The Howe neighborhood is a flourishing area in the Longfellow Community of Minneapolis. With tremendous access to the river, biking and walking trails, light rail, dining, theater, night life and other resources, it’s no wonder prices in this area have recovered off their lows and have been quite stable for the past year.
The median price paid per square foot was $163 in August. That figure hasn’t changed much since June 2014. But it has recovered significantly from the $97 per foot paid in February 2012. While that figure fell below the entire Longfellow Community as well as the City of Minneapolis in the dark depths of the Great Recession, it’s been outperforming both comparable areas since November 2013.
Absorption rates—or the number of months it would take to completely sell off all active housing supply assuming no new listing activity—are tighter in Howe than in Longfellow and the city as a whole. With just 1.9 months of supply, a dramatic 34.5 percent decrease from the year prior, the Howe Neighborhood can be described as a strong seller’s market. But attractive interest rates, prices below their nominal and inflation-adjusted peaks and steady job growth are just a few factors motivating buyers.
With monthly inventory levels tied at a 10-year low, many market participants and spectators are watching the number of active listings closely—and rightly so. Some sellers are motivated by rising prices and strong purchase demand but many sellers are sitting tight for now.
Aside from increased new listing activity of existing homes, another way to replenish inventory is via new construction—though to a lesser extent in the core cities. While nine newly constructed new listings may not seem like a lot, the fact that June 2015 had five times the new construction listing volume of the previous record is fairly impressive.