Twin Cities Real Estate Statistics from December 2022

2022 was a turbulent year for the US housing market, as inflation, soaring interest rates, and elevated sales prices combined to cause a slowdown nationwide.

Affordability challenges continue to limit market activity, with pending home sales and existing-home sales down month-over-month and falling 37.8% and 35.4% year-over-year, respectively, according to the National Association of REALTORS® (NAR). Higher mortgage rates are also impacting prospective sellers, many of whom have locked in historically low rates and have chosen to wait until market conditions improve before selling their home.

New Listings in the Twin Cities region decreased 11.5 percent to 2,281.

Pending Sales were down 27.8 percent to 2,374. Inventory levels rose 16.2 percent to 5,914 units. Prices continued to gain traction.

The Median Sales Price increased 5.2 percent to $348,660.

Days on Market was up 47.1 percent to 50 days. Buyers felt empowered as Months Supply of Homes for Sale was up 55.6 percent to 1.4 months.

Economists predict sales will continue to slow and housing prices will soften in many markets over the next 12 months, with larger price declines projected in more expensive areas. However, national inventory shortages will likely keep prices from dropping too much, as buyer demand continues to outpace supply, which remains limited at 3.3 months, according to NAR. Even if prices fall, many prospective buyers will find it difficult to afford a home in 2023, as higher rates have diminished purchasing power, adding hundreds of dollars to monthly mortgage payments.

If you are wondering how current national and global situations might be impacting your property’s value, your neighborhood, or the Real Estate market in general, we are happy to provide more specific information.

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

Historic Fort Snelling Buildings Get Revamped for Affordable Veteran Housing

Photo by Mark Gustafon

After sitting mostly vacant since the last World War, Fort Snelling’s Upper Post campus has been preserved and reimagined—as apartments for veterans, military members, and their families.

The Upper Post’s oldest buildings date to 1879—some 50-odd years after the first historic buildings were built at the lower fort. Over its history, thousands of soldiers have quartered there. And in style, no less, as its polo fields, golf course, and trick pony shows, all of which drew civilian crowds from Minneapolis and St. Paul, earned Fort Snelling a reputation as “the country club of the Army.”

Fort Snelling also served as a “separation point” in 1945 and 1946. There, many soldiers who helped win World War II bade their last farewell to army life. Shortly after, the fort was decommissioned and the Upper Post passed on to the Veterans Administration and later the DNR, only for the buildings to sit largely unused.

As we stroll the grounds, Gustafson recounts memories like he’s flipping over seashells on the beach. There were the rickety steps of the tower, the Army Band barracks, which later housed Japanese American code breakers.The officer’s house—there’s a whole row of them at the Upper Post, running perpendicular to the airport tarmac next door—fitted with an ornate 19th-century staircase.

Then there are the massive barracks themselves. When Gustafson was last here, he photographed the buildings, which had windowpanes that were shattered like jagged teeth. He’d even ventured inside, but barely.

“For a million dollars, I don’t think I would have gone to the lower level,” notes photographer Mark Gustafson.

Fast-forward 18 years and nearly $200 million, and the barracks are being converted into simple, stylish apartments with whitewashed walls and stone countertops.

The revamp was born of a public-private partnership, headed by the Minnesota DNR, the Minnesota Historical Society, Hennepin County, and other entities. Over the years, myriad fates had been proposed for the property—an aviation center, an athletic complex, a charter school—before the group settled on a proposal by real estate developer Dominion.

The $160 million–plus project received significant funding in government bonds and low-income housing tax credits. The apartments, billed as affordable, start at $1,235 a month for a one-bedroom and $1,874 for a four-bedroom. And, of course, there’s that historical continuity—Dominion says it’s working to get military families connected with the apartments.

Gustafson, for his part, never had a personal agenda for the Upper Post’s fate. He simply wanted to save it. After his photos were published on the front page of a 2007 Sunday Life issue of the Pioneer Press, he got a call from a man whose father, Vern, had been stationed at the Upper Post during World War II. The two men met Gustafson and his fellow preservationist Todd Adler there. Vern, age 92, outfitted in sneakers and spectacles, gave them a tour. It was the first time he’d been back since 1942.

“The number of military people that were here from the 1800s up to the present—it’s a huge number,” says Gustafson. “To me, it was just about preserving it for their sake.” 

Read the full article.

Related Links

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• What Are Your Goals in the Housing Market This Year?

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

These Are the 8 Spots in Your Home Where You Never Thought to Hang Art

When you think of styling art in your home, it’s easy to get stuck in the conventional gallery wall mindset.

Don’t get me wrong: A gallery wall never goes out of style, and when done right, they truly reflect the personality their owners. Other configurations and places to style wall art around your home exist though, and even better, some of them don’t even require walls (!) and are extremely renter-friendly. Let’s take a look at some inspiration for out-of-the-box art hanging, because if there’s something that almost every home could use, it’s probably more art!

In the center of a window frame

Take a good look at the windows in your home. Some of them might have a great view — a garden, a terrace, a skyline — but other might not really be showcasing anything special. The latter scenario is when styling art in a window can really be fun and rewarding, as shown in this Charleston bungalow above. The key is to not obstruct a window that has a great view or brings in a lot of natural light.

Below a window

A general rule for hanging wall art is to place pieces at eye-level, which is about 57 inches from the floor. Like any other design “rule,” you can bend those parameters a bit for decorative impact, especially when your walls have windows that are unconventional in shape and size. Take advantage of forgotten real estate below a window, just as this Parisian apartment dweller did. The eye will be drawn to this unexpected area once they’ve found a fun piece of art residing there.

Above a doorway

Hanging art above a doorway creates a neat perspective trick that can make your room appear a little bit taller. Here, a colorful print gets its own museum spotlight, thanks to the rays that come in through a skylight. Even if you don’t have the kind of architecture this Toronto renter has, art above a doorway can still make an impact by drawing the eye upward.

Around the whole doorway

To help delineate spaces in a more open concept home, try hanging art around the perimeter of a doorway. If your home has a few doorless passages, you can emphasize the transition from one room into an other by hanging interesting pieces that will make guests stop, look, and linger as they move through space, as is the case in this Louisiana home. Keep the art similar in size — not necessarily shape — to make this look intentional.

On top of other art

An alternative approach to the gallery wall, layered art — or overlapping pieces and hanging some art effectively on top of other art — looks and feels cozy and creative. To nail this look, use smaller frames over larger ones, as this New Orleans dweller did, so you can still see most of the works that you’re hanging smaller pieces over.

On a Mirror

As a kid, I remember going over to my grandmother’s house for family dinners and sitting at a dining room table staring back at myself awkwardly as I chewed the Sunday roast. She had a floor-to-ceiling mirrored dining room, a design choice that was popular in the ’70s. You can still find them in homes today, but before you rip them out (or if you’re renting and you can’t), try hanging art over a mirrored wall. You’ll reap the benefits of the mirror’s room-expanding effect, and you still get to admire a beautiful piece of art. That’s what I’d call a win-win.

On closet doors

Any closet door could benefit from some styling, right? That’s why I love the idea of treating a closet like it’s an extension of a wall, as this Philadelphia renter did here with photos and a mini shelf. Just make sure your art is securely fastened so it doesn’t jostle with opening and closing.

On a refrigerator

Meet the distinguished older cousin of the “magnets on the fridge” phenomenon: framed art on the fridge, first spotted in this Philadelphia rental. Accessorizing a kitchen can be tough, but one single piece of art, or a small triptych of three small little prints in this unexpected spot makes a kitchen’s decor feel intentional but not overpowering. Choose art that pulls together your kitchen colors, and mount it using strong peel-and-stick magnets.

Check out Apartment Therapy for more tips like these.

Related Links

• 2023 Home and Design Trends to Watch

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

• Mortgage rates have peaked along with inflation

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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Wood vs. Gas Fireplaces: Pros and Cons of Each

Whether you're in the market for a fireplace or are just looking to upgrade your existing one, it's important to consider all your options.

Two of the most popular choices are wood and gas fireplaces—but which is right for you? Let's explore the differences between wood and gas fireplaces to help you make an informed decision. 

Ease of Use 
One obvious difference between wood and gas fireplaces is ease of use. Gas fireplaces are much easier to light than their wood-burning counterparts; all it takes is the push of a button or flip of a switch, and you have instant heat. On the other hand, lighting a wood-burning fireplace requires more effort—you must gather kindling, create a proper airflow and make sure that the logs remain lit. If you're looking for convenience, then gas is certainly the way to go. 

Maintenance Considerations 
Gas fireplaces require much less maintenance than traditional wood-burning ones; there's no need to constantly clean up ash or chop wood. However, gas fireplaces do require occasional maintenance such as cleaning out creosote buildup in the chimney or inspecting pipes for any potential problems. For those who don't want to deal with regular upkeep efforts, a gas fireplace may be the better choice.

Installation
When it comes to installation, gas fireplaces are typically easier to install than wood-burning versions. Gas insert installation requires less manual labor, as they don't need to be built up from the ground or have a chimney installed. But if you don't already have gas lines in your home, then you'll need to hire an expert who can install the necessary pipes and venting to make sure your gas fireplace is safe. On the other hand, wood-burning fireplaces require more manual labor and usually need a chimney for proper ventilation. So if you're looking for an easier installation process, consider opting for a gas fireplace instead of a wood-burning one.

Environmental Impact
When comparing wood and gas fireplaces, it's important to consider which option is better for our environment. The EPA has deemed that both types can produce hazardous air pollutants when used incorrectly; however, some studies suggest that properly venting a natural gas appliance could reduce certain pollutants by approximately 70%. If preserving our environment is important to you, then investing in a quality venting system might be worth considering if you decide on a natural gas fireplace. 

Making an informed decision about what type of fireplace to install can seem overwhelming—especially when considering all factors like cost, convenience, maintenance needs and environmental impact—but this comparison should provide some helpful insight into whether a wood or gas fireplace would be best suited for your home. Ultimately it comes down to personal preference; weigh your options carefully before making your final decision! Whatever option you choose will bring warmth and beauty into your home while providing hours of cozy enjoyment during chilly days and nights!

Keep reading here.

Related Links

• 2023 Home and Design Trends to Watch

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

• Mortgage rates have peaked along with inflation

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

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Mortgage rates have peaked along with inflation

The CPI data cooled even though shelter inflation is lagging

Today’s inflation data has shown that the peak growth rate of inflation is behind us. This should also mean mortgage rates hit their highs. The key phrase I have stressed since I wrote about the case for mortgage rates to go lower on Oct. 27 is thinking 12 months out. The trend is your friend, and the month-to-month data has cooled off noticeably.

That cooling happened even with the biggest inflation component — shelter inflation — still rising in the lagged modeled CPI data. This means shelter inflation isn’t being properly accounted for versus the real-time data.

The Consumer Price Index month-to-month readings show that inflation has peaked, as seen below.

If it weren’t for the lagging CPI shelter index, the biggest component, the headline core print, would be lower today on a year-over-year basis. It’s a positive thing that most people have gotten the memo on this reality about shelter inflation because it shows how the headline year-over-year prints are lower as we speak.

While still hot, the year-over-year inflation growth rate is falling, see below. All this is happening with the labor market still very tight, which means the Fed doesn’t need to create a job-loss recession to bring inflation down. The best way to fight inflation is to add more supply, demand destruction is not the most effective way, and it will impact future production.

The jobless claims data on Thursday, as you can see below, was still solid and running at 205,000 for the headline, with a four-week moving average of 212,500.

For those who were saying we needed an unemployment rate above 6% to bring down inflation, you must feel sick to your stomach as that advice would have meant millions of Americans would have lost their job for no reason.

How did the bond market react to this inflation data? It was a mild day compared to what we saw back in November of 2022. However, as I am writing this, the 10-year yield is at 3.45%, which is the third time we are trying to lower this area.

This does mean mortgage rates should be getting better today. We are getting closer to a five-handle in mortgage rates and farther away from the 8%-10% mortgage rates people were talking about late last year when rates peaked at 7.37%.

Digging into the inflation data

From BLS: 
The Consumer Price Index for All Urban Consumers (CPI-U) declined 0.1 percent in December on a seasonally adjusted basis, after increasing 0.1 percent in November, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 6.5 percent before seasonal adjustment. The index for gasoline was by far the largest contributor to the monthly all items decrease, more than offsetting increases in shelter indexes. The food index increased 0.3 percent over the month with the food at home index rising 0.2 percent. The energy index decreased 4.5 percent over the month as the gasoline index declined; other major energy component indexes increased over the month.

Breaking down some of the internals is key to understanding the CPI data. Of course, the biggest component of inflation is housing. I stressed in late 2020 that shelter inflation was going to take off, but the opposite is the reality now. However, the CPI data lags badly here.

Thankfully, the Federal Reserve understood this and created its own index in December to account for the lag. Back in September, on CPI inflation day, I talked about how this would be a positive story in 2023. I said by January or February, it would be evident that the growth rate of shelter inflation was falling, and people have gotten the memo. I could not have asked for a better outcome than where we are today.

Read the full article on Housing Wire.

Related Links

• 2023 Home and Design Trends to Watch

• Why Purchasing New Construction Can Be a Smart Move for First-Time Homebuyers

• What Are Your Goals in the Housing Market This Year?

If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.

Search Homes in Colorado

Search Homes in Oklahoma

Search Homes in Oregon