Spring into Action: Our Take on the 2023 Real Estate Market Trends

March felt like a typical Spring market where activity picked up substantially. During COVID, the Spring market started as soon as January 1 whereas on a more typical year, the Spring market in Minnesota typically starts right around the Superbowl. Despite the interest rates being in the 6's, there still are too many buyers for the amount of homes on the market.

The most competitive price point:

The most competitive price point being $700K-$1.2M in areas like Edina, parts of St Louis Park, certain South Minneapolis neighborhoods, and western suburbs. But, it's competitive everywhere. And the reason for this is simple - supply and demand. The demand for homes in this price point outpaces the supply more than nearly every price point. This is not to say homes under this price point are not competitive because they absolutely are! We are still seeing multiple offers on properties and “cash” offers at all price points.

So, are we going to see a pricing correction in 2023?

My take (Adam's) is a no. And this is not just some Realtor-speak to try to incentive people to get off the sidelines. This comes down to data, plain and simple. We are no where near the 2008-2011 data points and the buyer population is composed mostly of Millennials looking for their first and next houses and Baby Boomers looking for a downsized home. These are by far the two largest populations in the United States looking for homes with little supply and not a ton of future supply to look forward to. Building new construction is costly and still down numbers wise and the fact that so many people are sitting on an interest rate of 3.5% or less, many people are choosing to stay put. 

If you want to buy your next home, shoot us a message. We know our market very well and would love to give you the confidence to know that the real estate market in the Twin Cities is solid. And, if you are a seller, you probably do not realize how much equity you have in your home as prices skyrocketed since early 2020 and you may be able to use that equity to trade up for a home with more amenities by using that equity to keep your monthly payment similar or slightly more.

Cheers!

Adam & Brit