December 2021
The 2021 housing market was one for the history books. After three consecutive
months of increases recently, existing home sales are on pace to hit their highest level
in 15 years, with an estimated 6 million homes sold in 2021 according to the National
Association of REALTORS®. Sales prices reached new heights, inventory hit rock
bottom, and homes sold in record time, often for well above asking price. Mortgage
rates, which began the year at historic lows, remain attractive, and homeowners who
choose to sell in the coming months can expect to see plenty of buyer activity due to
pent-up demand during the pandemic.
New Listings in the Twin Cities region decreased 18.5 percent to 2,548. Pending Sales
were down 12.4 percent to 3,284. Inventory levels fell 24.1 percent to 4,438 units.
Prices continued to gain traction. The Median Sales Price increased 7.8 percent to
$331,000. Days on Market was down 15.4 percent to 33 days. Sellers were
encouraged as Months Supply of Homes for Sale was down 27.3 percent to 0.8
months.
Looking ahead, experts anticipate many of the housing market trends of 2021 will
continue in 2022, albeit at a more moderate level. Strong buyer demand and inventory
shortages are likely to persist over the next year. Home sales are projected to remain
strong but will be tempered by the limited supply of homes, higher sales prices, and
rising interest rates, with the Federal Reserve planning multiple rate hikes in the new
year. Price growth is expected to slow somewhat as a result, but affordability will likely
remain a top constraint for some homebuyers.
– SAINT PAUL AREA ASSOCIATION OF REALTORS®
