Twin Cities Housing Market Update July 2024
Inventory of Homes for Sale Grew in June Even as New Listings Dropped Off
While the number of new homes listed for sale dropped in June, the start of the seasonal slowdown in real estate market offered Twin Cities home buyers more choices as the inventory of homes for sale grew.
It’s July and in Minnesota that means fireworks, festivals, and lazy days at lake cabins. It also means a slowing down of the Twin Cities housing market. Minnesota’s real estate market typically follows a seasonal pattern, and this year is no exception.
In this month’s market update, I’m going take a bit of a different tack and look just at the four trends that pretty much encapsulate this housing market. Stick around to the end of this video where I talk about the one thing that could buck the seasonal pattern this fall.
Few New Homes Listings
The number of new homes listed for sale usually peaks in May and begins to drop off in June. And that’s just what happened here. The number of new homes listed for sale in June fell off, from 5,861 in May down to 5,286 in June. Which is pretty typical.
However, the number of new listings was also down a little more than 5 percent from last year. That continues a trend we’ve seen for the past three years, as you can see in this slide. The number of new listings in June was also the lowest for June in at least the past decade.
Inventory Grow as Summer Market Slows
Interestingly, though, even as the number of homes listed for sale has shrunk, as we have for much of this year, seen the total number of homes for sale grow. The total number of homes for sale in the seven county metro was actually 11.5 percent higher in June compared with last year.
There were 175 more homes on the market in June than in May. So fewer homes came on the market in June, but there more homes for sale.
Number of Closed Sales Down 16.2% in June
And we can see why in the number of closed sales in June. The number of closed sales fell 16.2 percent in June compared to June of last year. So buyers are joining sellers on the sidelines. Maybe they’re waiting for interest rates to come down, or for prices to fall, or maybe this election year is just creating a lot of uncertainty.
Because inventory doesn’t seem to be the issue right now. There were more homes on the market in June than last year—in every price bracket. That includes the under $300,000 price range, which saw a 26 percent increase in the total number of homes for sale year-over-year. First-time homebuyers take note.
Home Sale Prices Remain Largely Flat Through Spring
The last thing I want to touch on is home prices, which area also subject to a little seasonal swing. But when you look at the median sale price averaged over the past 12 months, what you see is a flat line. From April through June, the median sale price has stayed consistently at $375,000.
That’s $5,000 higher than it was in January and $10,000 higher than it was in June 2023. Home price have risen 2.7 percent since last year, which is pretty modest compared to the Covid years. I think the important thing to note here is that despite slowing home sales, home prices overall haven’t really come down.
Could an Interest Rate Reduction Ignite the Market this Fall?
So what might shake up the housing market this fall? Just this morning, the news media was reporting that inflation was down again in June and there was (again) speculation that the Federal Reserve Board may finally pull back and cut interest rates at its end of July meeting. Certainly any interest rate cut would be welcome news for homebuyers, but will it be enough to light a fire under the market. I guess time will tell. But I wouldn’t hold my breath
J Trout Lowen is a Minneapolis REALTOR®. She helps home buyers and home sellers navigate the Twin Cities housing market. You can reach her at trout@JTroutLowenRealty.com