Minnesota Housing Market Predictions 2019

Minnesota housing market
Minnesota was the 32nd state admitted to the Union. It was formed from the eastern portion of the Minnesota Territory back in 1858. Known for its lakes, cold weather, and its down-home Midwestern “Minnesota Nice,” there is plenty to love here.

The Land of Ten Thousand Lakes has a lot of things going for it. Minnesota is the 22nd most populous state in the country. It is often cited as one of the healthiest states in America. Residents enjoy a longer life expectancy, get more exercise, and have better health insurance than many parts of the country.

No wonder the people living there have a characteristic niceness.  Sure, they may have to endure low temperatures during the winter, but they also enjoy low unemployment and a low number of work-related fatalities. Plus, all the cold and snow turn the state into a winter wonderland. Just don’t ask how long winter is sticking around for.

Predictions for the Minnesota Housing Market in 2019

But the question on everyone’s mind, much more so than the length of winter, is ‘what is the state of the Minnesota housing market in 2019?’ Is it as robust and healthy as its citizens? Or are the cold temperatures about to make the market sick?

Closed sales are down 6% from 2017 to 2018, with pending sales down 4%. The good news is that both prices and percent of list price improved from 2017. Homes in Minnesota also continue to appreciate in value, but at a rate slightly lower than the national average. Data collected on home appreciation values over a five-year period from 2012 to 2017 show that homes appreciated by 37.4% across the country, and by 31% in Minnesota.

According to Zillow, the median home value in Minnesota is $225,210. This means that the value has increased by 8.2% over the past year, and Zillow predicts that value will rise 4.9% within the next year.

Zillow gives the Minnesota housing market a rating of “very healthy,” and sites that homes spend an average of 91 days on Zillow, and less than 1% of Minnesotan homes are delinquent on their mortgages.

Influencing Factors in the 2019 Minnesota Real Estate Market

The site Zillow also says that foreclosures were a factor in the 2018 Minnesota housing market. Though delinquent mortgages in Minnesota are below the national average, 1.7 homes per 10,000 are in foreclosure, and 8% of Minnesotans are underwater on their mortgages.

Inventory remains the biggest factor for the Minnesota housing market. From December of 2016 to December of 2017, inventory was down 27.5% making it the lowest for the Minnesota housing market since 2004.

It’s a seller’s market for sure in the land of lakes. With fewer new listings on the market, supply remains low as demand remains high, helping to raise home prices.

This shortage of inventory also means that retirees and first-time buyers compete for the same short supply of townhomes. That means that not only will the supply of homes be important to watch in 2019, but also the available price ranges.

Mortgage rates across the country will also play a prominent role in the 2018 housing market. Experts expect rates to reach 5% by the end of the year, which will affect what buyers can afford. This may lead to a decrease in the median sale price, but experts do not worry since it still falls way below the 8% mortgage rates of the recent recession.

What Are the Best Places to Live in Minnesota?

Nearly 60% of Minnesotans reside in the Twin Cities metropolitan area. This includes Minneapolis, the most populous city in Minnesota, the capital city of St. Paul, and the surrounding suburbs.

Both St. Paul and Minneapolis are highly livable cities with affordable median sale prices that continue to rise steadily. Residents can enjoy several art museums, fine dining, a burst of new and innovative brewpubs, and plenty of biking trails and outdoor activities.

Forbes Magazine also recently voted Minneapolis as the number one healthiest city in America due in part to the city’s commitment to exercise, and their embracing of bike trails.

The Twin Cities Metropolitan area is the 13th largest metro area in the country. In addition, there are 17 cities in Minnesota with populations above 50,000 people. The Southern suburbs of the Twin Cities, like Lakeville, benefit from high-performing schools, a stable and steadily increasing housing market with a median listing price of $430,000, and close proximity to the big cities.

It’s Still a Seller’s Game in the Minnesota Housing Market

The Minnesota housing market for 2019 will continue steady growth in median sale prices. However, it will have to battle declining inventory and foreclosures that occur above the national level. Sellers can rejoice in the abundance of demand and the sweetness of short supply. They can expect their home to be on the market, or on Zillow, for roughly three months.

Expert Predictions for the Minnesota Housing Market 2019-2020

2019 Minnesota Housing Market 

Are you intending to purchase your first home in 2019? Congrats! Homeownership is an important goal for some individuals. Finding the right house doesn’t have to be a stressful chore. It can be fun!  However, it is smart to do your homework before you begin shopping. Are costs going up or down? Are most houses selling rapidly or are there housing units remaining available for some time? Consider where to search for your future home and when is the right time to do so. 

Understanding a Seller’s Market 

For as far back as quite a long while, the Minnesota housing business sector has favored dealers. This pattern is known as a seasonally tight market since more purchasers are keen on a similar sort of houses and vendors profit by the challenge. 

Sponsorship 

Various components affect housing prices. Several of these include stock (the number of houses recorded available to be purchased), the number of purchasers who are on the market, demand, and home loan financing costs. In 2018, fewer home postings implied that there was a good demand. Financing costs kept on rising, making the expense of possession higher when you think about the life of the credit. 

Specialists foreseeing a general log jam in the expansion of offer costs in late 2019 going into 2020. In the event that stock expands and more development happens, it could help make home prices more reasonable. 

Taking a Guess at the Future 

Things being what they are, will 2019 keep on being a seasonally difficult market in Minnesota? Undoubtedly, the appropriate response is still yes. From January to October of 2018, the middle (or normal) deal value rose 6.1%. That implies the normal home evaluated at $200,000 in January would have been valued at $212,200 in October, in light of market patterns. 

Constrained Development and Rising Costs

Constrained development in years earlier assumes a job in the rising costs. With the lessening in the supply of houses in the Twin Cities comes an expansion in the cost of the accessible homes. Moreover, as indicated by RentCafé, the normal lease for condos in Minneapolis has risen 5% contrasted with 2018. Every one of these signs points to a higher normal typical cost for basic items for Twin Cities inhabitants. Nonetheless, the uplifting news at purchasers is that costs are beginning to balance out after this time of home cost increments. 

In spite of the fact that the economically difficult market pattern may mean it requires some additional investment to locate the correct home, your understanding will satisfy. Give yourself some additional time by beginning your hunt prior, and consider investigating neighborhoods with lower normal home estimations. 

Minnesota Housing Market: Final Review

All things considered, as indicated by HousingWire.com, “the lodging business sector is headed toward a moderate begin, as 15% of U.S. postings encountered a value cut in January. Realtor.com Chief Economist Danielle Hale said the U.S. lodging business sector is headed toward a slower begin this year in numerous business sectors, contrasted with the quick speeding up found in January 2018.” So, in case you’re shopping now, this might be a decent time to snatch a house while it’s at a lower value point! Remember that winter is ordinarily the best time to purchase a house in MN and once it defrosts, the market turns out to be increasingly focused for purchasers. 

The fantasy of homeownership is feasible, particularly for those in the Habitat for Humanity Homeownership Program. Regardless of if the market favors purchasers or vendors, you can achieve your objective of owning a home by shopping brilliant—with tolerance and industriousness.