Skip to main content

Twin Cities housing market good for moving up the ladder, not good for getting on

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

The Twin Cities housing market is hotting up as spring arrives, but the issues that have hurt first-time buyers still seem to be play in 2019.

The Minneapolis Area Realtors' Association said that there remains a serious housing supply issue that continues to push up prices for those houses that do get listed on the market.

Since the start of the year, there has been a 6.1 percent decrease in new listings, while the median sales price hit $265,500 in February – a record for the month and a 6 percent increase on a year ago.

It spells bad news for those hoping to get on the ladder, with houses price anywhere below $300,000 still in huge demand, resulting in an ultra-competitive market for lower-income buyers.

It's the opposite case for those with middle to upper-bracket homes, according to Lakes Area Realty's Larry Lavercombe, with homes valued at $500,000 and above not selling nearly as quickly, and not for as much as the owners had hope despite continued low interest rates.

"It’s [the market] not working well for people selling or building upper-middle and upper-bracket homes," Lavercombe said. "Those prices have plummeted lately. I’ve seen reductions over and over for million-plus homes."

While it's not good news for first-time buyers, and higher value sellers, the market plays right into the hands of younger families who have owned a sub-$300,000 home for several years, getting it at a lower price, and are now looking to move up the ladder.

With middle bracket homes not selling for as much, Lavercombe says it's a good time for these families to buy their "20-year-plan house for a lower price," knowing they can get top-dollar for their own homes.

Want to enjoy Bring Me The News ad-free? Sign up for Premium from $3.99/month

Judy Craig, of Edina Realty, says that there is still hope for sellers above the $500,000 level, but they'll need to make sure their home is in satisfactory condition before bringing it to the market.

And there will also be value, she says, in homes in neighborhoods with high walkability, and easy access to trails and local shops.

With the market below $500,000 so competitive in the Twin Cities metro, Craig says that prospective buyers should look for representation from an agent, as many have been "strengthening their internal networking of coming soon properties."

"They might also have access to past clients who might be thinking of selling," she said. 

"Many don’t know how to navigate multiple offers to their advantage, and buyers don’t pay for representation ... sellers pay commissions so it makes sense for buyers to have help."

Next Up

Screen Shot 2023-01-30 at 9.31.03 AM

Old Navy closes Eagan store

There's another change in store for the popular Eagan strip mall.


Charges: Man shot victim in leg outside a Cowboy Jack's

Corey Ryman allegedly chased another man around a parking lot before shooting him.

police lights squad car dark - Unsplash

Man shot in both feet after interrupting vehicle break-in in St. Paul

The incident happened just before 10 p.m. Saturday.


Cook County — The cure for cabin fever

Come bask in the quiet of this peaceful winter getaway.

Screen Shot 2023-01-29 at 1.54.31 PM

Missing: Minnesota man last seen in Sioux Falls area

Aaron Pearson, 41, was reported missing on Thursday.

Screen Shot 2023-01-27 at 7.45.44 PM

Protest for Tyre Nichols to be held outside MN Governor’s Mansion

Activists groups say they’ll call on Gov. Tim Walz and the Legislature to implement police reforms.


Minnesota pool contractor banned from industry, must pay $2 million-plus

Minnesota Attorney General Keith Ellison filed suit against Charles Workman and his company, MN Crete Pools, LLC, in August.

Minneapolis police

St. Paul man identified as victim of north Minneapolis homicide

The shooting occurred on the 2200 block of Emerson Avenue North on Wednesday.


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.

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

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

Median house prices in Twin Cities pass $300,000 for first time

However, there was a significant slump in new listings resulting from COVID-19.

House for sale

MN house prices rising despite pandemic, though pending sales are tumbling

The coronavirus crisis is having an impact on the real estate market, just not house prices.

House for sale

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

Area Realtor associations have released their February housing 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.