The Minneapolis/St. Paul market seems to be nearing a point of “peak inventory.” Since the 1st of the year, our year-over-year inventory numbers have been narrowing dramatically… to the point that they are almost even. What this means for us is that when homes for sale hit their annual peak this summer before the seasonal fall-off, that may be the most houses we’ll see for sale at one time for many years to come.
Traditional sellers have not been listing homes on the MLS nearly as much this year as they did last year and new construction has backed off as well. Once we eliminate many of these foreclosures from the market and we see fewer of them come on the market, then we are likely to see a draw down in active listings.
While falling inventory for sale isn’t a sign that our market has hit bottom, it is a sign that the market is closer to finding an equilibrium.