June 2021

School’s out, and as vaccination rates rise and America enters a new normal, the U.S. housing market continues along at a frenzied pace, with low interest rates and limited inventory fueling record high sales prices. May saw the median existing-home sales price exceed $350,000, a 24% increase and the largest year-over-year increase since1999, according to the National Association of REALTORS®. Eager buyers are making multiple offers, some for well over asking price, while others are making offers on homes sight unseen.

New Listings in the Twin Cities region increased 10.7 percent to 8,378. Pending Sales were down 2.5 percent to 6,738. Inventory levels fell 35.5 percent to 6,592 units.

Prices continued to gain traction. The Median Sales Price increased 14.8 percent to$350,000. Days on Market was down 52.4 percent to 20 days. Sellers were encouraged as Months Supply of Homes for Sale was down 47.6 percent to 1.1months.

The increase in sales prices comes with a slight decline in existing home sales nationwide, as homebuyers struggle with declining affordability amid a lack of inventory, forcing some buyers to simply wait it out in hopes of more inventory and less competition. Meanwhile, home builders are trying to meet the increased market demand, with housing starts up 3.6% in May from April, according to the Commerce Department. As we ease into new routines and look forward to a post-pandemic future, one thing remains certain: America desperately needs more homes.