In the Minneapolis-St. Paul, MN market in May, closings of new homes declined year-over-year, but with a percentage fall not as steep as April 2016, there are signs that the market may be evening out. New home closings saw a 3.8% decline from a year earlier to 430. This came after a 13.9% fall year-over-year in April.
A total of 4,773 new homes were sold during the 12 months that ended in May, down from 4,790 for the year that ended in April.
Of the total number of closings, new home closings made up 6.1%. A year ago, new home closings made up 6.2%. Following a year-over-year increase in April, closings of new and existing homes dropped year-over-year in May.
Pricing and Mortgage Trends
For newly sold homes, the average price moved from $428,865 in May 2015 to $427,900 in May 2016. This came after a move from $409,685 per unit to $408,042 from April 2015 to April 2016.
For newly sold homes, the average mortgage size saw a bump year-over-year in contrast to new home prices. It jumped to $346,016 in May, a 1.5% hike. In April 2016, average mortgage size gained 3.5% from a year earlier.
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. Single-family home closings rose from 79.4% of new closings in May 2015 to 85.8% of closings in May 2016. Conversely, the share of new home closings belonging to attached units declined to 14.2% of closings from 20.6% of closings.
For all new homes sold, the average unit size fell 7.4% year-over-year to 2,559 square feet in May 2016. In April, the average size of new homes sold went from 2,755 square feet a year earlier to 2,451 square feet.
Foreclosures and real estate owned (REO) closings continued to drop from a year earlier in May, but did not look to be a burden on the market. Foreclosures and REO closings, taken together, represented 12.5% of existing closings, lower than 14.3% a year earlier. The percentage of existing home closings involving foreclosures declined to 4.9% in May from 5.9% a year earlier and REO closings moved from 8.4% of existing home closings in May 2015 to 7.7% in May 2016.