SPAAR in the News: ‘Affordability concerns haven’t gone away’; Median price of a home in the Twin Cities reaches new high

As published by KARE-TV on July 17: Concerns about the affordability of housing persist, with a new report showing that the median Twin Cities metro home price has surpassed $400,000 for the first time.

The median home sale price across Minnesota is $370,000, while in the metro it is $401,000, according to Minnesota Realtors, who put out the report based on data from NorthstarMLS.

Meanwhile, the latest affordability index from Minneapolis Area Realtors fell yet again, due to mortgage rates, which continue to hover just below seven percent.

"We have a (housing) shortage and it's not just in the state of Minnesota," said Jennifer Livingston, President of the St Paul Area Association of Realtors. "One of the biggest challenges we're seeing right now are the people that are locked into the low interest rates. Some at two or 3.5% and they don't want to get rid of that interest rate, so they are not selling their home."

Pending sales have also risen. In June, pending sales rose 3.5% in the metro. Minnesota Realtors say single-family homes took 34 days to sell, townhomes 46 days, and condos 90 days to sell.

Minnesota Realtors say sales of homes under $500,000 were up by $1.2%, while homes between $500,000 and $1 million was up by 18%. Sales over $1 million were up by 12% in June.

“A better inventory picture plus slightly better mortgage rates have been encouraging,” said Patti Jo Fitzpatrick, President of Minnesota Realtors, in a press release. “But affordability concerns haven’t gone away—particularly for first-time buyers looking to break into the market. Realtors can help buyers on a budget get into their first home. Meanwhile, many sellers are finding success getting their desired price.”

In Minnesota, home prices are highest in the metro area. Minnesota Realtors say that is followed by Detroit Lakes, Rochester, and Fergus Falls, while the most affordable regions in the state are Hibbing/Virginia, Willmar and Bemidji. Homes sold the fastest in the metro, Duluth/North Shore and Rochester.

The highest priced areas of the metro were Medina, Orono, Wayzata, North Oaks and Deephaven, Minnesota Realtors say. The most affordable areas were Columbia Heights, Brooklyn Center and South St. Paul.

Note: a similar story on this topic aired with KARE-TV reporter Kent Erdahl interviewing Jennifer Livingston.