MINNEAPOLIS, Dec. 19, 2018 /PRNewswire/ -- Today, RE/MAX INTEGRA, Midwest released its 2019 Housing Market Outlook Report providing insight into the latest housing data and trends from 2018 as well as predictions for the housing market in Minnesota for 2019.
RE/MAX INTEGRA, Midwest brokers anticipate Minnesota's competitive sellers' market to continue in most areas of the state in 2019. Although mortgage rates remain historically low, brokers predict with rates expected to climb to 5-6 percent in 2019 that buyer demand may slightly wane.
The median sales price in Minnesota increased 6.1 percent from January through October of 2018 to $277,059 compared to the same time period last year, according to data provided by the Minnesota Association of REALTORS®. The median sales price in the Twin Cities region increased 7.6 percent to $270,000 compared to the same time period last year.
"We are seeing what is being called a tale of two markets. People who wanted to purchase homes in primary markets or large cities are moving outside to tertiary markets and smaller towns, which has put a huge amount of pressure on those markets, causing prices to rise. However, we are seeing a bit of a stall in some primary markets because home buyers are pushing back on urban prices and choosing tertiary markets to get more home for their dollar," said Fiona Petrie, vice president and managing director for RE/MAX INTEGRA US operations. "Homes in Minnesota are overall affordable and the outlook for housing in 2019 is strong. Experts predict we may see a general economic slowdown, but that won't happen until late 2019 or 2020. But real estate is not the protagonist. Buying a home will remain the most stable investment a buyer can make today and into the future."
There are several reasons why the Minnesota market may begin to balance in 2019 in addition to interest rates:
Waning buyer demand due to prolonged lack of inventory
Builders in suburbs and rural areas building more affordable homes
More millennials and homeowners who sell before they find their next home are renting in market-to-luxury rate apartments
RE/MAX brokers added that home prices are increasing at a much slower pace than this time last year, which may cause the market to start to balance out in some parts of the state.
Click here to view the full 2019 Housing Market Outlook Report and also view the attached snapshot of key real estate markets across Minnesota, including new data and insights from RE/MAX brokers.
About RE/MAX INTEGRA, Midwest RE/MAX INTEGRA, Midwest is the regional entity for RE/MAX franchises in Indiana, Minnesota and Wisconsin. Since its inception in 1985, the region has grown to more than 280 offices with approximately 4,100 sales associates, providing residential and commercial real estate, as well as relocation and referral services.