Minnesota’s housing market showed a mixed picture in February, with more homes hitting the market even as buyer activity slowed and prices softened slightly.
According to new data from Minnesota Realtors and Twin Cities metro associations, seller activity picked up while buyers remained cautious, reflecting ongoing affordability pressures and broader economic uncertainty.
More listings, fewer buyers
After two months of declines, new listings increased 1.9% statewide and 0.4% in the Twin Cities metro. At the same time, pending sales fell 3.2% statewide and 3.5% in the metro, though that marks the smallest decline in three months—an early sign the market may be stabilizing.
Inventory also ticked up, rising 3.7% statewide and 2% in the metro, giving buyers more options than they’ve had in recent years. Still, overall supply remains tight at just 2.3 months statewide and 2.1 months in the metro.
“Pent-up demand continues to build, but sellers should understand that buyers are more selective and payment-sensitive nowadays than a few years ago,” says Wendy Uzelac, president of Minnesota Realtors, in a prepared statement. “Rates and the economy will be key to the market’s direction this year.”
Price growth pauses—for now
After years of steady increases, home prices showed signs of recalibration. The statewide median price dipped 1.5% to $339,900, and the metro median price held flat at $380,000.
This shift doesn’t necessarily mean home values are falling across the board. Instead, it reflects a combination of changing buyer behavior and shifting market mix.
More affordable homes made up a larger share of February sales, while higher-priced segments—particularly new construction and luxury homes—saw steeper declines. Sellers are also adjusting expectations, pricing homes more competitively and accepting slightly lower offers.
On average, sellers received 96.4% of list price statewide and 97.4% in the metro, both down slightly from last year.
Market segments show uneven activity
Not all parts of the market are moving in the same direction. Sales under $300K fell 2.5%, while sales over $1M dropped 13.7%. Meanwhile, single-family, condo, and townhome sales all declined, though townhome pending sales showed some growth. New construction sales dropped 13.7%, signaling continued challenges for builders. Minneapolis saw an 18.2% decline in sales, with St. Paul down 7.9%.
First-time buyers continue to face the biggest hurdles, while move-up buyers and downsizers—often bringing equity from previous homes—are better positioned to navigate the market.
A more balanced, more selective market
With more inventory and fewer bidding wars, competition has eased compared to recent years. Homes are taking slightly longer to sell, averaging 74 days on market statewide and 69 days in the metro, roughly in line with last year.
Sellers are also encountering a new reality: Pricing strategy matters more than ever.
“We saw a challenging start to the year, and affordability remains a real concern for many households,” adds Aarica Coleman, president of Minneapolis Area REALTORS. “In this environment, sellers who price their homes strategically and work closely with an experienced professional will be better positioned to navigate the market and reach the right buyer.”