The Twin Cities real estate market is feeling the effects of recent economic uncertainty, tariffs and federal job cuts.
Last month's numbers showed a decrease in new listings for the first February in five years, and higher than expected mortgage interest rates at close to 7%.
Minnesota Realtors President Patti Jo Fitzpatrick says those factors may have contributed to a slow month that saw potential sellers playing it safe.
"Sellers are married to their interest rate from from before, so there's a little bit of slowness of sellers putting their houses on the market and losing that good interest rate," Fitzpatrick explains.
Just this week the Federal Reserve left interest rates unchanged, which is likely to mean those higher-than-desired mortgage interest rates will also stay stable this spring, typically the busiest season of the year for the real estate market.
Fitzpatrick says that, coupled with the current political climate, could have an impact on the traditionally busy spring.
"Consumer confidence is down," ssays Fitzpatrick. "We've got tariffs going on. People are, you know, in the federal workforce are losing their jobs or there's some uncertainty there. So I think that, you know, that could play a factor in what the market is going to look like."
Last month's numbers for the state showed a decrease in new listings for the first February in five years.
● New listings fell 7.2% statewide and 5.3% in the Twin Cities
● Signed purchase agreements declined 7.9% statewide and 7.7% in the metro
● The median sales price increased 4.9% statewide and 6.9% in the metro
The statewide median home price was up 4.9% to $343,000, while the metro median price was up 6.1% to $380,000. But today’s home buyers are more sensitive to their mortgage payment than to home prices in general.
Even as home prices rise, monthly payments could fall if rates decline enough. A typical “all-in” payment on the median priced home, including taxes and insurance, was about $2,500 statewide and $2,800 in the metro for 2024.