Edina Realty Continues to Set the Pace as the Region’s Real Estate Market Leader During a Banner Year in the Market
Edina, MN (PRWEB) January 14, 2016 -- The year 2015 was a banner year in the real estate market, and Edina Realty continued to lead the local market, handling more than 32,000 transactions in Minnesota and western Wisconsin for a total of $8 billion in pending sales volume.
According to the Minneapolis Area Association of REALTORS®, housing demand in the Twin Cities reached a 10-year high. Pending sales were up 18.1 percent to 3,497 and the median sales price was up 7.3 percent to $219,900 in November 2015. Housing prices in some areas are even above their previous peaks.
However, low inventory levels are still an issue in a market where the demand is outstripping the supply of homes for sale. In November, new listings in the Twin Cities area rose 11.5 percent to 3,785 but the overall inventory level fell 18.5 percent to 12,984 units. The months’ supply of homes is down to 2.7 months; if no new homes came on the market, the current inventory would theoretically be sold within 2.7 months.
“Buyers are facing stiff competition, especially in popular areas and price points. It’s common to see homes in high demand neighborhoods sell quickly,” said Greg Mason, president and CEO of Edina Realty Home Services.
Mason said this spring, he expects to see a higher inventory of existing homes for sale and new construction starts, which will help satisfy buyer demand. He predicts a more traditional seasonal market, with a sellers’ market in spring, a more balanced market in summer and a buyers’ market in the fall and winter.
The National Association of REALTORS® expects existing-homes sales to finish the year up 6.5 percent from 2014 at a pace of around 5.26 million – the highest since 2006. In 2016, existing sales are expected to grow between 1 and 2 percent and housing prices are also expected to rise between 5 and 6 percent.
Ron Peltier of HomeServices of America, Edina Realty’s parent company, has a similar perspective with existing home sales coming in at around 5.3 million in 2015, but he anticipates a 2-3 percent increase in 2016. Peltier expects new construction to be strong and says growth is supported by favorable interest rates, accommodating credit standards and 2016 being an election year. While the Federal Reserve raised its key interest rate by 25 basis points in mid-December, most market forecasters don’t expect the slight rise in mortgage rates to deter buyers.
Minnesota has the highest homeownership rate in the nation, in part because the Twin Cities boasts the lowest unemployment rate of all large metro areas at 3.1 percent. Minnesota also has the seventh highest median household income in the U.S. at $67,244, according to U.S. Census data, and CNBC ranked Minnesota at the top of its list of America’s Top States for Business 2015.
Nationwide, millennials are the largest segment of homebuyers; this age group is expected to comprise two-thirds of homeowners in the next five years. After the housing bubble and great recession, homebuyers are more realistic in their reasons for buying. They are looking for a good place to live and a stable payment structure, rather than a quick return on their investment. “Plus, there are various low down payment mortgage options available to help buyers get out of high cost rentals and into a home of their own,” Mason said.
Homeowners who have struggled with underwater mortgages should see increasing equity as the economy and home prices continue to improve. Housing appreciation will rise more slowly than in recent years – about 3.5 percent – which is healthy and on par with the 18-year historical average, according to Mason.
Sales activity for local luxury properties priced at $1 million and above has greatly improved, according to the Minneapolis Area Association of REALTORS®. Due to its limited pool of qualified buyers, this segment of the market typically sees longer times on market, but activity has been on the rise for many months with time on market down more than 10 percent and closed sales activity up nearly 14 percent over 2014, according to data available through NorthstarMLS for the Twin Cities region.
Edina Realty’s website continues to be the most popular real estate website in the region, with more than 13 million visits in 2015. Furthermore, Edina Realty’s website, mobile website and mobile apps attracted more than 32 million visits combined for the year – an increase of 29 percent overall. Visits to Edina Realty’s mobile site increased 100 percent for a total of 8.9 million visits. Visits to Edina Realty’s mobile apps for iPhones, iPads and Android devices increased 18 percent over 2014 for a total of 9.6 million visits. The company’s increased mobile traffic is consistent with overall consumer trends of increased mobile usage.
Edina Realty currently has 2,350 REALTORS® operating out of more than 75 real estate offices. More than half of the firm’s REALTORS® and staff from Edina Realty and its parent company, HomeServices of America, http://www.homeservices.com, are attending Edina Realty’s annual “Expo,” held on Jan. 14 at Saint Paul RiverCentre, where the leadership team shares the state of the market, the firm’s 2016 strategies, the advertising campaign, and REALTORS have an opportunity to get business insights from five national speakers.
For more information on Edina Realty’s market leadership position and the current state of the real estate market, visit http://www.edinarealty.com or call Edina Realty Customer Care at 952-928-5563.
Maria Verven, Verve P.R., http://www.verve-pr.com, +1 (612) 990-7328, [email protected]
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