The seasonal spring market is exceptionally robust in Minnesota, and is the best time of year to sell a home. And now is about the time sellers start thinking about it! But before sellers make their decision, they often want to know the answers to these questions:
What is the overall health of the market? How is my city and area performing compared to the overall market? And what can I expect from this year’s spring market? To find these answers, we need to take a quick look back at 2020, and the impact of the pandemic on the housing markets here. Let’s get started!
2020 ANNUAL HOUSING REPORT
Fortunately, real estate professionals in the Twin Cities have access to the best statistical analysis and reporting in the country through our professional association, the Minneapolis Area Association of Realtors (MAAR).
Each year, the Association puts out a year-end report to track the performance of the Twin Cities housing market on key metrics, including median price, monthly supply of inventory, and foreclosure rates. Best of all, these statistics are broken down by county and city, so that customers can get a more specific read on their local market conditions.VIEW ANNUAL REPORT
In 2020, the Twin Cities housing market started off with the shock of the (early) global pandemic, which contracted sales and buyer activity almost immediately. Although buyers and sellers had already adjusted to the new reality of COVID by late spring, listing activity and overall inventory never fully recovered, setting up what we call the “pandemic bubble.”
Buyer activity soared, as more people sought to hunker down and work from home in single family housing. And fiscal stimulus and low mortgage rates converged, sending demand even higher.
This imbalance between supply and demand pushed Twin Cities housing sales up 10%, and median price up 10%, from just a year earlier in 2019. Edina benefitted greatly from the national disruption in urban markets, as more households left the urban core in cities like Minneapolis and returned to first-ring suburbs like Edina.
Edina median price rose to $520,000, a 10% increase from 2019, and a 20% increase from 2016! Premier Edina neighborhoods like Arden Park, Country Club, Minnehaha Woods, and Parkwoods Knolls also saw significant increases in luxury home sales, especially above $1.5 million (see Edina Neighborhoods Page).
2021 MARKET PREDICTIONS
The 2021 spring market begins, as it did last year, with a global pandemic still lingering. With surging suburban single family home demand, constrained supply, and continued historically low interest rates, the pandemic bubble is sure to continue, with sellers the primary beneficiaries.
We believe that Minnesota’s economy has the best chance of a V-shaped recovery in 2021, given its nationally low infection rates, aggressive mitigation strategies, and diverse economy, and expect the second half real estate market to continue its sharp upward progression.
Listings that are more prepped and staged for a virtual marketplace will do the best, which we explain in our recent article on What the Pandemic Means for Your Real Estate, along with the some real-life examples in the follow-up article on What the Pandemic Means for Your Real Estate II.
As always, if you have questions about your own home’s market value, or are looking for ways to spruce up your home for the highest return on the market, feels free to contact us for a free walkthrough!