Carlton County housing market follows statewide trends
Low inventory and high prices have created a seller's market, but a shift could be imminent.
CLOQUET — Prospective home buyers in Carlton County have been presented with a challenging dilemma during the past year: The inventory of available houses on the market has seen a steady decline while prices continue to soar beyond original asking prices.
The total number of listings in Carlton County dropped from 549 to 503 between 2020 and 2021, amounting to an 8.4% decrease, according to reports from the Minnesota Realtors Association. The median sale price for homes over that same span increased 12.8% to $220,000 in 2021, a $25,000 rise in cost compared to 2020.
While the pandemic has played a role in these trends, Adolphson Realty Agent Michelle Kuklinski said the cyclical nature of the housing market has made an impact as well.
“I think it’s multiple factors,” Kuklinski said. “I think the pandemic certainly contributed, less so now than in 2020 when things first came out with the pandemic. There were some that were worried about letting strangers into their home to look at them, and open houses, all of that stopped. And those haven’t come back really at all.
“Also, I think if you look at real estate trends over the course of 30-40 years, you’ll see that it’s very cyclical, and we’re kind of at the top of the market right now. Depending on what interest rates do, and pricing and things like that, I think eventually we’ll see things dip down again where it will turn into more of a buyer’s market," she added.
The housing market in Carlton County has followed statewide trends when it comes to availability and cost, according to data from the Minnesota Realtors Association. New listings in Minnesota decreased by 1.6% to 105,490 from 2020 to 2021. The median sales price climbed 11.5% to $306,750 over the same span.
As of the middle of January, Kuklinski estimated there were 24 active listings for residential, single-family homes on the market in Carlton County.
While the volume of listings is low, Kuklinski explained it’s not uncommon to have limited inventory during January. As the winter season ends and spring begins, the market outlook for the year usually becomes more clear.
“The spring is usually how we kind of gauge what the market is going to look like for the year, but our inventory has been really low for the past couple of years,” Kuklinski said.
In December 2021, reports showed that Carlton County saw a nearly 82% increase in new listings with 20, compared to the monthly total of 11 in 2020.
Kuklinski is cautiously optimistic the number of active listings will continue to grow over the course of the new year.
“I think we’ll have a little more inventory this year than we had last year, just because there’s a lot of people that have the mindset of, ‘Well if I’m going to sell, I should sell now, because I’m going to get more for my house now than I will say two years from now.’ So, I think we might see a little bit more inventory this year, but purely a guess, of course,” Kuklinski said.
On the flip side, those in the market to buy a home have been pushed to the limit, with asking prices far beyond the actual value of the home. The result, Kuklinski forecasts, will be a tipping point where prices begin to fall.
“I think we’ve reached a threshold now where things are kind of at the tippy top of where they’re going to be value wise, because buyers are finally getting to the point where they’re like, ‘OK, is this house really worth what it’s listed for? Is it really worth what I’m paying for it?' And we’re certainly on the high end of that,” Kuklinski said.