Twin Cities home prices continued to gain strength in October, according to data released Tuesday that underscored the likelihood that the market's winter slowdown would be shorter than usual.
Home prices in the metro area during October posted a stronger year-over-year gain, rising 4 percent in the 12 months ending in October, compared with a 3.6 percent gain in the period ending in September, according to the Standard & Poor's/Case-Shiller 20-city home price index.
Nationwide, home prices rose 5.5 percent in the 12 months ending in October, compared with a 5.4 percent pace in September.
Home values have climbed at a roughly 5 percent pace during much of 2015, as strong hiring has bolstered a real estate market still recovering from a housing bust that triggered a recession eight years ago. Home sales have increased this year as the 5 percent national unemployment rate has strengthened confidence in the economy.
In the Twin Cities, home price gains have run slightly below the national average and been only about half of what's being reported in coastal and tech-center metro areas, including Portland, Ore., Denver and San Francisco.
Not to worry, economists say, noting that moderate increases are far more sustainable than the double-digit gains being posted elsewhere.
Price gains in the Twin Cities are being driven primarily by tight supply and strong demand, especially in the seven-county metro area, where the job market has been particularly strong. In November, sales outpaced new listings in many parts of the metro, causing the total number of properties for sale at the end of the month to hit near-record lows.
At the current sales pace, there were only enough houses on the market to last a bit more than three months, according to the Minneapolis Area Association of Realtors, which will issue its year-end sales report the second week of January.