7 minute read
Minnesota: Minneapolis, MN real estate
Long Doan
MINNESOTA: MINNEAPOLIS, MN REAL ESTATE MARKET TRENDS & ANALYSIS
All eyes are in Minnesota, mainly because of the unfortunate incident that happened in late May, where a police office blatantly killed a black man in daylight, spurring a massive riot all over the country. What happened in Minnesota, my beloved state, is something that I am not proud of. It sends us as a country so many years back, and I feel the systemic racism that has crept the very fabrics of the institutions meant to protect live and human dignity have failed, quite miserably. My condolences go to the family of George Floyd; no family should ever lose a son in the manner that George did. All we can hope for is that justice will be done.
Minnesota, despite the stain marks made by some inhumane people, is a good state. If you are a keen investor, or if you are looking for your next residence, the future is in the Minneapolis real estate market. The Minneapolis real estate market is following the example set by the national trend, which is to mean that the market is moving in a promising direction. Therefore, home prices in the region continue to rise in lieu of the constrained supply of new housing inventory. Even with the prices rising, you would expect the demand to subside, but on the contrary, demand remains to be strong, which shows there is an insatiable demand for housing in the region. Of importance to note, however, is that while the appreciation of house prices continues for the seventh year now, real estate in the state is incredibly affordable.
FUN FACT: DID YOU KNOW THAT IT IS MORE AFFORDABLE TO OWN A HOME IN MINNEAPOLIS THAN RENTING ONE?
AN OVERVIEW OF THE MINNEAPOLIS MARKET
The median home value in Minneapolis is $291,476. According to Zillow, the market in Minneapolis is warm, and in the last year, home prices in the area have gone up 3.3%. Zillow also predicts that they will fall -1.8% within the next year. Here are some more statistics about the market;
Average Days on the market: 67 Median Rent Price: $1,800 Price-to-rent ratio: 13.13 Percent with negative equity: 6.3% Unemployment rate: 3.0% Population: 425,403 Median Household Income: $58,993. Percentage of vacant home: 8.83% Foreclosure rate: 1 in every 2,799 (3.5%)
The housing market in Minneapolis is forecasted to be on a positive growth trajectory over the course of 3 years ending the 3rd quarter of 2021. The Minneapolis real estate market trend indicates that there was an increase of 7% in home sales and a 3% rise in the past year. As recently as of the second quarter of 2019, the Minneapolis real estate market ranked among the topmost cities with increasing housing flipping rates. The year 2019 was a year marked by an increased flipping rate in almost all housing markets reaching a nine-year high, but
Minneapolis stood out, recording the largest increase in flipping rates than the majority of the national housing markets.
“Along with Raleigh, Charlotte, and Milwaukee, other metro areas with a population of at least 1 million and a home flipping rate increasing in the double digits were San Antonio, Texas (up 47 percent); Houston, Texas (up 41 percent); Atlanta, Georgia (up 38 percent); Pittsburgh, Pennsylvania (up 36 percent); and Minneapolis, Minnesota (up 33 percent),” according to the latest Q1 2019 U.S. Home Flipping Report.
IS THIS THE RIGHT TIME TO BUY IN MINNEAPOLIS?
If you look at the statistics and the current trends of the Minneapolis city, one thing is particularly evident; everything has been moving quite softly in the city. But is it a good time to invest in this market? Is this the right time to buy a home in Minneapolis? Currently, the increased interest in the Minneapolis housing market has largely been due to the affordability of homes in the area. The price-torent ratio in the region favors buying where it is more affordable buying a home than renting, which only means the demand for homes in Minneapolis is inherently higher. Moreover, while renting a home in Minneapolis remains an open question, the affordability of buying could limit their upside.
Well, it is doing quite well! And that should not be a surprise to anybody. However, that is not to say that the market is performing optimally, there remain vacuums where the market needs to fill. RealtyTrac reports that the Minneapolis real estate market has about 537 properties under foreclosure, each of which is at least in one of three stages of distress; default, auction, or bank-owned. Additionally, RealtyTrac data shows that of the 73.6% of the distressed properties in Minneapolis, an overwhelming majority of the foreclosures are of the auction variety. This is to means that homes have already been repossessed by the lender and have been placed on auction. Price is a factor to consider when buying a home. Over the recent past, Minneapolis has seen a positive growth trajectory regarding home values. The median home value in Minneapolis is $291,476 going by the most recent data from Zillow. In a year, Zillow predicts that the prices will fall -1.8%. Over the last year, home prices in Minneapolis have appreciated 3.3%, with this increase attributed to several factors. One of the prevalent factors is the price-to-rent ratio. At 13.13, the price to rent ratio suggests that it is cheaper to buy Consequently, investors interested in investing in the Minneapolis market and are interested in the acquisition of the distressed homes may find auctions to be their best source of deal. The remaining portion, 26.4% of the properties on foreclosure, are considered to be bankowned properties. You must take note of these statistics about the Minneapolis housing market and their distributions in order to place their odds intelligently.
To help you in decision making, one of the most important things you have to look at is the neighborhoods with the highest distributions of foreclosed properties if you want to acquire the best deals at a discounted rate. According to the RealtyTrac, some of the neighborhoods in Minneapolis with the highest distribution of the
HOW MUCH DOES IT COST TO BUY IN MINNEAPOLIS?
distressed homes are;
a home than renting one. This has resulted in people leaning more towards purchasing homes than buying, leading to increased demand for housing. At the same time, the supply of new housing units has constrained the market, pushing the prices up.
As of July last year, the single-family inventory was relatively low, and with just about 1.7 months of single-family inventory, the Minneapolis housing market is 4.3 months shy of a balanced market.
Nevertheless, it is worth stressing that the
Minneapolis housing market is characterized by affordability. Since it is more affordable to buy than rent, the city is expected to flux with buyers, which bodes incredibly well for the investors. In the recent past, we have seen a perfect storm brewing for the real estate Minneapolis is the place to be. The real estate market in Minneapolis is a booming market and will continue to be a favorable market in the foreseeable future. This is the right time to buy and invest in real estate because the mortgage and the interest rates are at historic lows, and what a better place to buy than in Minnesota? If you would like to learn more about the Minneapolis market, connect with Long Doan, one of our VIP Agents. This a special invite-only program run by the Power Is Now Media for real estate professionals. To learn more about this program, follow this link; https://thepowerisnow. com/vip-program-2/. Long Doan came to America alone as a “Vietnamese boat people” at the age of 14. He survived his stay at “Hell Island,” which was the most heavily populated place on earth at that time where he was an orphan living with more than 40,000 other refugees in a crowded area about the size of a football field. Real Estate Agent Magazine did a story on his journey
“Long Doan: Journey From Oppression To
investors where there has been an incredible demand persisting in an environment where the real estate prices have continued to rise against all the odds, and as expected, albeit at a more moderate rate. This means the Minneapolis
housing market looks as clear as ever!
Optimism.” To read more about Mr. Doan, follow
this link; https://thepowerisnow.com/long-doan/.
Long Doan Real Estate Agent Realty Group
Sources:
https://www.noradarealestate. com/blog/minneapolis-real-estatemarket/#:~:text=Homes%20in%20 Minneapolis%20receive%202,up%207.8%25%20 since%20last%20year. https://www.fortunebuilders.com/minneapolisreal-estate-market-trends/ https://www.noradarealestate.com/blog/ minneapolis-real-estate-market/ https://homesmsp.com/2020/05/2020-realestate-showings-surpass-same-time-last-year. html https://www.zillow.com/minneapolis-mn/homevalues/
