homes eases.

Mortgage rates will continue to play a role in buyer and seller decisions, with rates hitting 6.9% near the end of the month.

Economic check up

• Minneapolis-St. Paul area unemployment rate: 2.1% (as of August 2022)
• Average rates for 30-year conforming mortgage 6.92%**
• Interest rates haven’t been at 7% or higher since 2002, according to Freddie Mac.

Ready to help

We are here to help you confidently navigate your housing needs, now and always. Whether you are researching future options or your circumstances require immediate action, reach out to an Edina Realty agent today for guidance.

*Data courtesy NorthstarMLS for the 16-County Twin Cities metro area for September 2022.

**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 % changes are year-over-year.

Alexandria Area

• New listings: 101 | -24%
• Avg. sales price: $366,268 | +23%
• Pending sales: 87 | -30%
• Days on market: 38 | +9%
• Inventory: 176 | -19%
• Months’ supply: 2.0 | na

Brainerd area

• New listings: 591 | -5%
• Avg. sales price: $373,000 | +18%
• Closed sales: 632 | -1%
• Days on market: 33 | +14%
• Inventory: 1,117 | +15%
• Months’ supply: 2.4 | +20%

Lake Superior area

• New listings: 369 | -10%
• Avg. sales price: $282,427 | +4%
• Pending sales: 413 | -5%
• Days on market: 24 | na
• Inventory: 750| +12%
• Months’ supply: 2.5 | +32%

Southeast Minnesota area

• New listings: 565 | -14%
• Avg. sales price: $289,556 | +1%
• Closed sales: 561 | -9%
• Days on market: 31 | +29%
• Inventory: 944 | +13%
• Months’ supply: 1.9 | +27%

St. Cloud area

• New listings: 145 | -25%
• Avg. sales price: $270,369 | +2%
• Pending sales: 111 | -37%
• Days on market: 27 | +23%
• Inventory: 222 | +1%
• Months’ supply: 1.6 | +23%

Mankato area

• New listings: 180 | -17%
• Avg. sales price: $257,848 | +8%
• Pending sales: 154 | -10%
• Days on market: 65 | na
• Inventory: 298 | na
• Months’ supply: 1.7 | +6%

Northwestern Wisconsin area

• New listings: 469 | -28%
• Avg. sales price: $302,889 | +9%
• Closed sales: 536 | -7%
• Days on market: 69 | -3%
• Inventory: 1,504 | -21%
• Months’ supply: 3.1 | -14%

West Central Minnesota area

• New listings: 285 | -19%
• Avg. sales price: $208,792 | +9%
• Pending sales: 233 | -28%
• Days on market: 43 | +16%
• Inventory: 582 | -2%
• Months’ supply: 2.4 | +9%

Bemidji area

• New listings: 52 | -37%
• Median sales price: $250,500 | +23%
• Pending sales: 51 | -26%
• Inventory: 124 | -5%
• Months’ supply: 2.3 | +5%

Leech Lake and surrounding area

• New listings: 77 | -4%
• Median sales price: $289,450 | -7%
• Pending sales: 66 | -22%
• Days on market: 27 | +286%
• Inventory: 140 | +13%
• Months’ supply: 2.7 | +23%

Little Falls area

• New listings: 26 | -7%
• Median sales price: $221,000 | -8%
• Pending sales: 24 | -14%
• Days on market: 9 | -31%
• Inventory: 28 | -18%
• Months’ supply: 1.3 | -7%

Southwest Minnesota area

• New listings: 89 | -26%
• Median sales price: $170,850 | +12%
• Pending sales: 93 | -26%
• Days on market: 43 | +7%
• Months’ supply: 2.4 | +20%

Headwaters area

• New listings: 119 | -13%
• Median sales price: $237,500 | +9%
• Pending sales: 102 | -16%
• Days on market: 33 | +22%
• Months’ supply: 2.9 | +26%