September 13, 2012 by Sarah M
// By Sarah McKenzie //
Housing inventory levels in the Twin Cities are at their lowest level in nine years, and the downtown and Northeast housing markets are no exception, according to the latest report from the Minneapolis Area Association of Realtors.
The latest market update, which reflects August sales activity, shows that the supply of houses and condos on the market in the downtown area is down more than 47 percent compared to the same time last year.
In Northeast, inventory is down nearly 25 percent.
“With inventory levels nearing 10-year lows, buyers are scrambling to find the perfect house,” said Cari Linn, president of the Minneapolis Area Association of Realtors (MAAR). “The next step of the recovery will be getting hesitant and distressed sellers back into the market.”
Sales were also up in downtown and Northeast, consistent with trends across the Twin Cities.
In downtown neighborhoods, there have been 386 sales to date — up nearly 25 percent from last year. In Northeast, sales are up nearly 7 percent with 295 closed sales to date.
While overall the Twin Cities housing market has seen median sales prices increase — up 15 percent compared to last year — the median sales price in the downtown neighborhoods has declined by roughly 22 percent (from $270,000 last year at this time to $210,000). The median sales price in Northeast, however, has increased by 6.4 percent — jumping from $132,750 to $141,250.
The median sales price for the entire Twin Cities market is $179,000, the sixth consecutive month it has increased. Foreclosures and short sales made up about 32 percent of all the new listings, according to the August market update.
Scott Parkin, owner of Northeast-based Hoffman Parkin Urban Realty, said he’s seeing a lot of cash buyers and people looking to purchase second homes. Empty nesters looking to downsize continue to be a large segment of the housing market.