4 Reasons the Twin Cities Housing Market is Red Hot Right Now!
It may come as a shock to hear that the housing market in the Twin Cities is red hot right now. Especially since 2014 was a pretty flat year and companies like Renters Warehouse are running ads telling you how bad things are right now. This couldn’t be further from the truth! What I’m seeing on the ground locally, is an inventory shortage and multiple offers all over the place! I'm working day and night to get buyers in to see new listings as soon as they come on the market! Here are the largest 4 contributing factors to this market as I see them.
1: The Winter
While some parts of the country have had really rough winters. The east coast for example has seemingly been hit by an unending run of storms. The Minneapolis / St Paul area has had a refreshingly light winter. It’s currently the 16th of March and feels like the middle of May! Weather plays a large role in the housing market here because when its bad weather it’s hard to show homes! Which means less homes in multiple offers, longer days on market etc. I haven’t had to cancel appointments or open houses because of bad weather more than 1 time this winter. Which is way less than normal. The spring market is here much earlier than normal!
FHA (The Federal Housing Administration) decreased its mortgage insurance rate significantly. Which increases the affordability of housing, especially in the under 250k market. Also, the conventional lenders are finally loosening some of their lending requirements. They are also coming out with new offerings that make the buyer’s job of finding a home easier. More bridge loans, rehab loans and lower down payment options etc. This is all good news, now they just need to not get carried away with the easy money like last time.
3: Interest rates
Interest rates are very close to historic lows and are below last year. They are currently averaging 3.86 down from a year ago at 4.37. This increases home affordability. Also, the speculation that the fed will be raising interest rates in the near future is encouraging buyers on the fence to make a move sooner before rates rise.
4: The Local Economy
The economy in Minnesota is doing comparatively well, and currently has an unemployment rate of only 3.7%. With the glaring exception of the recent Target layoffs, more people are back to work and finally feeling confident enough for a home purchase. Here is an article from the Atlantic that is sure to stroke your ego if you live in the area.
Why do you think the market is so hot right now?
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