While there are many talks about the economy being in a recession, the first estimates of Real GDP for the 3rd quarter came out this week suggesting a rebound from two quarters of economic decline. Long story short, inflation hit hard for two quarters & is now starting to recover. Additionally, the jobless claim rates are still relatively low (despite an uptick) which shows companies are still filling positions & reluctant to let people go due to the challenges of hiring right now. These employment rates definitely impact the housing market as many millennials are still looking to purchase their first home, obviously they need the capital to do so. While we are technically still in a seller’s market, we really are in a period where homeowners & potential buyers need to review their specific needs to determine their next moves.
Real Estate Buyers' Insights - October 2022
For buyers, the story of rising mortgage rates continues. It’s important to keep in mind that the rates we saw in 2020-2021 were historically low & it’s rather common throughout history to see the rates in the 5-6% range. While these higher rates tend to scare off buyers, it may end up being beneficial for a lot of first-time home buyers. This may give them the edge they need to secure a starter home as less competition is in the market. While the mortgage rates are currently high & that does impact how much you spend, something to keep in mind is that you can always refinance when rates balance out again. As consumer energy & food costs continue to rise, it’s expected to cause another rise in federal interest rates, so November may bring the best mortgage rate until next spring. If you’re considering purchasing a new home in the next 6 months, definitely sit down with your Mortgage Lender & Real Estate Agent to see what your options are, especially with the incentives for first-time homebuyers.
Real Estate Sellers' Insights - October 2022
From a seller’s perspective, inventory is still a hot topic in the market. Even though the number of homes being listed for sale has begun to rise a little (up 3% in Minneapolis in September), the lack of inventory still has buyers chasing opportunities. While the rise in mortgage rates & inflation have caused them to be more selective in their purchasing decisions, the median sold prices are continuing to rise (up $5600 in Minneapolis in September). While the number of homes being sold has slightly decreased over the past 2-3 months, there are a number of factors showing a slow in economic decline & an increase in consumer spending going into the holidays. If you’re considering selling in the next 6 months, you may want to consider listing in November as mortgage rates are expected to rise again before 2023. Grimm Realty Group offers a Complimentary Market Analysis to help you make the best decisions on selling your home, from timing to pricing.
Rental Market Conditions - October 2022
While the rental market has recently hit a plateau for pricing, rent is still up 23.4% since March 2020. According to Realtor.com, more than half of renters who are registered to vote say that this issue will impact their decisions at the midterm elections. With a third of the voting population being renters, this just showcases how the rising costs of living is impacting many families. Even though the past 2 years have seen a rise in rental prices, September’s National Average was down $22 from July. For those considering buying a home in the next year, this break in the rental pricing could give people a chance to take their time in finding a more perfect home. We cover this in more detail in our blog “Renting vs. Buying in the Post-Pandemic Real Estate Market”.
For more information on the Twin Cities Real Estate Market, visit the Realtor Associations in our area or check out these 2 videos by local realtors:
https://www.mplsrealtor.com/ - Minneapolis Area Realtors
https://spaar.com/ - Saint Paul Area Association of Realtors
https://www.mnrealtor.com/home - Minnesota Realtors
https://www.youtube.com/watch?v=7Iv3P-BL59E - Tom Laing Realtor
https://www.youtube.com/watch?v=106ZHxPdkZ4 - Joe Carmack Realtor
Contact Grimm Realty Group for Twin Cities Real Estate
For additional insights on the current conditions in St. Paul & Minneapolis, you can contact Grimm Realty Group for a complimentary consultation. Doug Grimm & his staff are eager to help buyers & sellers navigate the ever-changing Real Estate Market. With the mountains of information out there, having an expert by your side can help you navigate the process & weed out the incorrect or misleading info. Give us a call today!
Have a question about your home buying or selling options or the Real Estate market in general? You can schedule a Zoom Meeting with Grimm Realty Group to discuss your housing needs, lifestyles, & future goals!
October 2022 Twin Cities Real Estate Market Update Sources:
Realtor.com: Weekly Housing Market and Economy Update
Rocket Mortgage: September '22 Minneapolis Housing Market Report
Realtor.com: Renters are Fed Up with Rising Rents
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The content on this page provides general consumer information. It is not legal advice or regulatory guidance. Grimm & Associates may update this information periodically.
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