A bulk of Minnesota’s housing market is slowing down

The U.S.’s K-shaped economy continues to reveal itself in Minnesota’s housing market.

Monthly sales reports from a trio of Twin Cities and statewide Realtors groups show homebuying in the entry-level market is slowing while luxury sales remain undeterred. It’s a mark of waning consumer confidence for the average American who doesn’t reach the country’s high-earners.

Home sales in the Twin Cities posted a notable decline in the past few weeks, but home prices kept rising. During November, buyers in the 16-county metro signed 3,072 purchase agreements, 2.4% fewer than this time last year. Closed sales (a reflection of demand during the previous two to three months) were down even more, falling 5.6%.

The median price of those closings was $387,000, 2.9% higher than in 2024.

Cautious buyers, a lack of sellers and a productive upper-bracket environment are driving those higher prices at a time of fewer sales. Here are some other notable takeaways from November.

Compared to last year, the number of new listings stayed mostly even. That dearth of listings and a surplus of demand in some areas meant buyers actually had slightly fewer houses to choose from at the end of last month than they did last year.

In some parts of the metro, would-be buyers sat on the sidelines because they couldn’t find a house to satisfy their needs. In some places, especially high-demand neighborhoods in the best school districts, buyers fought for what listings there were. That enabled sellers to fetch more than their asking price.

“Meanwhile, multiple offer scenarios have become less common, but most sellers are still achieving their asking price,” she said.

There were fewer homebuyers in the Twin Cities last month, causing pending sales to post their second-consecutive monthly dip and the biggest decline since this spring.

The sales declines were especially pronounced in certain housing types, with pending sales of new houses falling 9.1% and sales of townhouses declining 5.1% statewide.

That same divergence shows up in how long it takes to sell a house. On average, houses statewide took a little longer to sell — 56 days, a slight increase over last year. But there were dramatic differences by location and housing type. For example, single-family homes sold in 53 days while condos took twice as long to sell.

Though mortgage rates have hovered just about 6%, the lowest in nearly a year, home shoppers have become more cautious as the overall economy continues to cool.

On average, houses in the metro took 50 days to find a buyer. That’s consistent with the previous month but below what’s considered evenly balanced between buyers and sellers.

Statewide, houses took a little longer to sell at 56 days, a slight increase from last year, but there were dramatic differences by location and housing type. For example, single-family homes sold in 53 days statewide while condos took twice as long to sell.

With fewer options and rising prices, first-time buyers are clearly struggling, and sales of the least-expensive houses in the Twin Cities have been declining all year.

However, move-up buyers who have equity to fund the purchase of their next house, especially those willing to spend more than $1 million, seem to be having no trouble.

While pending sales of houses priced from $190,000 to $350,000, down about 4%, sales of houses priced at more than $1 million increased more than 17%. Those double-digit gains, which have been happening consistently all year, are helping cause a statistical increase in the median price of all sales.