Skip to main content

A seller's market: Record-low inventory in Twin Cities, as buyers fight for new homes

Area Realtor associations have released their February housing report.

A record-low inventory is starting to impact home sales in the Twin Cities metro area at a time when buyers are eager to find a new house. 

“We’re seeing lots of factors at play right now,” Todd Walker, President of Minneapolis Area Realtors said in a statement. “Buyers are running up against the inventory shortage even as they’re inspired by 50-year low mortgage rates. We’re seeing shifting attitudes around urban living and condos. People are also very encouraged by the progress on the vaccination front.”

New data from the Minneapolis Area Realtors and St. Paul Area Association of Realtors show sales activity in the 16-county metro continues to be above 2020 levels. Closed sales rose 4.8% in February 2021 compared to February 2020, which is the highest figure since at least 2003, a news release says. 

Meanwhile, signed purchase agreements have leveled off. While they're the strongest since 2005, they were down 0.1% from last year, which suggests a low supply of properties could be constraining sales, the release notes.

In fact, the number of homes on the market is at a 20-year low. Sellers listed 12.6% fewer properties in February 2021 compared to February 2020 and the number of homes for sale in February was down 46.3% compared to a year ago (that's 0.8 months of supply, while a balanced market has 4-6 months of supply).

Sellers, though, are benefiting from "historically strong" offers, with homes selling at 100.1% of the list price and often receiving multiple offers. Homes are selling in record time, too — half the listings in February sold in fewer than 19.5 days. 

Looking to buy or sell? Find a realtor using the BMTN directory

“With so many buyers vying over a shrinking pool of listings, well-priced and well-staged homes don’t spend much time on the market,” said Tracy Baglio, President of the Saint Paul Area Association of Realtors. “That means buyers have to come out swinging right out of the gate with their best offer in order to be successful.”

While pending sales were down 0.1% across the 16-county metro, they were up 23.3% in Minneapolis and 8.4% in St. Paul. This indicates that there's still buyer interest in the "urban core." 

Meanwhile, after lagging in sales in 2020, condos saw the strongest demand growth in both pending and closed sales in February. 

New construction sales rose 32.5% compared to a 2.6% increase for previously owned homes. And sales of luxury properties (those priced at $1 million and up) have also been strong, up 53.1% from last February.

Next Up

basketball unsplash stock

High school basketball games canceled after adult 'threatens to bring gun'

The boys and girls varsity and JV games between South St. Paul Secondary and Two Rivers High were canceled.

Screen Shot 2023-01-31 at 9.18.37 PM

Bed, Bath & Beyond closing 86 more stores, including in Bloomington

The struggling chain closed a store in St. Cloud last year.

Andy Trowbridge

Tributes to KARE 11 sports producer who has died at age 35

KARE says Andrew Trowbridge died following a 'brief illness.'


Man pleads guilty to murder of Inver Grove Heights father

Michael Chang-Beom Lee, 43, was killed during a burglary at his home.

Eggs at Hy-Vee

Price comparison: How much do eggs cost at Twin Cities grocery stores?

Prices have been spiking, so where can you find the cheapest eggs?


FOX 9 promotes Hannah Flood to anchor, adds new reporter

Hannah Flood will co-anchor mornings while Se Kwon joins the team.

Carjacking pursuit in Little Canada

Watch: Suspects drive wrong-way on I-35E, before carjacking separate vehicles

The Ramsey County Sheriff's Office said the suspects are still at large.


St. Paul restaurant damaged in Sunday night fire

The fire department said the fire is considered to be "accidental."

Lake Superior.

MPCA: Minnesota's emissions fell by 23% between 2005 and 2020

Clean energy investments have driven the decline.


House for sale

Despite pandemic, Twin Cities housing market set records in 2020

Sales were up 7.7% in 2020 compared to the year before.

House for sale

Twin Cities median home price hits record $280,000 in 2019

The Minneapolis Area Association of Realtors has issued its annual report.

House for sale

The crazy Twin Cities housing market is showing signs of slowing down

Agents are seeing fewer multiple offers and no inspections are less prevalent.

House for sale

Twin Cities housing market offering mixed blessings for buyers, sellers

It's good for those moving up the ladder, less so for those getting on.

House for sale

Zillow to start buying homes directly from sellers in Twin Cities

The Twin Cities becomes the 10th metro where Zillow has launched its buying service.

Pixabay - keys home house

Latest data show Minnesota's housing market is still crazy

Demand continues to outpace supply, and sales prices are at historic highs.