The imbalance between buyers and sellers in the Twin Cities is becoming more extreme, causing sharp price increases just in time for the summer homebuying season.
At the end of April, there were only about 9,200 houses for sale in the 13-county metro market — the first April in decades when house listings dipped below 10,000, the Minneapolis Area Association of Realtors (MAAR) said Tuesday.
"It's out of control," said Becky Quinby, who co-owns an independent real estate brokerage in south Minneapolis. "We're seeing every single property we list get at least three offers."
Quinby said that so far this year, her office has already done more business than they did during all of last year. In one month they sold eight properties before they were ever publicly listed.
Still, a shortage of listings is stifling sales, which fell 5.2 percent last month compared to April 2017. That shortage is creating stiff competition and putting upward pressure on house prices, which increased nearly 8 percent. The shortage of listings is particularly acute among entry-level houses, pitting buyers against one another.
For fear of not finding a house to replace the one they own, sellers are staying put and new houses aren't being built quickly enough. During April there were 7.2 percent fewer new listings — the sixth consecutive month of annual declines. That was about half as many listings as six years ago and 25 percent fewer than last year at the same time.
The average price per square foot was $152, a 7.7 percent increase from last year. The median price of all closings during the month was $266,000, an 8.6 percent increase and a record high for April.
Buyers aren't the only ones who are desperate. Some agents are door-knocking, others are writing "I have a buyer for your house" letters.