If you’ve been following the national headlines, you know the housing narrative is still a tug-of-war between interest rates, affordability, and the question everyone loves to ask: Is the market finally going to crack?
Real estate is ultimately local. And in the Twin Cities, the November 2025 data doesn’t read like a crash or a boom. It reads like a market that is slower on volume, firm on value, and still constrained by supply. Here is a deep dive into what is actually happening right now.
Prices Are Firm, Not Frothy
For most buyers and sellers, the only question that matters is: Are prices still moving? They are. Just not violently.
• Median Sales Price: Up 2.9% year-over-year to $387,000.
• Price Per Square Foot: Up 1.4% to $211.
• Year-to-Date: Median sales price is up 2.9% for 2025.
The Takeaway: This is the market’s healthiest look. Appreciation is happening, but it’s controlled. That 2–3% range builds homeowner wealth without turning the market into a speculative casino.
The Inventory Squeeze (Still the Main Story)
This is where the market’s backbone comes from.
• Inventory: Down 1.7% to 9,209 homes for sale.
• Months Supply: Down to 2.4 months.
• New Listings: Essentially flat (+0.1%) at 3,728, but up 4.1% year-to-date.
What this means: Sellers are coming back, but not fast enough to create breathing room. Homes are still getting absorbed as they hit the market. We remain in seller’s market territory, driven by scarcity rather than frenzy.
And, seasonality matters: as we head deeper into winter, listing volume typically drops. If demand stays even moderately steady, that supply constraint can become more visible.
Buyers Are Cautious, Not Gone
The pace has cooled, but the market isn’t empty.
• Pending Sales: Down 2.4% (3,072).
• Closed Sales: Down 5.6% (3,275).
• Days on Market: 50 days, flat versus last year.
The Takeaway: This is what a “selective buyer” market looks like. People are still buying, but they’re filtering harder. They will pay up for quality and walk away faster from anything that feels overpriced or messy.
This is also why days on market can stay flat even as volume falls: the good listings move, the weak ones sit.
The Negotiation Gap
Are sellers getting their number? Mostly.
• Percent of Original List Price Received: 97.4% (slightly down from 97.6% last year).
• Median List Price: Up 1.9% to $397,430.
The Strategy:
• For sellers: you still have leverage, but you don’t have the right to be unrealistic. The market will pay for clean, well-presented homes priced correctly. Overreach and you’ll bleed time.
• For buyers: that ~2–3% gap is your opening. Not to play games, but to negotiate repairs, concessions, and terms—especially on listings that have been sitting.
The Macro Tailwind: Affordability Improved
This is the quiet driver of sentiment.
• Housing Affordability Index: 121, up from 118 last November.
The Takeaway: Buyers have slightly more purchasing power than they did a year ago. It’s not a return to “easy money,” but it’s a meaningful nudge in the right direction—especially paired with the market’s shift from desperation to deliberation.
What Should You Do?
For Sellers: The inventory shortage is still your biggest asset. With 2.4 months of supply, you have leverage—if you respect the market. Prep the home. Price it like it’s 2025, not 2021. Expect near-ask outcomes, not automatic bidding wars.
For Buyers: The frenzy is gone. You have time to think. Use it. Focus on value, condition, and terms. If a home is stale or obviously mispriced, that’s where negotiation becomes real.
For Developers & Private Lenders: The data continues to validate the structural undersupply thesis. Resale inventory is shrinking and months supply remains tight, which supports new construction demand. But the dip in pending/closed sales is a reminder that absorption is rate-sensitive and seasonal. Underwrite slightly longer sales cycles, stronger reserves, and real-world incentives/concessions where needed.
This is not a market for sloppy pro formas.
It’s a market for disciplined underwriting and structures that don’t require perfect conditions.
Data Source: Minneapolis Area REALTORS® | November 2025 Monthly Indicators
