Rochester’s Housing Market Shows Signs of Slowing Down
By Frank Hough, September 12th, 2018.
After multiple years of rising prices and low inventory, Rochester’s housing market is beginning to slow down. According to the Southeast Minnesota Association of REALTORs, known as SEMAR, Rochester home sales are down three percent in the past twelve months compared to the previous year.
While many Rochester homeowners attributed the recent housing boom to the expansion of Destination Medical Center it’s important to note that most of the United States has also experienced a strong housing market throughout the past three years. The recent lack of inventory, in part, caused housing prices to rise, giving current homeowners large increases in equity.
As prices have continued to rise homeowners have been incentivized to sell their homes and liquidate their equity. The increase in equity pulls the market back from a seller’s market to a balanced market as more and more homeowners list their houses for sale.
Interest rates have also been on the rise. According to Sterling State Bank the current interest rate for a 30 year fixed mortgage is 4.625%.
Homeowners are now seeing the tail end of a seller’s market. Rochester currently has 2.3 months of available inventory. In a balanced market there are between five and seven months of available inventory.
Owners can expect longer Days On Market, or DOM, as the market becomes balanced. According to SEMAR current inventory averages 42 days on the market, compared to 35 days on the market one year ago.
As houses take longer to sell homeowners traditionally move away from boutique brokerages to larger brokerages who offer full services. This is good news of course for the professional REALTORs® at Coldwell Banker River Valley REALTORs®.
Many of our agents, including myself, offer services like paid online advertising, virtual tours, and professional photography. According to realtor.com listings that use professional photography sell faster and for more money than other listings.
It’s still a great time to sell your house, but the market is changing rapidly. If you’d like to know what your home is worth be sure to request a free equity evaluation.