According to the National Association of Realtors, 77% of people nationally believe now is a good time to sell a home.  But how do things look here in the west metro?

National trends in residential real estate include a continued tight inventory of homes along with some price stabilization in home values.  But is that true in the west metro?

Three local trends tell the tale.

Trend 1: Continued Price Strength

Since early 2014, residential real estate prices have been on a steady trajectory upward. Home values and sale prices have gone up significantly. These upticks have been seen across the country but especially in the west metro.

This fall however, the national media has included more than a few stories indicating that price increases may have begun to level out. While there is some dispute as to what is happening nationally, this has certainly not been the case in the west metro. Here price strength has not only held but added to recent gains with solid percentage growth versus last year in median sales price.

 

Median Sales Prices
Oct ’17 vs Oct ‘18

 

Eden Prairie

+3.4%

Maple Grove

+14.2%

Minnetonka

+18.1%

Plymouth

+15.2%

 

The message here is that homes hold their value better in the west metro and despite national headlines, local metrics indicate growth.  These are partially bolstered by new construction, but generally indicate strength across the board. Location matters when looking at trend lines and the west metro has proven time and time again to be one of the more stable real estate investments.

Trend 2: Overall Inventory Lower Versus 2017

Another notable trend nationally has been low inventory in residential real estate with supply trailing demand. This has created a market that is more apt to favor sellers. Here at home this trend has proven to be at least partly true. When compared with 2017 numbers, the total supply of homes in 2018 is down, continuing the longer term trend.

 

Inventory of Homes for Sale
Oct ’17 vs Oct ‘18

 

Eden Prairie

-5%

Maple Grove

-14%

Minnetonka

-12.3%

Plymouth

-9.5% 

 

This is not to say that there are not homes available at all price points, only that total inventory is lower versus  last year. It is not all doom and gloom for weary buyers however.  Those seeking optimistic numbers need look no further than trend #3.

Trend 3: New Listings Up in some West Metro Communities

Despite overall inventory falling, new listings are up double-digit percentages in Minnetonka and Plymouth. This seems to support a longer term easing of the persistent inventory pressures we’ve seen during the recent rise in values. 

 

New Listings by City
Oct ’17 vs Oct ‘18

 

Eden Prairie

0%

Maple Grove

-9.3%

Minnetonka

+10.2%

Plymouth

+12.5%

 

These numbers seem to indicate that fall and winter buyers may be well-positioned in the communities seeing this increased inventory. By choosing to purchase a new home outside of the spring rush these buyers may capitalize early on trends and benefit from some additional inherent advantages to avoiding the hyper-competitive real estate period.

The Bottom Line

While rising rates are something to keep an eye on, the markers of a true real estate bubble do not appear to be forming.  A roaring economy shows no signs of slowing and inventory continues to be moderate.  This tends to point to the fact that a rise in rates can likely be absorbed by the market in the near term with minimal impact to the underlying fundamentals.

Overall the west metro remains the preeminent location for Twin City homebuyers. Home values, inventory and other factors point to an active market in a location where livability continues to rank incredibly high.

Regardless of trends, finding a new home continues to be a highly personal process. Trends still matter, but defining your goals and partnering to meet them matters much more.   No matter where you are in the process, Zach Adams and his team are ready to work hard to identify next steps and serve as subject matter experts to help you along the way. 

A no cost consultation is a great first step.  Contact Zach today at 612.656.9647 to get started.