The Minnesota housing market continues to move away from the bottom, as July home sales climbed 4.6 percent, the Minnesota Association of Realtors reported Tuesday.

Other positive signs emerged during the month: the median home price was up 11.1 percent, sellers received a higher percentage of their asking price, and homes were selling faster, on average.

Still, the housing recovery has been uneven across the state, as seven of the 13 regions tracked by the Realtors association showed a notable decline in sales, many in rural areas with limited economic prospects.

"Areas where the job markets have held up will be the steadiest," said Herb Tousley, director of the real estate programs at the University of St. Thomas. "Those will be the ones that come back the first and strongest."

The market was strongest last month in the Twin Cities metro area, where closed sales were up nearly 17 percent. In the remote and less populated Upper Minnesota Valley region, sales were down more than 42 percent. The contrast between those regions and others in the report is a reflection on the link between housing and jobs.

In the Arrowhead region, for example, home sales in July fell 10.5 percent from the same period a year ago. While Ely and Duluth have enjoyed steady job growth, their success hasn't had much of a ripple effect.

Gary Kalligher, a ReMax sales agent in the area, said that in Duluth and surrounding suburbs, July sales were up 23 percent compared with last year. It's a different story in communities that are more than 20 miles outside the city, he said.

"We see some demand for lakeshore, but sales of single-family residences are sporadic," Kalligher said. "Land sales are hit and miss when you get out of the urbanized area."

Bob Albrecht, a Twin Cities broker who also specializes in lakeshore sales in the Park Rapids area, said in nonmetro areas there's a significant difference between lakeshore and year-round properties. "In the city of Park Rapids some listings have just languished," he said. "You can go past properties that have had signs out front for two years."

Albrecht also notes that even lakeshore markets have yet to recover as quickly as the Twin Cities metro. Park Rapids is part of the Headwaters region, which includes five counties in extreme north-central Minnesota, including the Mississippi River headwaters. That area saw the biggest increase in closed sales during the first seven months of the year with closings up nearly 34 percent.

In Park Rapids, Albrecht doesn't see such explosive growth, and he's at a loss to explain why home sales have been up so dramatically. He theorizes that because the area is farther from the Twin Cities than other popular getaway home destinations, sales fell harder than they did in areas that are closer to the Twin Cities. The net effect is a more pronounced rebound.

With sales on the rise and a 4 percent decline in new listings during July, the median price of all closings statewide increased to $160,000. That increase is a reflection of a real demand, but it's also a result of a decline in the number of foreclosure sales that's happening statewide.

Also on Tuesday, the University of St. Thomas said the percent of all sales that were foreclosures fell significantly during the month, causing an upward statistical shift in the median sale price because there were fewer fire-sale deals.

The report also raised concerns that ongoing inventory constraints will continue to cause median sale prices to rise as buyers compete for the same listings in high-demand markets. Tousley, the author of the report, said low inventory is also to blame for declines in closings in some areas because prospective buyers simply can't find what they want.

"And if this trend continues," Tousley said, "the lack of inventory of homes for sale may begin to affect sales volume as potential buyers are unable to find homes to buy at reasonable prices."

Jim Buchta • 612-673-7376