The Southwest Journal recently reported about rent increases in several Lyndale Neighborhood multi-family buildings. That strikes us as a good time to take the pulse of the owner-occupied or homeownership market.
Lyndale neighborhood prices have risen, as have those in Powderhorn and the entire city. Lyndale prices are hovering between the powderhorn community and the entirety of Minneapolis. At $217,450, prices are just under 10.0 percent higher than in the Powerderhorn Community but have risen about 28.0 percent from this time last year.
For those looking for condos, however, the landscape is significantly more affordable than when you include single-family homes in the mix. Lyndale condo prices are $127,500, the same as Powderhorn, significantly less than Minneapolis and have only risen a more modest 8.1 percent over the last year.
Locking the right condo into a purchase agreement can be challenging, however. Inventory levels are quite thin, which can pit serious buyers against one another and also suggests that sellers are likely to get (and accept) strong and competitive offers.
Both home prices and rents are rising across the board, though at differing rates depending on location, building and price point. There are still lots of asymmetries when it comes to supply and demand. The key to overcoming any affordability challenges will be maintaining our steady job and wage growth and ensuring home prices rise in line with incomes.
The Lyndale Neighborhood is part of the Powderhorn Community and not the Calhoun-Isle Community (or “Uptown” to some). The Powderhorn boundary juts out to the west of I-35W to incorporate Whittier and Lyndale (map). Whittier and Lyndale are typically thought of as part of “Lyn-Lake,” just in case the various official and unofficial geographies weren’t confusing enough.
In terms of the price per square foot of a traditional, single-family, previously owned home, Lyndale tracks very close to the city with a value of $156 per square foot compared to $155 for Minneapolis. Just across Lake Street to the north, similar Whittier properties are selling for $151 per square foot.
Absorption rates are noticeably tighter in Lyndale than in Minneapolis. There are currently 1.5 months supply of inventory in Lyndale compared to 2.2 months supply in the City of Minneapolis as a whole. That means that there is about 50.0 percent less supply relative to demand in Lyndale compared to the city.
Similarly, homes in Lyndale are taking a median of 20 cumulative days on market to go under contract. For comparison, sellers in Minneapolis are waiting a median of 28 cumulative days before accepting offers.
Lyndale sellers are accepting offers at a median of 98.7 percent of their original list price. That’s one of the highest figures compared to nearby peer neighborhoods. Whittier sellers are accepting 97.2 percent of their original list price, Lowry Hill East sellers are accepting 98.3 percent.
Examining listing activity, active counts or sales trends by price range can shed a lot of light on local market dynamics. In terms of seller activity, the $200,000 and up range used to be the lion’s share of the market from 2005-2008. Since mid-2013, the $200,000 and up price point has once again dominated new listing activity.