The Minneapolis housing market is unique and is proving to be one of the most resilant housing markets in the country.
The Minneapoils housing market did take its fair share of losses in home values but over the year we have begun to make up ground and currently ranks 3rd out of the 20 cities the S&P/Case-Shiller Home Values Indicies as far as increase in home values on a year over year basis, which shows a 7.4 percent increase in home values.
Why Are Home Values In Minneapolis Increasing?
Minneapolis home values are increasing simply because there is an abundance of home buyers and a lack of home sellers. With the increase in competition home sellers are seeing more offers for their home and these offers are more often than not coming in at the asking price of the home seller.
According to the latest Weekly Market Activity Report from the Minneapolis Area Association of Realtors, new home listings in the Minneapolis metro have decreased by 3.0 percent to 1,037 compared to one year ago. Pending home sales, on the other hand, have increased 11.1 percent from one year ago bringing the months' supply of inventory down 28.8 percent to 4.1.
This combination has pused the median sales price of a home in the Twin Cities up 12.7 percent from one year ago to $174,625, according to the Minneapolis Association of Realtors. Additionally, 94.8 percent of home sellers are recieving their orignal listing price and a home is sitting on the market for an average of 101 days in September.
With mortgage rates near historic lows, the Minneapolis housing market is experiencing a housing affordability index of 235. What this means is, the household income is 235 percent of what is necessary to qualify for a median priced home under current mortgage rates.
Current Minnesota mortgage rates show a 30 year fixed FHA home purchase mortgage at 3.5 percent with no closing costs. On a median priced home in the Twin Cities and with 3.5 percent for a down payment you could expect your monthly principle and interest payment to be in the neighborhood of $756.