Here’s a statistical breakdown of where demand in our market is coming from.
What’s clear is that our local market is on fire and buyer activity remains high in the face of low inventory, but what’s not so clear is where, exactly, all these buyers are coming from. One of our subscribers, Jane, wanted to hear some statistics about this, and what we found is certainly interesting enough to share with you today.
This year, we are finding that 50% of our market’s home sales originate locally, meaning the general Savage, Prior Lake, and Shakopee area. Buyers are either moving from one of these municipalities to another or moving to a new home within the same municipality.
On the other hand, 30% of our sales are relocations, which is definitely something we haven’t seen in years prior. By “relocations,” we mean buyers coming in from anywhere outside of the greater Twin Cities area, be it elsewhere in Minnesota or nearby states like Wisconsin and the Dakotas. A significant portion of these homebuyers were part of a corporate relocation, which, in the year of COVID, is good news; corporations are still spending money to move their employees around. Not too long ago when the economy was in rougher shape, we were lucky to see just a few corporate relocations.
The third-largest segment of buyers (roughly 20%) is comprised of those who are moving into our local area from somewhere that’s still within the greater Twin Cities area. That includes areas north of the river and some spots a bit further east or west. At the moment, there’s nothing concrete we can pinpoint to explain why more of these Greater Twin Cities homebuyers seem to be headed our way; different agents have different clients, of course, and since much of the information exchanged between them is confidential, it’s virtually impossible to gather enough data to pinpoint driving factors.
Last but not least, we have a very small number of folks buying second homes in our market. More often than not, these seasonal residents are southerners who want a place to stay up here when visiting family throughout the year.
Hopefully, you found this buyer breakdown interesting. Remember the important takeaway: The demand we’re seeing in our market today may look different than it did in years past, but it’s quite strong nevertheless. If we can answer any other question you may have or you’d like us to cover a particular real estate topic, please reach out by phone or email. We’d love to hear from you!