While many homeowners plan to sell in the spring, recent years show that the winter market remains competitive as motivated buyers and sellers work to get to the closing table. We’ve analyzed our local market to offer insights you can use as you determine if you should sell your Minnesota or western Wisconsin home this winter.
A snapshot of our local market
First, let’s look at what home sellers are experiencing across our 13-county metro area. According to the Minneapolis Area Association of REALTORS® (MAAR), local home prices have been on the rise since March 2013. In December, metro-area homes sold for a median price of $251,000 — a year-over-year increase of nearly 6 percent.
Price gains for “average” homes in our area are moderate but slowing and we are unlikely to see double-digit increases again soon. If you have a home in this market segment, you may earn as much if you sell this winter as you would if you waited until spring.
Selling a waterfront home this winter
Twin Cities lakeshore homeowners may find that high demand helps them to sell their homes in record time. Even in November and December, when lakeshore home sales tend to drop, private waterfront homes in our 13-county metro area sold in under three months. That’s the lowest median time on market in the ten years of data we have on hand.
Prices for these homes have remained steady for the last year. Twin Cities private lakefront and riverfront homes have remained in the median price range of $385,000 - $398,000 for the last year. In December, the median home price of a waterfront home in the metro area was $392,500.
The lesson? Prices may rise again this spring, but the current demand of waterfront homes means that homeowners who sell now may see a fast closing and a fair price.
Selling a luxury home this winter
Luxury home sales prices have taken a slight dip since last year; the average price of a Twin Cities metro luxury home has remained at $625,000 for the last five months. The inventory of these homes on the market has also decreased slightly, by 2 percent. However, a steady stream of motivated buyers has led to luxury sales increasing 14 percent over December 2015. Plus, sellers are seeing an average of nearly 97 percent of the asking price recouped at closing.
Let’s translate that data. If you’re looking to sell your luxury home this winter or even this spring, you may not earn much more than you would have selling last year. However, you will likely encounter motivated buyers who are willing to pay a fair price as they navigate relatively low inventory in their price range. Local data shows that luxury homes are selling in a median of just 76 days, which is the lowest timing we have seen in 18 months.
Selling a starter home this winter
While our entire local market is showing relatively low inventory, starter homes — or those priced under $250,000 — are the most limited in supply. If homes in this segment continue to sell at their current pace, we would have a supply of only 1.8 months across our 13-county area. This puts us in a clear “sellers’ market” for this segment. Read more insights on what makes a sellers’ market.
The inventory of starter homes dropped 26 percent year-over-year in December, so first-time homebuyers desperately need more starter homes to come on the market this winter. In fact, these motivated buyers are paying nearly 99 percent of the listing price at closing – meaning that home sellers are likely receiving serious, well-priced offers and may even be seeing multiple bids.
If you’ve been thinking of moving to a larger home, this winter may be a great time to sell your starter home and move up.
What happens next?
We’ve broken out a few different market segments, but each home is different. Homes on the same block may even have vastly different values and conditions. Edina Realty has 2,500 local experts covering every city and suburb across Minnesota and western Wisconsin. We’d love to put you in touch with a specialist who can evaluate your home’s current value and likelihood of selling this winter.
Request a free (and obligation-free) analysis of your home’s value today.
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