In the Minneapolis-St. Paul, MN market, closings of new homes climbed year-over-year in January, but there were signs of market leveling as the percentage surge was less than December 2015. Closings gained 1.4% from a year earlier to 224. This was after the housing market saw a 21.8% climb year-over-year in December.
A total of 4,705 new homes were sold during the 12 months that ended in January, up from 4,702 for the year that ended in December.
Of the total number of closings, new home closings made up 5.9%. A year earlier, new home closings made up 6.3% of total closings. For new and existing homes, closings increased year-over-year in January after also increasing in December year-over-year.
Pricing and Mortgage Trends
For newly sold homes, the average price declined 3.9% year-over-year in January to $411,103 per unit. This decline compares to a 4.5% surge in December year-over-year.
Average mortgage size on new homes slid year-over-year in contrast to new home prices. In January 2016, average mortgage size on new homes sold was $331,996, down 1.0% from a year earlier. It went from $340,148 to $340,818 from December 2014 to December 2015.
Other Market Trends
There has not been much movement in the composition of the market with regard of the types of properties sold. From a year ago, single-family home closings have moved from 84.2% of new home closings to 83.9% of closings while attached units have gone from 15.8% of closings to 16.1% of closings.
There was a 25.8% drop year-over-year in the average unit size of newly sold homes to 2,069 square feet in January 2016. In December, the average size of new homes sold went from 2,946 square feet a year earlier to 2,822 square feet.
Foreclosures and real estate owned (REO) closings declined in January from a year earlier, but remained a burden on the market. Out of all existing home closings, foreclosures combined with REO closings accounted for 25.4% of closings, below 34.6% a year earlier. The percentage of existing home closings involving foreclosures fell to 11.0% in January from 17.3% a year earlier while REO closings as a percentage of existing home closings dropped to 14.4% from 17.3% a year earlier.