Spring Housing Outlook Yields Low Inventory, Higher Interest Rates
The snow on the ground may tell a different story, but if you ask Maple Grove realtor James Holmen, the spring home buying season is upon us.
“The spring market right now is different than it’s been, even just last year,” said Holmen with Keller Williams Classic Realty Northwest. “I mean, everyone’s aware of the higher interest rates. People might not be aware that inventory is historically low.”
Holmen says in the Twin Cities region there’s currently 5,539 homes on the market. According to data from Minneapolis Area Realtors, the rolling 12-month median sales price is $365,000.
“So it’s busy, and it’s busy for the homes that are priced correctly, and that are updated nicely and ready to go,” Holmen said. “But it is indeed different than it’s been in years’ past.”
John Turney’s home in Maple Grove recently went on the market and he says it didn’t take long to sell.
“Yes, it went very quickly,” said Turney. “It was on the market for four days before it went.”
Turney’s home sold at the asking price of $589,900, although he thinks it could have sold for more if the interest rates were lower.
According to Minneapolis Area Realtors, the Twin Cities Region currently has 5,539 homes on the market.
“Anybody who’s going to move into a house like this is going to come from another house, this isn’t a first-time buyer’s house,” Turney said. “So why would you give up a 3 percent mortgage and take on something that’s gonna be a lot higher?”
Realtors say that buyers need to forget about the fact that interest rates were ever that low.
“It surely was not the norm,” said Holmen. “So using a term that I don’t really enjoy — ‘the new normal’ — that we got used to during the pandemic. This is the new normal.”
So for now, it’s not a buyer’s market, simply because there’s not a lot of inventory.
That means home prices will remain high.
“So it’s been tough,” Holmen said. “It’s been a couple months of tough sledding, There’s no doubt. But the future is always bright, and the idea is, buy now and wait, compared to wait and then buy later.”
Related: Twin Cities Home Sales See ‘Staggering’ November Drop
