There was a rise in new home closings in the Minneapolis-St. Paul, MN market in August year-over-year, and the market seemed to be improving as the percentage gain was larger than that of July 2015. New home closings saw a 7.7% rise from a year earlier to 418. This came after a 3.3% hike year-over-year in July.
A total of 4,430 new homes were sold during the 12 months that ended in August, up from 4,400 for the year that ended in July.
Of the total number of closings, new home closings made up 6.1%. A year ago, 6.3% of total closings were new home closings. For new and existing homes, closings grew year-over-year in August after also increasing in July year-over-year.
Pricing and Mortgage Trends
In August, the average price of newly sold homes climbed year-over-year to $405,297 per unit, a 2.8% boost. This hike compares to a 1.7% drop in July from a year earlier.
The average mortgage size on newly sold homes saw a lift year-over-year along with new home prices. Average mortgage size grew 3.0% to $335,423 in August from a year earlier. It went from $326,592 to $329,445 from July 2014 to July 2015.
Other Market Trends
As a share of new home closings, single-family home closings have climbed from last year while the share belonging to attached units has fallen. The share of new home closings belonging to single-family homes jumped from 82.0% in August 2014 to 85.6% of closings in August 2015. Conversely, the share of new home closings belonging to attached units sank to 14.4% of closings from 18.0% of closings.
For all new homes sold, the average unit size slid 8.6% year-over-year to 2,494 square feet in August 2015. In July, the average size of new homes sold went from 2,773 square feet a year earlier to 2,448 square feet.
Foreclosures and real estate owned (REO) closings continued to decline from a year earlier in August, but did not appear to be dragging the market. Combined, foreclosures plus REO closings made up 13.1% of existing home closings, below 17.1% a year earlier. The percentage of existing home closings involving foreclosures dropped to 5.5% in August from 7.6% a year earlier while REO closings as a percentage of existing home closings fell to 7.6% from 9.5% a year earlier.