You heard it here first - 2024 is going to be a BIG year for the MN real estate market!
What can you expect to experience this year? Is this a good time to buy, sell, or invest in homes in MN?
5 Factors Affecting the 2024 Real Estate Market
Top factors that will influence the market this year include:
Inflation: While some inflation may be slowing, living costs are still very high
Interest Rates: The Fed has reportedly reversed course with plans for 3 rate cuts in 2024
Affordability: This is a combination of prices, as well as wages and unemployment
Seasonality: MN is a very seasonal market. Watch the big picture
The Presidential Election: Expect plenty of twists, turns, and spreading of uncertainty
BOLD Predictions For The Local Housing Market In 2024
#1 - Average House Prices Will Go UP
Although there may be many headwinds, local house prices seem likely to continue to rise in 2024. Especially as we hit the peak summer home buying months.
Average prices are up slightly year over year. With homes selling for right about their asking prices, and in just around 24 days.
Minnesota also has some of the most affordable housing in the country, with average home prices almost $100k, or 25% lower than the national average. That leaves a lot of room to grow.
#2 - More People Will Move To MN
Other cities and states continue to experience huge population losses as people flee for better quality of living and more value for money.
Some of the top cities for movers looking to buy in MN include Miami, San Francisco, Seattle, Los Angeles, and Washington DC.
The appeal of Florida, Texas, and Nevada has eroded. Leaving millions looking for new destinations, or to return home.
#3 - Financial Distress Will Grow By Over 100%
Even though much of the data hasn’t been publicly reported or commented on in the media, there has to be good reason for the Fed to take a big 180 degree turn from rate hikes, to rate cuts.
The truth is that the economy is in a much more fragile state than many are letting on. Consumer and business loans, car loans, and credit card debts are all performing terribly. With mounting distress accumulating in the shadows.
The Minneapolis Area Association of Realtors (MAAR) reports that as of November, lender repossessed listings had grown by 117.4%, and short sale listings rose by 125% year over year.
These properties can sell for 30% less than their traditional listing competition. However, they still make up a small percentage of overall sales volume.
This means opportunity for finding great deals, though at a pace that won’t tank the overall market.
#4 - Investment In MN Real Estate Will Grow
Broader economic volatility and uncertainty is going to drive more investment in MN real estate this year.
Money will flow from other asset classes into real estate for wealth preservation, rental income, and tax breaks.
According to data from the Federal Reserve Bank of St. Louis and Federal Housing Finance Agency (FHFA), Minnesota continued performing better, for longer than other major cities in the last financial crisis.
This fact, along with our advantage in being a more stable and reliable market, with more growth potential, and better affordability, will make MN stand out as a magnet for investment capital in 2024.
Check out some of the Top Communities to Buy Homes In MN Now
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