Fall is in the air – leaves are changing colors, Vikings are 3-0 (who would have thought that?) and homes are in multiple offers…Wait, what? Yes, we are still seeing multiple offers on homes rather frequently. How could that be? For starters, when reviewing the most recent numbers from the St. Paul Area Association of Realtors (SPAAR) we have about 16% less homes available from this time last year, further more, look at the Historic Inventory Levels – at the beginning of 2016 we were at the lowest seen in the past 12+ years. All of which leads to a highly competitive market for both buyers and sellers.
On a three month rolling average, pending sales are only up 2.9% from this time last year – which I would argue would be much, much higher if there was more inventory to sell. Interest rates remain low and home affordability remains high. The question that often comes up then is when should we sell or buy?
It is always hard to predict real estate trends as there are multiple factors that can have an affect on the market. What we do know is that inventory levels are extremely low and buyer purchasing power is very high – personally, if I had a home to sell – right now would be a great time to get it on the market. We have heard rumors and reports through out the industry that a market correction is coming – how true that is or how soon that happens is anyone’s guess. Check this out though – Median Home Prices are above our 2006 numbers, does anyone recall what happened shortly after that peak???
Hopefully we have learned from the challenges we had faced with the last downturn and put some safeguards in to prevent another sub-prime lending epidemic. We cannot see the future in real estate, we can only see the now and the now is indicating a very strong sellers market.