MINNEAPOLIS – The arrival of the spring and summer real estate season has also revealed a new trend in the Twin Cities housing market - “historically low” inventory.
“What’s different about this market is the number of homes for sale, historically low. Lower than it was last year by almost 20 percent. And by historical standards, it’s very low,” said Herb Tousley, the Director of Real Estate Programs at the University of St. Thomas.
Tousley referred to data collected by the Multiple Listing Service for the 13-county metro area. That data shows 11,000 homes were for sale in the Twin Cities market at the end of March 2016. In March 2015, there were 14,000 homes on the market. And at the housing peak back in the mid 2000s the data shows up to 22,000 homes were on the market.
Market analysts say the Twin Cities trend is clearly the result of a perfect storm of real estate realities beginning with that housing bubble about a decade ago.
“First time homebuyers from 10 years ago, who would be generally moving up, purchased high, went through the housing bubble. Some of them lost their homes, so they had some credit issues,” said Chris Galler, CEO with the Minnesota Realtors Association.
That group of people, whom Galler said is mostly comprised of “Gen Xers,” may no longer be underwater but continue to try and crawl back from near-negative equity.
“Some of them just aren’t in the position yet to look at buying,” Galler said.
Galler continues to refer to demographics when explaining the low-inventory trend. Besides the hesitant Gen Xers, Galler said Baby Boomers are also looking to downsize into a moderately-priced home. And even Millennials are contributing to the trend, by postponing their initial housing purchase and then jumping into the market a little higher on the ladder.
All three groups are vying for homes within