Sales of high-end homes rose in June, but a lack of starter homes stifled the lower end of the market.
Increasingly, it is becoming a tale of two housing markets in the Twin Cities.
With first-time buyers and downsizing baby boomers outpacing sellers, entry-level listings on the market have fallen steadily throughout the year, stifling home sales across the metro area.
During June, home sales fell 8.2% compared with the same period last year, according to a midyear report from the Minneapolis Area Realtors (MAR). Pending sales — an indication of future closings — fell slightly less.
Those declines stem from a lack of starter houses. As of June, there were 14% fewer houses priced at less than $250,000 compared with last year, and nearly half as many as two years ago. With few options, many would-be buyers are stuck on the sidelines — sales of those starter houses fell 15% last month.
At the same time, upper-bracket sales are on the rise. Sales of $1 million-plus homes posted a 15% annual increase, the biggest gain in any price range.
“There is definitely a trickling up happening in the market,” said Jeffrey Dewing of Coldwell Banker Burnet. “We are still experiencing a lot of consumer confidence, a healthy economy and interest rates that are still close to the lowest level since 2016.”
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"Twin Cities home sales drop, but median selling price hits record $290,000"; By Jim Buchta; Star Tribune; July 19, 2019