The Twin Cities home market continued to percolate in January, though it remained below full boil because of constrained supply.
Buyers in the Twin Cities metro signed 3,033 purchase agreements for homes last month, 3.5 percent more than a year ago, the Minneapolis Area Association of Realtors said Friday.
"This year's spring market started earlier and stronger than in past years," said Cotty Lowry, a sales agent with Keller Williams and president-elect of the association.
Closings on deals that were signed late last year rose 17.8 percent, with the median price of those closings rising 10.3 percent to $215,000. Prices reached new highs in several markets, including Edina, St. Louis Park, Plymouth, Hopkins, Uptown and southwest Minneapolis.
And despite the Federal Reserve's increase in December of the main borrowing rate for the nation's banks, mortgage rates have slipped for six weeks, putting the average 30-year fixed rate mortgage at 3.69 percent as of Thursday, according to Freddie Mac. That's barely above the 2015 low of 3.59 percent and within shouting distance of all-time lows.
Many shoppers, however, have been unable to take advantage of falling rates, and house sales in parts of the metro are being constrained because of a shortage of listings.
The number of properties to hit the market during January was down 7.2 percent, causing overall inventory levels to fall 22.2 percent to the lowest level since 2003.
And at the current sales pace, there are only house listings to last 2.1 months — the lowest on record and a full month lower than last year. Generally, five to six months of supply is considered a balanced market.